Review of Outpatient Psychiatric Services Provided by the Elliot Hospital for the Fiscal Year Ending June 30, 1998

EXECUTIVE SUMMARY:

This final audit report points out that a significant amount of outpatient psychiatric claims made by Elliot hospital did not meet Medicare reimbursement requirements. Specifically, charges for psychiatric care were found to be medically unnecessary or were not properly supported by medical records. Based on a statistical sample, we estimate that at least $314,359 in outpatient psychiatric charges did not meet Medicare's requirements. We also identified $11,315 in costs ineligible for Medicare reimbursement claimed by the hospital on its Fiscal Year (FY) 1998 cost report for outpatient psychiatric services. We recommended that the hospital strengthen its procedures to ensure that charges for psychiatric services are covered and properly documented in accordance with Medicare requirements. We also recommended that the hospital establish nonreimbursable cost centers or otherwise exclude costs related to noncovered services from its Medicare cost reports. We will provide the results of our review to the fiscal intermediary so that it can apply the appropriate financial adjustments to the hospital's FY 1998 Medicare cost report.

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