Sneak Preview: N.Y. Aims To Recoup Ancillary Service Overpayments

June 3, 2014 | By Jerry Ashworth | Post a Comment

xsass_bookshot(The following was excerpted from an article in the Single Audit Information Service.) After a recent New York Office of State Comptroller audit identified about $1.4 million in improper payments for ancillary services claims from April 2012 to September 2013, the New York Department of Health plans to update its Medicaid claims processing system to better identify improper claims. .

Ancillary services are health care services that are provided at a home, at medical offices or in clinics and that can be classified as diagnostic, therapeutic or custodial (e.g., laboratory services, physical therapy, home health care). In New York, Medicaid claims for such services are processed by eMedNY, NYDOH’s automated claims processing system. The system conducts occasional “edits,” or specific evaluations, on claims to determine if they comply with the department’s Medicaid reimbursement policies, including oversight to ensure patient eligibility and medical necessity, as well as monitoring to prevent duplicate claims for the same service. The department does not reimburse claims for ancillary services provided during a hospital admission.

Although OSC determined that eMedNY accurately detected and denied most improper Medicaid claims for ancillary services, it did identify about $1.4 million in improper payment claims that the department should review and recover. This includes 9,821 improper claim payments totaling about $1 million that eMedNY identified in two edits of the system. Although these improper payments were reported to NYDOH officials, the department has yet to seek recovery of the payments. In addition, OSC found that eMedNY did not detect about 6,000 other improper claims for Medicaid ancillary services totaling about $368,000 that were provided to recipients covered by Medicare.

For example, a recipient was admitted to a hospital in May 2013 for 16 days, and Medicaid paid $23,000 for the related inpatient claim. However, the patient received three ancillary services for which Medicaid also paid about $11,000. “The provider should not have submitted separate claims for the ancillary services because the recipient was already an inpatient at the time the services were provided, and the inpatient claim payment covered all services provided during that admission,” OSC said. “eMedNY did not prevent the improper payment because the claims for the ancillary services were adjudicated before eMedNY processed the claim.”

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