More Than Meets the Eye: Taking a Deeper Look at 2015 OIG Work Plan Analysis for Laboratories

It is an error to review the single item directly addressed to laboratories in the Health and Human Services Office of Inspector General (OIG) Work Plan for fiscal year 2015 and believe that only independent laboratories are affected.

The brief item titled Selected independent clinical laboratories billing requirements (new) says the OIG will review Medicare payments for these laboratories for selected billing requirements but does not identify what those requirements are. It also says that prior OIG work has identified areas of Medicare billing compliance risks for laboratories. It is this prior work that laboratories should be concerned about.

Prior OIG Reviews of Part B Laboratory Billing
One of the more likely reviews is the July 2014 report titled Questionable Billing for Medicare Part B Clinical Laboratory Services. In this report, the OIG identifies 13 measures describing billing patterns that it regards as questionable. Over 1,000 labs exceeded these measures in five or more of the questionable billing measures, indicating there may be a problem in those labs. This is a good starting point for the OIG. See the July 2014 issue of G2 Compliance Advisor for an article on this review and report.

Another report that could be considered by the OIG is the Comparative Billing Report on pathology immunohistochemical and special stains. This report identifies 5,000 labs that may have a billing problem. The difference with this case is that the labs identified received a specific and detailed report indicating each laboratory’s specific area of risk. For details on this report, see the August 2014 issue of G2 Compliance Advisor.

Other Area Identified in the Work Plan That May Affect Laboratories

Not everything that could affect laboratories is identified as an area of risk for laboratories. For instance, there is an item in the Medicaid section that says the OIG will review the Centers for Medicare and Medicaid Services oversight of implementation of the Correct Coding Initiative (CCI) edits by Medicaid contractors. Previously, Medicaid contractors could turn off the edits for reasons that included conflict with state laws or just because the state wasn’t ready to implement them. After April 1, 2011, Medicaid contractors could not use “not ready to implement” as a reason to deactivate the edits. This likely means more emphasis on CCI edits for Medicaid claims and the consequences of that action. In fact, there are a number of Medicaid items in the Work Plan.

The Work Plan also includes several items for Medicare and Medicaid managed care entities. One item, Medicaid managed care entities’ identification of fraud and abuse says that over a quarter of managed care entities surveyed did not report a single case of fraud in 2009.

It is a certainty that these reviews will be the result of data mining independent lab claims using algorithms previously determined to detect areas of risk for noncompliance with Medicare and Medicaid billing requirements. After all, data mining is now an essential tool for fraud-fighting efforts.

Takeaway: Laboratory compliance officers need to conduct a thorough review of the OIG Work Plan in all areas, not just specific to laboratories, to detect the multitude of seemingly unrelated items that may ultimately affect laboratories in 2015.

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