Review of Rural Health Clinic Medicare Claims for Calendar Years 1997,1998, and 1999

This report points out potential Medicare overpayments totaling approximately $2.8 million were paid to rural health clinics (RHC) in 13 States for Calendar Years 1997 through 1999. The potential improper payments were composed of $2.6 million in Part B billings for individual services that were covered and paid on the basis of an all-inclusive rate per visit, and $0.2 million in duplicate RHC claims for services provided to the same beneficiaries, for the same dates of service, and with the same diagnoses. In addition to financial adjustments, we are recommending that the Centers for Medicare and Medicaid Services (CMS) design and implement Common Working File edits to detect claims which contain Part B services that were paid under the all-inclusive rate. We are also recommending that CMS require the fiscal intermediaries to develop effective procedures and computer system edits to detect the submission of duplicate RHC claims.   The CMS agreed with all of our recommendations except for designing and implementing CWF edits. The CMS believed that this recommendation would result in additional administrative burdens. However, we believe that CWF edits would be the most effective way to correct problems found during the audit, without placing additional administrative burdens on RHCs.