Hospital System $60 Billion in Improper Payments Crackdown; Fi-Med Spots “Behavioral” Coding Issues

The $60 billion in improper payments to private Medicare Advantage health plans and Medicare in 2016 was nearly twice the amount spent on medical research by the National Institutes of Health. 3 Incorrect coding is to blame in 42% of improper claims submitted to Medicare in 2016 and 80% of medical bill overpayments to providers. The cost to the nation is a whopping $68 billion annually. It’s not uncommon for hospital systems to track and commit hundreds of hours of staff time to comply with directives from a compliance audit.1 The audits, generated by Medicare to recoup revenue, follow patterns of overpayments to hospital providers. Fi-Med, a leader in predictive analytics and compliance tools for hospitals and large health networks, says technology to locate “behavioral” coding issues can prevent incorrect billing, saving hospital networks millions of dollars.

Changing healthcare industry standards and hospital staff shortages are leading to incorrect coding which is required for accurate government reimbursement for services. Also cited as reasons behind billing errors are duplicate charges for hospital services and procedures, canceled tests, incorrect patient information, upcoding charges, unbundling of charges, and operating room/anesthesia time. 4

Medicare’s watchdog, the Medicare Fee for Service (FFS) Recovery Audit Program, works to identify and correct improper payments through the detection and collection of overpayments made on claims of health care services provided to Medicare beneficiaries, and the identification of underpayments. 2

In an effort to avoid the resulting audits, some hospital physicians deliberately process underpayments. This generates decreased revenues for the hospital in return for a greater chance at avoiding audits – either way the lost revenue impacts the quality of…

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