Reporting of Overpayments
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Question: What is the OIG's policy
regarding the reporting of Federal health care program overpayments by providers under CIAs?
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Providers under CIAs must promptly notify the appropriate
payor of all identified overpayments and must promptly repay the overpayment amount in a manner
consistent with the payor's policies. Although all identified overpayments should be refunded
to the appropriate payor, a provider under a CIA does not need to report to the OIG all identified
overpayments at the time it reports such amounts to the payor. Rather, the provider must report
to the OIG the yearly aggregate overpayment amount in its annual report. Further, the provider
must report to the OIG within 30 days all "material deficiencies" as defined by the
CIA. "Material Deficiency" generally means anything that involves: (i) a substantial
overpayment; or (ii) a matter that a reasonable person would consider a potential violation of
criminal, civil, or administrative laws applicable to any Federal health care program for which
penalties or exclusion may be authorized.
A material deficiency may be the result of an isolated
event or a series of occurrences.
If the provider's annual or periodic review also identified
underpayments, the provider may work with the Federal payor to determine whether those underpayments
may be offset from the identified overpayment(s). Nonetheless, because the OIG is interested
in the identification of potential billing problems, regardless of how reporting and repayment
is handled with the payor(s), in its annual report, the provider must report to the OIG a gross
overpayment total. Thus, the provider should not report to the OIG an overpayment amount that
is reduced (or "netted") based on underpayments. The reporting of only net overpayments
does not provide the OIG with a sufficient indication of potential billing problems.
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Selecting
an Independent Review Organization
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Question: Does the
OIG endorse or assist a provider in choosing a compliance vendor or IRO?
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The OIG does not endorse any proprietary products. Moreover,
the OIG will not indicate which IROs it believes are most qualified. It is up to the provider
to determine the most appropriate CPA firm, law firm, or consultant to engage as its IRO. If,
following the annual review, the OIG has concerns about the quality of the review, or the independence
of the IRO based on the totality of the circumstances, the OIG may make those concerns known
to the provider.
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Material
Deficiencies/Reportable Events
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Question: The OIG's corporate integrity
agreements (CIA) require that the provider report to the OIG all "material deficiencies" or “reportable
events.” Providers often ask the OIG whether a certain percentage or dollar threshold
is appropriate for determining if a violation is reportable. Does the OIG believe such percentage
or numeric thresholds are appropriate for determining if there was a "material deficiency” or “reportable
event?"
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No. The OIG defines the terms "material deficiency" and “reportable event” in
its CIAs by noting that it could be (i) a substantial overpayment or (ii) a matter that a reasonable
person would consider a probable violation of criminal, civil, or administrative laws applicable
to any Federal health care program for which penalties or exclusion may be authorized. Such a situation
may be the result of an isolated event or a series of occurrences. In short, a provider under a
CIA must determine if an identified matter requires disclosure under the CIA based on the totality
of the facts and the context of the surrounding circumstances. The OIG believes that a percentage
or numeric threshold simply constitutes the initial step in determining materiality and therefore
reliance solely on such a “rule of thumb” threshold is inappropriate and should not
replace a detailed analysis of all the relevant facts and circumstances.
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CIA
Claims Reviews
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Background:
Most Corporate Integrity Agreements (CIAs) or Settlement Agreements with integrity provisions
(Agreements) require that a Claims Review be conducted, either by an independent review organization
(IRO) or in some cases by the provider, with a verification review performed by the IRO. Over the
past several years, the language and the claims review methodology used in these CIAs and Agreements
to describe the Claims Reviews have changed.
Previous language required the review to consist of a statistically valid sample of claims or
required the reviewer to review a Probe Sample and based on the results of the Probe Sample to
review a Full Sample in accordance with certain confidence and precision levels.
In response to the potential financial impact of the previous Claims Review approaches, the OIG
has modified its Claims Review requirements. Briefly, the new Claims Review procedures require
a Discovery Sample of 50 sampling units to be randomly selected for review. If the net financial
error rate of those 50 sampling units equals or exceeds 5%, then a Full Sample must be reviewed
and a Systems Review must be conducted. The Full Sample must include a sufficient number of sampling
units to yield results that estimate the overpayment in the population within a 90% confidence
and 25% precision level. As indicated in the Inspector General's November 20, 2001, Open Letter,
the OIG is reviewing each provider's CIA or Agreement to determine whether it is appropriate to
incorporate the new Claims Review procedures into the existing CIA or Agreement.
In those cases where the OIG determines that the new Claims Review provisions may be appropriate,
the provider will be offered the option to accept these new provisions or maintain its current
provisions.
Purpose of Claims Review FAQs:
The following is a list of questions the OIG is frequently asked by providers or their IROs regarding
the Claims Review. These questions are intended to provide guidance to all providers under CIAs
and Agreements, regardless of the specific Claims Review provisions used in the provider's CIA
or Agreement.
Please note: Previous CIA or Agreement review language may have been referred to as "Billing
Review" or "Billing Engagement" instead of "Claims Review." For consistency
with the OIG's current review provisions, we use the term "Claims Review" throughout
this document.
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Question 1: If
a CIA or Settlement Agreement does not include detailed Claims Review requirements, what guidelines
should a provider follow?
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Although not expressly required by all CIAs, the OIG suggests that Claims Reviews be conducted
in accordance with the following guidelines:
A Discovery Sample, of at least 50 sampling units, should be examined. The units for the Discovery
Sample should be randomly selected using a random number generator or a statistically valid manual
selection process (e.g., a random numbers table). For each unit reviewed, the reviewer should determine
the dollar difference between the provider's actual reimbursement and the amount the provider should
have been reimbursed (based on contractor and the Centers for Medicare and Medicaid Services ("CMS")
policies). Once all sampling units have been reviewed, the results of each sampling unit are added
together (underpayments may be netted or offset from overpayments). The resulting calculation is
the net overpayment. The reviewer divides the net overpayment by the total dollar amount of the
sample. The resulting calculation is the net financial error rate.
If the net financial error rate equals or exceeds 5%, we recommend that the reviewer conduct a
Full Sample. Based on the results of the Discovery Sample, the reviewer should estimate how many
sampling units will need to be reviewed to estimate the overpayment in the population within certain
confidence and precision levels. A 90% confidence and 25% precision level is required in current
CIAs. If a provider's Agreement or CIA does not specify confidence and precision levels, the OIG
recommends that the Full Sample results achieve a 90% confidence and 25% precision level.
The reviewer may use the Discovery Sample as a whole, as part of its Full Sample, if statistically
appropriate. For example, if the reviewer must examine 200 sampling units in the Full Sample, the
reviewer may use the results from each of the 50 units in the Discovery Sample. Therefore, the
reviewer only has to randomly select and review an additional 150 sampling units. The results of
all units reviewed as part of the complete Full Sample should be reported, i.e., 200 sampling units.
If a Full Sample was conducted, the OIG also recommends that the provider conduct a Systems Review.
Specifically, for each sampling unit in the Full Sample (which may include the Discovery Sample)
that resulted in an overpayment, the reviewer should perform a "walk through" of the
system(s) and process(es) that generated the sampling unit to identify any problems or weaknesses.
See response to question 28 for more details about the Systems Review.
The results of the Discovery Sample and, if applicable, the Full Sample and Systems Review, should
be reported to the OIG in the provider's Annual Report. See response to Question 2 for recommendations
regarding what to include in the report.
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Question 2: What information
should be reported to the OIG in the Claims Review findings, as part of an entity's Annual
Report?
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In addition to including a narrative description of the findings, which describes the results
of the Claims Review, the OIG recommends that for each sample the following information also be
included in the Claims Review Report:
- Name and credentials of the person(s) who conducted the review;
- Name and credentials of the person who designed the sampling plan;
- Copy of the sampling plan;
- Time frame covered by the review;
- The objective of the review;
- Definition of the sampling unit (e.g., beneficiary, claim, service);
- Description of the sample universe (e.g., the list of the codes/services that comprise the
universe);
- Description of how the universe was determined;
- Description of the documentation relied upon to perform the review;
- Narrative description of how the Claims Review was conducted and what information was evaluated,
including an indication as to whether the sample was generated in a statistically valid manner;
- Total number of sampling units that comprised the universe;
- Methodology used to determine the strata (if the universe is stratified);
- Methodology used to select the sample from the universe;
- Number of sampling units included in each sample;
- Total number of Medicare sampling units selected in the Probe or Discovery Sample and the
total number of Medicare sampling units selected in the Full Sample (if applicable);
- Total number of Medicaid sampling units selected in the Probe or Discovery Sample (as applicable)
and the total number of Medicaid sampling units selected in the Full Sample (if applicable);
- Total number of other Federal health care payor sampling units selected in the Probe or Discovery
Sample (as applicable) and the total number of other Federal health care payor sampling units
selected in the Full Sample (if applicable);
- If the OIG's Office of Audit Services Statistical Sampling Software (RAT-STATS) was used
for the Probe or Discovery Sample, the IRO should provide the seed number assigned by the random
number generator. If a Full Sample was required, the reviewer should provide: (1) the seed
number for the Full Sample; (2) a printout of the variable appraisal results for both the Probe
or Discovery Sample and the Full Sample; (3) a printout of the data file used as input into
the RAT-STATS Variable Appraisals program; and (4) a printout of the sample size estimate results;
- If a statistical software sampling package other than RAT-STATS was used, the reviewer should
provide: (1) a copy of the printout of the random numbers generated by the ‘Random Numbers'
function for the Probe or Discovery Sample and for the Full Sample, if applicable; (2) a copy
of the printout estimating how many sampling units are to be included in the Full Sample, if
applicable; and (3) a description of the software package used to conduct the sample;
- Total number of sampling units in error;
- Percentage of sampling units in error;
- Total number of sampling units in error that resulted in an overpayment;
- Percentage of sampling units in error that resulted in an overpayment;
- Total dollar amount of the sampling units in the sample;
- Gross overpayment received as a result of the errors;
- Dollar amount of the underpayments as a result of the errors;
- Net overpayment received as a result of the errors (subtract the underpayments from the gross
overpayment);
- Net financial error rate of the sample (amount of net overpayment divided by the total dollars
in the sample);
- Description of the provider's billing and coding system(s), including the identification,
by position description, of the personnel involved in coding and billing;
- Narrative explanation of the findings and supporting rationale (including reasons for errors,
patterns noted, etc.) regarding the Claims Review;
- Description of the provider's response and corrective action plan related to any deficiencies
uncovered as a result of the Claims Review; and
- Documentation indicating that the overpayment was refunded to the appropriate payor.
The OIG also finds it helpful if a spreadsheet of the reviewer's determinations for each sampling
unit is included in the report. The spreadsheet should include the following elements:
- Federal health care program billed;
- Beneficiary health insurance claim number;
- Date of service;
- Code submitted;
- Code reimbursed;
- Amount reimbursed;
- Correct code as determined by the reviewer;
- Correct reimbursement amount as determined by the reviewer; and
- Dollar difference between the amount reimbursed and the correct reimbursement amount.
Please note: Most current CIAs and all amended Review Procedures require that this information
be submitted to the OIG in the Annual Report.
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Question 3: Is there
a standard format for submitting the Claims Review findings to the OIG?
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The OIG does not have a standard format for reporting
Claims Review findings as part of an Annual Report. The content and length of reports vary based
on, among other factors, provider type, compliance initiatives and corporate structure. The OIG
does recommend that the report include the elements listed in the response to Question 2.
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Question 4: Many past
CIAs and Agreements contain language requiring that a statistically valid sample of claims
be reviewed. How does the OIG interpret this provision?
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The intent of this provision, as used in Settlement
Agreements and CIAs, is that the provider will randomly select through a statistically valid
method an adequate number of sampling units to be reviewed. The number of units selected must
be large enough to draw reasonable conclusions regarding overpayments that exist in the population
from which the sample was selected. (Note: The sampling unit does not have to be a claim. Therefore,
the reviewer should define the sampling unit.)
If the reviewer is not using the Probe or Discovery Sample approach to determine the number of
sampling units to be reviewed, the rationale for selecting the number of sampling units that were
reviewed should be included in the report.
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Question 5: Does the
OIG require certain statistical software to be used when performing a Claims Reviews?
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In the past, the OIG required the reviewer to use RAT-STATS,
a statistical software package developed by the OIG's Office of Audit Services. RAT-STATS is
designed to run on personal computers using Microsoft's Disk Operating System (MS-DOS) and is
publicly available in downloadable form through the Internet at http://oig.hhs.gov.
The users manual can be downloaded from the same site. Both the software and the users manual
are free.
The OIG no longer requires RAT-STATS to be used when performing Claims Reviews. If the reviewer
chooses to use a statistical software program other than RAT-STATS, in its report to the OIG, the
reviewer should provide a description of the software package used to conduct the Claims Review
and should provide the supporting documentation generated from the software package (e.g., random
number printouts and sample size estimate printouts) to support its sampling methodology and results.
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Question 6: If a reviewer
chooses to use RAT-STATS, what features of RAT-STATS should be used to perform a CIA Claims
Review?
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The following components of RAT-STATS should be used
to perform a CIA Claims Review:
- Random Numbers (See response to Question 7 for specific guidance on how to use this feature):
to draw random samples for both the Probe or Discovery Sample and the Full Sample;
- Variable Appraisals (See response to Question 8 for specific guidance on how to use this feature):
to calculate the mean and standard deviation of the overpayment amount in the sample; and
- Sample Size Estimator (See response to Question 9 for specific guidance on how to use this
feature): to estimate the size of the Full Sample.
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Question 7: How is RAT-STATS
used to select a random sample?
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Before RAT-STATS can be used to generate the sample,
the sampling unit and the population from which the sample will be selected must be defined.
Once the sampling unit and the population have been identified, each sampling unit in the population
should be assigned a number (these assigned numbers will correspond to the numbers generated
by RAT-STATS). Begin by selecting the "Random Numbers" component of RAT-STATS. The
programs then asks for:
- the seed number – this field should be left blank unless reproducing a previous sample;
- the name of the audit;
- the number of random numbers to be generated;
- the number of spares to be generated. Generally, there is no reason to use spares, because
if documentation to support payment of a sampling unit cannot be produced, it should be considered
an overpayment;
- the universe range, the number of the first sampling unit (e.g., 1) and the number of the
last sampling unit number;
- choose "disk" to save results to a disk or "printer" to print the results.
The generated results will be a list of numbers. The numbers generated by RAT-STATS are the numbers
of those sampling units that have been selected for review.
Once the sampling units have been reviewed, a text file detailing the amount of the overpayment
for each sampling unit must be created. If there is no overpayment or if there is an underpayment,
a zero should be associated with the corresponding unit. Each line of the text file should include
the sample unit number, a space, and the amount of the overpayment (dollar sign is not necessary).
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Question 8: How is the
Variable Appraisals component of RAT-STATS used for the probe sample analysis?
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After creating the text file of overpayments based on
the results of the Probe or Discovery Sample, select the Variable Appraisals component of RAT-STATS
to calculate the mean and standard deviation of the overpayment amount in the sample. To calculate
the mean and standard deviation of overpayments in the sample, the sampling units from the Probe
or Discovery Sample should be reviewed and a dollar difference determination should be made on
each sampling unit (i.e., the difference between what was reimbursed and what should have been
reimbursed based on the reviewer's determination). The mean and standard deviation of the overpayment
amount in the Probe or Discovery Sample is used to determine the Full Sample size.
To use the Variable Appraisals feature:
- choose the "Unrestricted" option;
- input the name and location of the text file (e.g., c:/probe.txt);
- choose option 3 "Difference Values Only" (the text file created is composed of the
dollar difference of what was paid and what should have been paid);
- choose any of the summary features (they all provide the mean and standard deviation of the
sample);
- choose "disk" to save results to a disk or "printer" to print the results;
- enter the universe size; and
- if it is desired to have the data file printed, select "yes" in response to this
question, which will print the text file containing the raw data.
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Question 9: How is RAT-STATS
used to determine the sample size?
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Once the mean and standard deviation of the overpayment
amount in the Probe or Discovery Sample have been calculated, the Full Sample size can be determined.
Select the "Utility File" component from the main menu. Select the "Sample Size
Estimators" component.
RAT-STATS will ask for the following information:
- name of audit;
- total sample size - when using this feature to determine the sample size, a zero should be
entered in this field;
- select whether the results will be saved to disk, printed or displayed;
- enter the number of strata; if sample was not stratified enter "1";
- enter a name for the strata;
- enter the estimated mean of the overpayments in the Probe or Discovery Sample as calculated
by the Variable Appraisals function;
- enter the size of the universe (i.e., the total number of sampling units from which the Probe
or Discovery Sample was selected); and
- enter the estimated standard deviation of overpayments in the Probe or Discovery Sample as
calculated by the Variable Appraisals function.
The results indicate the estimated number of units that should be sampled to achieve various confidence
and precision levels. The number of sampling units to be selected for the Full Sample should correspond
to the 90% confidence and 25% precision levels, as required by current CIAs. Note: Sample sizes
vary according to the variability of the overpayments in the Probe or Discovery Sample and the
population size. Therefore, the results of one Probe or Discovery Sample may not be applied to
another population.
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Question 10: What sampling
units should be included in the population?
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The reviewer determines the sampling unit, keeping in
mind that the sampling unit chosen should be consistent with the objective of the Claims Review.
For example, if the objective is to examine only a certain type of service, sampling units for
other types of services should not be included in the population. Further, only services for
which the provider has submitted a bill/claim AND has received reimbursement (full or partial)
should be included in the population.
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Question 11: What sampling
unit should be used?
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A sampling unit is any discrete unit that can be sampled
(e.g., code, line item, beneficiary, patient encounter). For any sampling methodology used, each
sampling unit in the population should have a known chance of selection.
The sampling unit is selected and defined by the reviewer
and should be consistent with the objective of the Claims Review. The manner in which a provider
maintains its records may influence the sampling unit to be used. For example, if a provider
keeps all information in the patient's chart and cannot easily retrieve the information by claim
or line item, the better sampling unit is the beneficiary (e.g., patient chart or record), because
an accurate population based on another characteristic could not be easily determined.
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Question 12: What guidelines
should the reviewer use to evaluate the sampling units?
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As part of its Claims Review, a reviewer should ensure that the sampling units were correctly
coded, submitted, and reimbursed. Documentation to make these determinations include, but are not
limited to: national policies, local policies, CMS program memoranda, Medicare carrier or intermediary
manuals or bulletins, medical records, claim forms, and any other supporting documentation. Only
those sampling units for which payment (either full or partial) has been received should be included
in the population from which the sample is selected.
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Question 13: What is
the purpose of a Probe Sample for a CIA Claims Review?
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The objective of conducting a Probe Sample as part of the Claims Review is to establish an estimate
of the variability of the overpayment amount in the population from which the sample was drawn.
The results of the Probe Sample allow the reviewer to estimate how many sampling units need to
be reviewed to estimate the overpayment in the population within a 90% confidence and 25% precision
level.
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Question 14: What is
the purpose of a Discovery Sample for a CIA Claims Review?
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The purpose of conducting a Discovery Sample as part of the Claims Review is to determine the
net financial error rate of the sample that is selected. If the net financial error rate equals
or exceeds 5%, the results of the Discovery Sample are used to determine the Full Sample size.
The Full Sample size is based on an estimate of the variability of the overpayment amount in the
population from which the sample was drawn. The results of the Discovery Sample allow the reviewer
to estimate how many sample units need to be reviewed in order to estimate the overpayment in the
population within certain confidence and precision levels (e.g., generally, a 90% confidence and
25% precision level).
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Question 15: If a sampling
unit in the Probe or Discovery Sample has been underpaid and a Full Sample is required, how
should the underpaid sampling unit(s) be counted in terms of the unit's dollar difference when
determining the Full Sample size?
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For purposes of calculating the Full Sample size (note: If conducting a Discovery Sample, a Full
Sample size is only required if the net financial error rate of the Discovery Sample equals or
exceeds 5%. If conducting a Probe Sample, a Full Sample is only required if there is one or more
overpayment errors in the Probe Sample), sampling units that have been underpaid in the Probe or
Discovery Sample should be considered as a zero. This is because the objective of the Claims Review
is to determine the amount of overpayments in the population. Given this objective, neither a dollar
difference of zero nor an underpayment are considered to be overpayments, thus a zero should be
entered into the calculation for that particular sampling unit.
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Question 16: When conducting
a Discovery Sample, how is the error rate determined?
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In a Discovery Sample, as in a Probe Sample, each sampling
unit is evaluated to determine the dollar difference between the amount that was reimbursed and
the amount that should have been reimbursed. Once all sampling units have been reviewed, the
results of each sampling unit are added together (underpayments may be netted or offset from
overpayments). The resulting calculation is the net overpayment. The reviewer divides the net
overpayment by the total dollar amount of the sample. The resulting calculation is the error
rate.
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Question 17: In what
circumstances should the reviewer review a Full Sample?
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When conducting a Discovery Sample, if the net financial
error rate of this sample equals or exceeds 5%, the reviewer must conduct a Full Sample. The
Full Sample should consist of a sufficient number of sampling units to yield results that estimate
the overpayment in the population to be within a 90% confidence and 25% precision level. Please
note, if the net financial error rate of the Discovery Sample is below 5%, the review is complete.
When conducting a Probe Sample, if there is at least one overpayment error in the Probe Sample,
the reviewer must conduct a Full Sample. The Full Sample should consist of a sufficient number
of sampling units to yield results that estimate the overpayment in the population to be within
a 90% confidence and 25% precision level. If there are no errors in the Probe Sample, some more
recent CIAs or Agreements require that a second Probe Sample be conducted, while older CIAs and
Agreements do not. If the provider is not required to conduct a second Probe Sample, the provider
should contact its OCIG monitor for guidance on determining the Full Sample size. If a second Probe
Sample is required, the reviewer should perform this review. If there is at least one overpayment
error in the second Probe Sample, the reviewer should conduct a Full Sample in accordance with
the required confidence and prevision levels. If there are no errors in the second Probe Sample,
the review is complete.
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Question 18: How many
units must be reviewed as part of a Full Sample under a CIA Claims Review?
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There is no set number of units that the reviewer is
required to examine in the Full Sample. The Full Sample size is based on the mean and standard
deviation of the overpayment amount as calculated in the Probe or Discovery Sample. As a result,
the Full Sample must include a sufficient number of sampling units to yield results that estimate
the overpayment in the population to be within certain confidence and precision levels (e.g.,
90% confidence and 25% precision). The sample size will vary according to the variability of
the Probe or Discovery Sample and the size of the population.
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Question 19: Can the
units reviewed as part of the Probe or Discovery Sample be used as part of the Full Sample?
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Historically, the OIG has not allowed the Probe Sample
(as a whole) to be used as part of the Full Sample. However, the OIG will now allow, if statistically
appropriate, the Probe or Discovery Sample (as a whole) to be used as part of the Full sample.
For example, if the reviewer must examine 200 sampling units in the Full Sample, the reviewer
may use the results from each of the 50 units in the Discovery Sample. Therefore, the reviewer
only has to randomly select and review an additional 150 sampling units. The results of all units
reviewed as part of the complete Full Sample should be reported, i.e., 200 sampling units.
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Question 20: If a sampling
unit in the Full Sample has been underpaid, how should this be assessed when determining the
amount of the overpayment?
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For purposes of reporting the overpayment to the OIG,
underpayments may be netted (or offset) from overpayments. However, in terms of repaying the
overpayment to the appropriate payor, the provider should consult with that payor as to whether
it will allow underpayments to be netted from overpayments for collection purposes.
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Question 21: If the
actual precision for the Full Sample does not meet the 90% confidence and 25% precision threshold
(as stipulated in most CIAs), do additional sampling units need to be reviewed in order to
achieve the specified confidence and precision levels?
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If the sample size of the Claims Review was determined
by RAT-STATS or another statistical software package to reach a 90% confidence and 25% precision
level, and if the actual precision level exceeds 25% at the 90% confidence level, the reviewer
does not need to continue the review. The number of sampling units identified by statistical
software for review is an estimate that is based on the results of the Probe or Discovery Sample.
Because this is an estimate, some samples will achieve a precision better than 25% and some worse
than 25%.
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Question 22: What if
the number of sampling units estimated to yield the required confidence and precision levels
is unreasonably large?
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When there are few errors in the Probe or Discovery Sample, it is not uncommon for the Full Sample
size to be quite large. The reason for this is because, generally, the fewer errors in the sample,
the greater the variability of the sample. When the variability is large, the reviewer needs to
review more units to reach a reasonable level of confidence and precision. If the provider believes
the Full Sample size is unreasonably large, it should contact its OCIG monitor for further guidance.
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Question 23: Can the
Full Sample size be estimated based on paid amounts rather than overpayments (the dollar difference
between what was paid and what should have been paid)?
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No. Estimating the sample size based on paid amounts will yield an estimate of the sample size
needed to determine the actual amount paid, a figure already known. Instead, the objective is to
estimate the amount of the overpayment, thus the figures entered into the Full Sample size calculation
must be overpayment amounts.
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Question 24: When performing a Claims Review, if
supporting documentation for the unit that was randomly selected is not available, how should
this unit be evaluated?
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If the provider cannot produce supporting documentation for a unit that was selected, this unit
should be considered an error and the total amount paid should be considered the overpayment. It
is NOT permissible for the provider to remove this unit from the sample, to replace this unit with
a spare, or to consider that the service was properly coded, billed, and reimbursed.
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Question 25: Is it appropriate to use "alternate" or "spare" records
in the Claims Review?
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Generally, the use of alternates or spares is not permissible for CIA Claims Reviews, as stipulated
in current CIAs. If a record or supporting documentation cannot be located, the reviewer should
consider this item (e.g., claim, line item, encounter) to be an error/overpayment.
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Question 26: If the Claims Review provisions in
the CIA are no longer applicable due to changes in the Federal payment methodology, how should
the provider apply or implement the billing review provisions?
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CMS has implemented several payment changes to meet requirements mandated by the Balanced Budget
Act (BBA) of 1997. These requirements have an impact on the manner in which skilled nursing homes,
home health agencies, and hospital outpatient services are reimbursed. As a result, the CIA Claims
Review provisions established prior to implementation of the BBA may no longer be appropriate.
In these circumstances, the provider should contact the OCIG to discuss revising the Claims Review
provisions to honor the intent and spirit of the CIA or Agreement.
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Question 27: If a provider receives payment under
a Medicare or Medicaid Managed Care plan, should the managed care claims be included in the Claims
Review?
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No. Because the payment methodology of managed care plans typically differs from the traditional
Medicare and Medicaid payment methodologies, the reviewer should not include managed care claims
in its population of claims to be reviewed in the context of a CIA Claims Review.
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Question 28: What is a Systems Review?
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The purpose of the Systems Review is to identify problems and weaknesses that resulted in overpayments.
A Systems Review is a ‘walk through' of the systems(s) and process(es) that generated the
sampling unit in error.
For example, if a sampling unit was overpaid, the reviewer should begin by determining whether
it was initially coded correctly. If it was incorrectly coded, the provider should discuss the
incorrect code assignment with the person responsible for assigning the code and take appropriate
actions (e.g., training). If the code was correctly assigned on the source document, the reviewer
should verify that it was correctly entered into the system. If correctly entered into the system,
the reviewer may need to review the Chargemaster or other computer software to ensure the code
entered was correctly ‘cross-walked' to the code that should have been billed. The goal of
the Systems Review is to identify at what point the error that resulted in the overpayment occurred
and to determine why. The provider should then take any necessary steps to prevent such problems
in the future.
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Question 29: When should a Systems Review be performed?
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If a Full Sample is required, regardless if the reviewer has performed a Probe Sample or a Discovery
Sample, a Systems Review should be performed. See question 17 to determine when a Full Sample is
required.
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Question 30: What should be reported to the OIG
as a result of the Systems Review?
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The Systems Review Report should include the reviewer's observations, findings and recommendations
on possible improvements to the system(s) and process(es) that generated the overpayments.
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OIG
Site Visits
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The OIG monitors hundreds of providers, practitioners, suppliers, payors and other entities that
operate under CIAs. Since 1999, the OIG has conducted site visits as part of its CIA monitoring
efforts. The following are frequently asked questions regarding these site visits.
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Question 1: What is
the purpose of a site visit?
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The primary purpose of a site visit is to verify the entity's compliance with the terms of its
OIG integrity agreement or CIA and to provide the OIG with an opportunity to observe an entity's
compliance program in practice. The first hand observations obtained while on site provide
the OIG with a more accurate and comprehensive assessment of an entity's compliance
program. The site visit also offers the entity the unique, one on one opportunity to educate the
OIG regarding the entity's operations. Additionally, the OIG has found that site visits help
foster increased and more effective communication between the entity and the OIG.
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Question 2: Who is subject to an
OIG site visit?
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Any provider, practitioner, or entity currently under a CIA or other integrity agreement with
the
OIG is potentially subject to a site visit. Additionally, the OIG occasionally conducts site visits
to assess an entity's compliance program during the course of settlement agreement and CIA
negotiations. Entities previously visited include hospitals, physician offices, nursing facilities,
laboratories, third party billing companies, Medicare contractors, ambulance companies,
DME suppliers and home health agencies.
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Question 3: How are entities selected
for an OIG site visit?
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Entities selected for a site visit are chosen both at
random and based on specific criteria
developed by OIG. Factors considered by the OIG in determining whether to conduct a site
visit include: issues raised in CIA annual reports, the reporting of deficiencies,
comprehensiveness of the compliance program, size of operation, provider type, and degree
of cooperation when reporting or responding to OIG requests for information.
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Question 4: Who from the OIG conducts
the site visit?
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The visits are conducted by attorneys and/or program analysts from the Office of Counsel to
the Inspector General. In the past, a number of site visits were also conducted on the OIG's
behalf by a Program Safeguard Contractor for the Centers for Medicare and Medicaid
Services (CMS), formerly known as the Health Care Financing Administration.
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Question 5: How long does a site
visit typically last?
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The average site visit lasts between one and a half
to two days. Occasionally, for large
entities, site visits may last for three days or more.
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Question 6: With regard to site
visit scheduling, does the OIG conduct unannounced or
surprise site visits in connection with its CIA monitoring responsibilities?
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No. The OIG provides entities with advance notice of
about 2 weeks and coordinates the
scheduling of the site visit with the entity to minimize disruption to business operations.
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Question 7: What typically occurs
during a site visit?
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Each site visit is tailored to reflect the particular
structure of the entity and the issues identified by the OIG in monitoring the entity's compliance
with the CIA. Therefore, no two site visits are exactly alike. In general, discussions and issues
during an OIG site visit often include:
A presentation by the entity that includes:
an overview of the entity's corporate structure and operational organization;
an overview of the entity's coding and billing systems;
an overview of the entity's compliance efforts; and
a discussion of compliance efforts specific to coding, billing and medical record documentation;
A tour of the pertinent portions of the facility;
A review of the disclosure log, training sign in sheets, Ineligible Persons screening results
and other pertinent documentation;
Employee interviews regarding the entity's compliance program and its adherence to the terms
of its CIA or integrity agreement;
A discussion of the entity's annual report, CIA deficiencies, and corrective actions; and
A discussion of the OIG's site visit observations.
Because one of the primary purposes of a site visit is to provide the OIG with an opportunity
to observe the daily operations of the entity and its compliance program, the OIG does not
expect or encourage entities to spend excessive time or resources developing slide
presentations or preparing employees for interviews. Instead, the OIG's main recommendation regarding
site visit preparation is that the entity arrange to have employees reasonably available for discussions
or to answer questions. Typically, the entity's Compliance Officer and often one other member of
senior management accompany the OIG representatives throughout the site visit and are available
to answer questions. Through this less formal approach, the OIG has found that its site visits
cause minimal disruption to the entity's normal business operations.
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Question 8: Who is present during
the employee interviews?
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During its site visits, the OIG encourages a candid exchange of information. Thus, the OIG often conducts employee interviews in a one on one format. Employees may, if they so choose, have a representative from the entity present during the interview. The OIG often requests that the entity representative be someone other than the Compliance Officer because questions asked during the interview may specifically relate to the performance of the Compliance Officer and the Compliance Department.
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Question 9: Does the OIG conduct
a claims review during the site visit?
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The OIG typically does not conduct claims reviews during
site visits. However, the OIG or a duly authorized representative does have the authority in
accordance with the OIG Inspection, Audit, and Review Rights section of the CIA to conduct a
claims review at any time during the course of the CIA. In the past the OIG used a contractor
to perform such reviews and often these reviews were performed and finalized before the OIG went
on site so the OIG could discuss the results with the provider during the site visit. The OIG
continues to use the OIG’s Office of Audit Services and applicable Medicare contractors
to conduct claims reviews on an as needed basis.
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Provider
Obligations When a Contractor is Suspended by GSA
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Question: If a provider under a corporate
integrity agreement (CIA) is engaged in Federal health care program business with a contractor,
such as an auditing or CPA firm, that is subject to a government-wide suspension imposed by
the General Services Administration (GSA), what are the provider's obligations?
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As a general rule, the suspension of a contractor by
GSA invokes the "Ineligible Persons" provision of a provider's CIA. The CIA would require a provider
to remove an Ineligible Person from "responsibility for, or involvement with" the provider's "business
operations related to the Federal health care programs." A provider is also required to remove
an Ineligible Person from any position for which its compensation would be "paid in whole or
part, directly or indirectly, by Federal health care programs or otherwise with Federal funds." This
issue has arisen as a result of GSA's recent suspension of Arthur Andersen (Andersen), an auditing
firm that has been engaged as an independent review organization (IRO) by a number of providers
under CIAs.
The OIG recognizes the difficult and unusual circumstances
Andersen's suspension has created. In the interest of causing minimal disruption to providers'
ongoing business operations and reducing the financial burden to providers of having to engage
another firm to duplicate work already performed by Andersen, the OIG has decided to waive the
CIA requirements that would result in immediate cessation of Andersen's involvement in the provider's
Federal health care program operations. The intent of this waiver is to allow Andersen to continue
existing IRO and other engagements, but consistent with Federal regulations regarding the effect
of suspension, would bar a provider from entering into, renewing, or extending engagements with
Andersen. This waiver applies only to this particular situation involving GSA's suspension of
Andersen.
Pursuant to providers' Settlement Agreements with the
OIG and the U.S. Department of Justice, providers generally are not permitted to charge any of
their IRO costs to the Federal health care programs. This requirement is unchanged as a result
of OIG's decision to allow a provider to continue using Andersen to complete an existing IRO
engagement. In addition, if a provider has other engagements with Andersen, the provider should
confirm with the Centers for Medicare and Medicaid Services whether the provider has any additional
obligations with respect to Andersen flowing from its Medicare provider agreement.
If the OIG is aware that a particular provider has previously
retained Andersen as its IRO, the provider can expect to receive a letter from the Compliance
Unit of the Civil Recoveries Branch in the Office of Counsel to the Inspector General evaluating
the provider's CIA to determine the application of the Ineligible Persons provisions to Andersen's
suspension. If a provider has any questions or concerns regarding (i) this FAQ, or (ii) any existing
or potential relationships with Andersen or any other contractor subject to a suspension by GSA,
the provider should contact the Compliance Unit by calling (202) 619-2078.
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FOOTNOTE
1. If the provider is using
more than one universe (i.e., separate universes for Medicare and Medicaid) relevant information
for both universes should be provided.
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