Butler Memorial Hospital Incorrectly Billed Medicare Inpatient Claims With Kwashiorkor

Butler Memorial Hospital (The Hospital), in Butler, Pennsylvania, did not comply with Medicare requirements for billing Kwashiorkor on any of the 91 claims that we reviewed. The Hospital used diagnosis code 260 for Kwashiorkor but should have used codes for other forms of malnutrition. For 48 of the inpatient claims, correcting the diagnosis code resulted in no change in the payment. However, for the remaining 43 inpatient claims, the errors resulted in overpayments of $130,000. Hospital officials attributed these errors to a misinterpretation of the coding guidelines for malnutrition that was brought to their attention by an external audit conducted in April 2010.