Rex Hospital Incorrectly Billed Medicare Inpatient Claims With Kwashiorkor

Rex Hospital (The Hospital), in Raleigh North Carolina, did not comply with Medicare requirements for billing Kwashiorkor on any of the 109 claims that we reviewed. The Hospital used diagnosis code 260 for Kwashiorkor but should have billed either other forms of malnutrition or no malnutrition at all. For 5 of the inpatient claims, substituting a more appropriate diagnosis code produced no change in the DRG payment amount. However, for the remaining 104 inpatient claims, the errors resulted in overpayments of $392,000. Hospital officials attributed these errors to a lack of clarity in the coding guidelines.