Review of St. Jude Behavior Health Center's Partial Hospitalization Program

EXECUTIVE SUMMARY:

This final report provides the results of our review of St. Jude Behavioral Health Center's Partial Hospitalization Program. Medicare covers partial hospitalization services to eligible beneficiaries for services that are reasonable and necessary for the diagnosis and treatment of an individual's mental condition and reasonably expected to improve or maintain the individual's functional level to prevent relapse or hospitalization.

The objective of our review was to determine whether the partial hospitalization services claimed by the provider in the 12-month period ended December 31, 1996 met the Medicare eligibility and reimbursement requirements.

Our review showed that for the 12-month period ended December 31, 1996, St. Jude was paid $927,845 for services that did not meet the Medicare eligibility and reimbursement criteria.

We reviewed a judgmental sample of 20 beneficiaries who received partial hospitalization (PHP) services during the 12-month period ended December 31, 1996 at St. Jude Behavioral Health Center (St. Jude). The review showed that all of the services claimed for the 20 beneficiaries did not meet the Medicare eligibility and reimbursement criteria.

The 20 beneficiaries did not meet the eligibility criteria for admission to the PHP, received services from unlicensed staff, and received services that were not reasonable and necessary for the patients' conditions.

We believe that the unallowable claims were submitted because the provider did not adhere to Medicare guidelines. Also, the Fiscal Intermediary's (FI) policies to identify improperly billed services may be inadequate. Based on the results of our review, we recommend that the Health Care Financing Administration (HCFA) instruct the FI to:

• initiate recovery action against the provider for the $927,845 overpayment, and
• monitor the PHP providers to ensure that proper reimbursement procedures are followed.

The HCFA generally concurred with these recommendations. The HCFA's response is included in its entirety in Appendix A of this report.