Review of Medicare Transitional Pass-Through Payments Made Under The Hospital Outpatient Prospective Payment System for Drugs, Biologicals, and Medical Devices at Lehigh Valley Hospital

EXECUTIVE SUMMARY:

The objective of this review was to determine whether transition pass-through payments for drugs, biologicals, and medical devices were reimbursed in accordance with Medicare laws and regulations.  Based on our review of payments to Lehigh Valley Hospital (LVH) for 100 sampled items, we found, with minor exceptions, that LVH complied with Medicare laws and regulations for billing transitional pass-through drugs, biologicals and medical devices.  These minor exceptions had an insignificant effect on the overall Medicare reimbursement.  To prevent such errors from occurring in the future, we recommend that LVH use the results of our audit to stress to its employees the need to use correct data in generating Medicare claims.