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Audit (A-05-08-00061)

06-22-2009
Review of High-Dollar Payments for Inpatient Services Processed by Wisconsin Physicians Service for Calendar Years 2004 Through 2006-Hospitals With Fewer Than Five High-Dollar Payments

Executive Summary

We found that Wisconsin Physicians Service made net overpayments totaling $3.86 million to hospitals for inpatient services for calendar years 2004 through 2006. Contrary to Federal guidance, hospitals inaccurately reported the number of billing units for blood clotting factor, reported incorrect diagnosis and procedure codes, and reported excessive charges that resulted in inappropriate outlier payments. Hospitals attributed most of the incorrect claims to data entry errors and insufficient documentation. Wisconsin Physicians Service made these incorrect payments because neither the Fiscal Intermediary Standard System nor the Common Working File had sufficient edits in place to detect and prevent the overpayments.

We recommended that Wisconsin Physicians Service (1) recover the $3.86 million in identified net overpayments, (2) use the results of this audit in its provider education activities related to data entry procedures and proper documentation, and (3) consider implementing controls to identify and review all payments greater than $200,000 for inpatient services. In written comments on our draft report, Wisconsin Physicians Service described corrective actions that it had taken or planned to take to implement our recommendations.

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