Review of Separately Billed Laboratory Tests Paid by National Government Services, Inc., for Medicare Beneficiaries With End-Stage Renal Disease

Medicare claims paid by National Government Services, Inc. (NGS), for laboratory tests that dialysis facilities provided to end-stage renal disease (ESRD) beneficiaries did not always comply with Medicare ESRD payment requirements. ESRD-related laboratory tests were correctly billed and paid in 90 of the 360 beneficiary quarters that we sampled. However, for the remaining 270 beneficiary quarters, dialysis facilities incorrectly billed and were reimbursed $11,000 for ESRD-related laboratory tests. Based on our sample results, we estimated that NGS overpaid dialysis facilities $3.9 million for laboratory tests provided to ESRD beneficiaries during calendar years 2004-2006.

We recommended that NGS coordinate with the Centers for Medicare & Medicaid Services and other involved Medicare administrative contractors to (1) conduct postpayment medical record reviews of claims submitted by dialysis facilities that separately billed ESRD laboratory tests to identify and recover overpayments estimated at $3.9 million and (2) educate dialysis facilities about Medicare ESRD billing requirements related to the types of errors identified in our review.

In its comments on our draft report, NGS agreed with our recommendations. However, NGS noted that it no longer has jurisdiction over 2 of the 12 contracts covered by our review. We have modified our recommendations accordingly.