When the Department of Health and Human Services (HHS) Office of Inspector General (OIG) released its 2015 Work Plan (pdf) late last year, one of planned areas of focus for investigation and enforcement activities OIG indicated it planned to pursue during the current fiscal year and beyond should be of interest to nephrology practices and those organizations providing services that require nephrology billing.

The OIG stated it will review Medicare payments for and utilization of renal dialysis services and related drugs pursuant to the new bundled end-stage renal disease (ESRD) prospective payment system (PPS).

It will compare facilities’ acquisition costs for certain drugs to inflation-adjusted cost estimates and determine how costs for the drugs have changed. The Centers for Medicare & Medicaid Services (CMS) has based the ESRD PPS price updates on wage and price proxy data from the Bureau of Labor Statistics, but OIG noted that it previously found data from BLS did not accurately measure changes in facilities’ acquisition costs for high-dollar ESRD drugs.

In January 1, 2011, federal law required CMS to begin implementation of a new system that bundles all costs related to ESRD care (including drugs that were previously separately billable) into a single per-treatment payment.

As a report from law firm McGuireWoods notes, “The OIG’s findings may impact future calls for ESRD payment changes.”

OIG separately noted that it would examine Medicare claims data to assess the extent of questionable billing for ambulance services, such as transports that potentially never occurred or potentially were medically unnecessary transports to dialysis facilities. It will also work to determine whether Medicare payments for ambulance services were made in accordance with Medicare requirements. Prior OIG work found Medicare made inappropriate payments for advanced life support emergency transports.

Medicare pays for emergency and nonemergency ambulance services when a beneficiary’s medical condition at the time of transport is such that other means of transportation are contraindicated (i.e., would endanger the beneficiary).