The U.S. Department of Health & Human Services (HHS) Office of Inspector General (OIG) has released a report that National Government Services (NGS), the Jurisdiction B Durable Medical Equipment Medicare Administrative Contractor (DME MAC) paid lower-limb prosthetic claims that did not meet requirements set forth in local coverage determinations (LCDs) for the period of January 1, 2009, through September 30, 2012.
The OIG found that NGS paid $1,461,464 for 770 lines of service that did not meet LCD requirements: $1,418,407 for 682 lines of service that had missing or incorrect functional level modifiers and $43,057 for 88 lines of service that had unallowable combinations of components.
When NGS paid the claims for these lines of service, it did not have claim-processing edits in place to evaluate whether they met all the LCD requirements, the OIG reported. However, NGS implemented and improved edits throughout the OIG audit period. and ThisEdits were was donemade in response to a Technical Direction Letter (TDL) that was issued March 5, 2012, by the Centers for Medicare & Medicaid Services (CMS), which directing directed DME MACs to develop claim-processing edits for all LCD requirements for lower-limb prostheses. Of the 770 lines of service OIG identified that did not meet LCD requirements, NGS paid for 29 lines of service after implementation of its latest updated edits.
The OIG recommended that NGS recover the $1,461,464 and that it continue to monitor the edits it developed and updated in response to CMS’s March 2012 TDL. In response, NGS told OIG that it issued overpayment requests for all of the claim lines identified in this the report and that it has so far recouped $1,365,822. NGS also said described corrective actions that it had taken to implement and improve its claim-processing edits and that it would review existing edits to determine their effectiveness.