Four Medicare contractors wrongly paid three of every four audited reimbursement claims for test strips and lancets commonly used by diabetes patients, at a cost to taxpayers in excess of paid more than $271 million, according to the U.S. Department of Health and Human Services Inspector-General.
The HHS IG audited 400 claims paid in 2007, and found that only 97, or 24 percent, were properly documented, as required by Medicare. Of the remaining 303, 222 of them paid for too many supplies without providing required justifications, 117 had no documentation of refill orders, 90 lacked physician documentation, and there was no proof of delivery for 33 claims.
Errors were made on 76 percent of the audited claims because, according to the HHS IG, "because the contractors did not have controls to ensure that claims for test strips and/or lancets complied with certain Medicare documentation requirements" for the most frequently submitted claims or for those with overlapping service dates for the same person.
"The contractors could have saved Medicare an estimated $209 million for CY 2007 if they had had controls to ensure that claims for test strips and/or lancets complied with certain Medicare documentation requirements. Adequate controls are important to program integrity because they help to prevent improper payments to suppliers for test strips and lancets. Unless the contractors implement system edits to identify for further review high utilization claims and claims that have overlapping service dates for the same beneficiary, they are likely to continue to make improper payments to suppliers," the IG report said.
Medicare pays an estimated $1.2 billion annually on reimbursements for diabetes-related test strips and lancets, according to the IG.
Acting Medicare and Medicaid Services Administrator Marilyn Tavenner agreed with the IG report and recommendations and said fixes are being implemented. She did not, however, provide an estimate of the cost of those fixes or when they would be fully implemented.
Mark Tapscott is Executive Editor at The Washington Examiner