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Department of Health and Human Services

Office of Inspector General -- AUDIT

"Review of Billing Procedures for Medicare Claims Submitted to Palmetto GBA by Inpatient Psychiatric Facilities During 2005," (A-01-07-00507)

July 19, 2007

PDF FileComplete Text of Report is available in PDF format (648 kb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


Our objective was to determine whether inpatient psychiatric facilities (IPF) properly submitted Medicare claims paid by Palmetto GBA (Palmetto) for transition stays.  IPFs did not always properly bill claims paid by Palmetto for transition stays in 2005.  Specifically, for 77 of the 100 claims that we sampled (from the population of 226 claims), IPFs incorrectly split the beneficiary’s stay by submitting 1 claim under the Tax Equity and Fiscal Responsibility Act of 1982 payment period and a second claim under the prospective payment period, rather than properly submitting 1 claim for the entire inpatient stay.  Based on our sample results, we estimate that Palmetto overpaid IPFs a total of $706,285 for incorrectly billed Medicare claims for transition stays in 2005.

We recommended that Palmetto (1) make the appropriate adjustments to the sampled claims that resulted in overpayments of $312,516, (2) review our information on the additional 126 claims with potential overpayments estimated at $393,769 ($706,285 less $312,516) and work with the IPFs that provided the services to recover any overpayments, and (3) analyze postpayment data from IPF claims submitted after our review to ensure that the claims were billed properly and paid correctly by Palmetto.  Palmetto agreed with our findings and recommendations and stated that it was taking appropriate action.