On October 5, 2011, the U.S. Department of Health and Human Services Office of Inspector General (OIG) released its FY 2012 Work Plan.  The Work Plan outlines various projects and audits OIG plans to undertake in the new fiscal year in areas it believes are prone to noncompliance, fraud and abuse.  In addition to OIG's usual targets—reporting of adverse events, same-day readmissions—OIG also proposes to focus on the following areas:

  • Hospital-Specific Scrutiny of Inpatient and Outpatient Claims.  OIG will conduct audits of provider billing compliance, and instead of reporting its general findings and recommending overarching policy changes, OIG will recommend provider-specific overpayment recoveries.  OIG will use data mining and other computer matching techniques to select specific hospitals for "focused reviews of claims that may be at risk for overpayment."  OIG will rank hospitals as "most risky" and "least risky" in various compliance areas, and will review hospital billing policies to compare and contrast policies from each category of hospitals.
  • Review of Present-on-Admission (POA) Indicators.  OIG will review the accuracy of POA indicators previously submitted on inpatient claims in October 2008.  These indicators identify which conditions were present at the time of admission, and those that developed during the hospital stay.  OIG will use this data to inform other payment policies designed to reduce reimbursement for hospitals with high rates of hospital-acquired conditions.
  • Financial Relationships Between Hospitals and Hospices.  OIG also will review transfers from inpatient hospital care to inpatient hospice care, and examine the financial and/or common ownership relationships of these providers to determine if reimbursement is higher for these transfers than to other settings.
  • Hospital Billing for Replacement of Medical Devices.  OIG will examine claims for replacement medical devices.  OIG will investigate whether hospitals have received a warranty or other credit from device manufacturers, in which case Medicare should not pay the full cost of the device.  Such claims should contain a modifier indicating a manufacturer credit.
  • Physician Billing for "Incident-to" Services.  OIG will audit medical records to determine whether claims for "incident-to" services had higher error rates than claims for other services.  In particular, OIG is concerned that physicians are incorrectly billing for incident-to services performed by unqualified non-physician practitioners. 
  • Nursing Home Compliance Plans.  OIG will audit skilled nursing facility (SNF) compliance plans to evaluate implementation of OIG's compliance guidelines.

A copy of entire Work Plan is available by clicking here.