Work Plan: OIG Targets Medicare Part B Urine Drug Testing

Falsely billing Medicare Part B for urine drug testing has loomed large on the OIG’s radar even before the opioid crackdown began. Last February, for example, the OIG issued a report claiming that CMS made over $66.3 million in improper payments for tests done to validate specimen samples, a form of testing not deemed medically necessary under Medicare coverage criteria. See Lab Compliance Advisor (LCA), April 10, 2018. And now the agency has made review of urine drug testing part of its Work Plan. According to the OIG, in 2028, urine drug and other lab testing had an improper payment rate of nearly 30%. The overpayment rate for definitive drug testing for 22 or more drug classes was 71.7%, it contends. Accordingly, the OIG says it will review urine drug test services provided to Medicare beneficiaries to determine whether they met all the rules and coverage criteria.

Among the other five new Work Plan items for October, two may indirectly affect at least some lab providers and companies. 

1. Hospice Inpatient and Aggregate Cap Calculations

Issue: There are two annual caps on Medicare payments to hospice providers. The inpatient cap limits the number of payable days of inpatient care to 20% of a hospice’s total Medicare patient care days and requires providers to refund any payment amounts above the cap within five months. The aggregate cap limits the total aggregate payments that an individual hospice can receive in a cap year based on an annual per-beneficiary cap amount and the number of beneficiaries served. As with the inpatient cap, providers must repay amounts exceeding the aggregate cap within five months.

OIG Action: The OIG will review Medicare administrative contractors (MACs) oversight of the cap process and determine whether hospices are remitting excess payments in full and in time.

2. FDA Postmarket Surveillance of Medical Devices

Issue: The FDA is getting more of the information it needs to assess medical device safety and effectiveness comes from the postmarket setting. That makes it more important than ever to ensure that the FDA’s postmarket safety surveillance system can effectively identify and act on safety signals.

OIG Action: The OIG will assess and describe how the FDA’s established passive postmarket surveillance system identifies, tracks and responds to safety concerns, and assess FDA’s response to those concerns. It will also describe how elements of the agency’s newer surveillance system initiatives, like the Unique Device Identification system, are being integrated into the passive postmarket surveillance system, and how FDA plans to integrate these initiatives into its in-development active postmarket surveillance system, aka, the National Evaluation System for health Technology.


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