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Department of Health and Human Services

Office of Inspector General -- AUDIT

"Claim Payment Adjustments Identified by Quality Improvement Organizations," (A-03-06-00005)

November 29, 2007

PDF File Complete Text of Report is available in PDF format (543 kb). Copies can also be obtained by contacting the Office of Public Affairs at 202-619-1343.


Fiscal intermediaries properly processed the majority of payment adjustments for claims referred by the quality improvement organizations (QIO).  Specifically, fiscal intermediaries properly adjusted 3,440 (96.4 percent) of the 3,568 claims referred based on the QIOs’ case reviews and final determinations during the fiscal year (FY) 2005 Hospital Payment Monitoring Program (HPMP).  The 3,440 adjusted claims had net overpayments totaling $9,247,343, or 95.5 percent of the $9,684,299 in net overpayments requiring adjustment.  However, fiscal intermediaries did not properly adjust 128 claims with net overpayments totaling $415,677.

We recommended that the Centers for Medicare & Medicaid Services (CMS) (1) instruct fiscal intermediaries to recover $415,677 for 128 claims with errors identified during the FY 2005 HPMP that were either not adjusted or only partially adjusted and (2) follow up with the QIOs and fiscal intermediaries when adjustments are not processed promptly.  CMS agreed with our first recommendation and disagreed with our second recommendation.