New Developments in OIG and CMS Compliance Audits

By Tricia A. Shackelford, Esq. | June 20, 2022

As we approach the third quarter of 2022, it appears that life is beginning to normalize.  The initial response of the Department for Health and Human Services to the COVID-19 crisis was geared toward providing a safety net for our healthcare system.  Earlier this year, however, the Office of Inspector General (the “OIG”) announced that it will be undertaking a series of audits of laboratory billing to the Medicare program for COVID-19 related testing.  

The OIG will also be conducting trend analyses on laboratory billing for COVID-19 add-on testing.  These analyses will focus on testing performed in conjunction with COVID-19 testing to confirm or rule out diagnoses other than COVID-19.  Regulators will focus on concerns of fraudulent billing for specific add-one testing, to include: respiratory pathogen panel (“RPP”) tests, allergy tests, and genetic tests.  Add-on testing is a focal point as a result of the Centers for Medicare and Medicaid Services (“CMS”) eliminating the requirement for an order from a physician or treating provider for COVID-19 testing created potential for system abuse.  Pursuant to the OIG, “relaxation of the physician/non-physician practitioner ordering rules could allow unscrupulous actors more leeway for fraudulent billing of unnecessary add-on testing.”

Healthcare providers need to be aware of these new enforcement initiatives and begin to prepare for the possibility of an audit.  An internal audit should focus on the following: 

  • did the provider perform laboratory tests that were eligible for Medicare reimbursement;
  • was it appropriate to bill Medicare for travel and collection of specimens; and
  • did the provider properly document the tests it performed?

It is important to note that Medicare covers only diagnostic COVID-19 testing, meaning that only tests performed on a patient who has exhibited COVID-19 symptoms or who was exposed to COVID-19 are eligible for reimbursement.  Tests performed solely to monitor community spread are not covered by Medicare.  Additionally, Medicare covers only  tests that are medically necessary.  If other tests were added on to COVID-19 testing, the OIG may review each individual test for medical necessity.  Providers will risk sanctions if the OIG determines that add-on tests were not medically necessary.

The COVID-19 pandemic has pushed our healthcare system to its breaking point.  The addition of the OIG audits and trend analyses places yet another burden on a system that is already stretched too thin.  Providers should consider implementing a routine records review as a part of their compliance programs.  Such a policy supports facilities in identifying and rectifying problem areas before a government audit or investigation.  

We routinely assist clients with audits (both internal and external) and investigations and ensure compliance with all applicable laws and regulations.  For assistance with these or any other healthcare matter, call us today!


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