The OIG has recently released its 2007 Work Plan, which contains many targeted areas already identified in their previous work plans, as well as several new areas of investigation for the upcoming year.  Below you will find a summary of the OIG's targeted concerns for the upcoming year.

For Physicians:

Billing Service Companies - The relationship between billing companies and physicians, as well as non-physician providers, will be examined by the Office of the Inspector General (OIG) to determine if these relationships are affecting how the provider bills their services to Medicare (i.e., level of coding, modifiers, etc.)

Physical (PT) and Occupational (OT) Therapy- The OIG will be examining PT and OT services provided to Medicare patients to determine whether there is appropriate documentation to support medical necessity and that a physician certified the services.  The OIG will also be investigating CMS's claims processing system to ensure it is able to identify potential duplicate PT and OT claims.

"Incident to" Services – Services billed as “Incident To” will be investigated to determine if they meet the criteria of "Incident to" billing standards, documentation requirements, as well as quality of care requirements.

E&M Services Rendered During A Global Period - The OIG will determine whether physicians have billed and been erroneously paid for E&M services provided during a global surgical period.  They will also be studying the effect of the changes made since 1992 when the global period rules were implemented and how it has changed the number of services billed but not paid out during the global period

Assignment Rules - Providers who accept assignment must accept Medicare payments and the beneficiary's co-insurance and deductible as payment in full.  In 2007, the OIG plans to examine the extent to which providers are charging Medicare beneficiaries for amounts in excess of the Medicare allowed amount.  The OIG will also determine to what extent Medicare beneficiaries have been educated by CMS and their physicians regarding their rights and responsibilities when it comes to billing violations.

Cardiologic Testing - Claims for cardiography and echocardiography services will be investigated by the OIG to determine whether providers are properly billing the professional and technical components of these services.

Advanced Imaging Services Provided in the Physicians Office - With utilization growing each year for these services, the OIG plans to examine the appropriateness of having advanced imaging services (i.e. MRI, PET, and CT scans) provided in an office setting.

Some other areas of interest for physicians on the 2007 Work Plan include physician pathology service, eye surgeries, wound care, Part B mental health services, payment for the "Welcome to Medicare" exam, reimbursement for polysomnography, and long distance physician services associated with home health and skilled nursing facilities.

For Hospitals:

Inpatient Payments for New Technologies - These increased payments are for medical services and technologies that meet the criteria of being "new" but have been proven to be inadequately paid under the current DRG system.  The OIG will investigate to ensure these payments are being made appropriately.

Capital Payments - The OIG will investigate the appropriateness and accuracy of the methodology used to update the rates for capital payments.  In addition, they will be investigating whether or not hospitals have been using these capital payments for their intended purpose. 

Rebates - The OIG will be examining a sample of Medicare Cost Reports to determine whether hospitals are reporting purchase credit rebates appropriately as a separate line item.  They will also be visiting large vendors to investigate the amount of rebates that have been paid to hospitals in a given year.  Their goal is to ensure that the rebates have been properly accounted for on the Cost Reports submissions.

Long Term Care Classification - Hospitals that are classified as Long Term Care Hospitals must have an average length of stay of at least 25 days.  The OIG plans to investigate whether hospitals currently being reimbursed as Long Term Care Hospital facilities are in compliance with required length of stay criteria.

Unbundling of Hospital Outpatient Services - The OIG will investigate to what extent hospitals are inappropriately unbundling coding for outpatient services claims.

Coding of DRG Services - Provider claims that show high or unusual patterns of DRG selection will be analyzed by the OIG to determine if the appropriate medical necessity has been documented and that the correct level of code was selected.

Additional areas of interest for the OIG in 2007 for hospitals include long term care hospital admissions, critical access hospitals, outpatient department payments, specialty hospitals, and inpatient rehabilitation facility compliance.

For a copy of the 2007 OIG Work Plan, please visit the OIG website at:

http://oig.hhs.gov/publications/docs/workplan/2007/Work Plan 2007.pdf.

Please keep in mind that it is always in the best interest of your practice to have written Policies and Procedures to ensure that you are making a diligent effort to be compliant. Please contact the Healthcare Advisory Services Group at Margolis & Company at (610) 667-6250 and ask for more information about how we can assist you with your Policies and Procedures or with understanding and implementing federal and state regulations.

Lawrence S. Simon, CPA is Co-Chair of our Healthcare Services Group and has over twenty-five years of experience serving the healthcare industry. Larry can be reached at lsimon@marg.com.