Medicare Compliance Review of NorthShore University HealthSystem for 2013 and 2014

NorthShore University HealthSystem (the Hospital) complied with Medicare billing requirements for 97 of the 190 inpatient and outpatient claims we reviewed. However, the Hospital did not fully comply with Medicare billing requirements for the remaining 93 claims, resulting in overpayments of $625,000 for CYs 2013 and 2014 (audit period). On the basis of our sample results, we estimated that the Hospital received overpayments totaling at least $4.1 million for the audit period. Overpayments occurred primarily because the Hospital did not have adequate controls to prevent the incorrect billing of Medicare claims within the selected risk areas that contained errors.

We recommended that the Hospital (1) refund to the Medicare contractor $4.1 million (of which $625,000 was overpayments identified in our sample) in estimated overpayments for incorrectly billed services, (2) exercise reasonable diligence to identify and return any additional similar overpayments outside of our audit period, in accordance with the 60-day rule, and identify any returned overpayments as having been made in accordance with this recommendation, and (3) strengthen controls to ensure full compliance with Medicare requirements. The Hospital generally disagreed with our findings and recommendations and described its corrective actions taken in response to our third recommendation.