Review of Billing Under the Home Health Prospective Payment System for Therapy Services

EXECUTIVE SUMMARY:

Our objective was to determine if Oxford's claims with 10-12 therapy visits complied with Federal regulations and guidance.  Oxford's claims with 10-12 therapy visits did not always comply with Federal regulations and guidance.  Of 100 statistically sampled claims reviewed by medical professionals, 50 claims had errors (6 claims had 2 errors) that caused the Medicare payment amounts to be incorrect.  Oxford had inadequate quality assurance procedures to ensure that the claims were for medically necessary services and properly authorized therapy services, and that it correctly assessed the beneficiary's health status.  As a result, we estimate that $685,406, of the $3,021,489 that Oxford received for the 851 therapy claims, is unallowable.  We recommended that Oxford:  (1) refund $685,406 to the Medicare program; (2)   identify and submit adjusted home health claims for Medicare overpayments received subsequent to our audit period; and (3) strengthen controls to ensure that all claims are for medically necessary services and properly authorized therapy services, and that it correctly assesses the beneficiary's health status.

In its response, Oxford disagreed with many of the medical review determinations and with the recommended amount.  However, Oxford agreed to strengthen its control processes.