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Medicare Compliance & Reimbursement

Hospitals:

4 ORGAN ACQUISITION COST REPORTING PITFALLS

Published on Fri May 16, 2003

The complexities of Medicare reimbursement for organ transplant centers are all too clear in a recent HHS Office of Inspector General review of a Tampa, FL hospital.

Titled "Review of Medicare Costs for Organ Acquisitions at Tampa General Hospital" (A-04-02-02017), the audit finds that TGH's cost report claim for $7 million was overstated by about $1.4 million in fiscal year 1999. Most of the excess resulted from an overstatement of the direct cost for kidney and liver acquisition combined with an understatement of the direct costs for heart acquisitions.

According to the OIG, the key problem areas were:

  • use of improper methods for reporting average organ acquisition costs;
  • improper allocation of employee benefits;
  • improper allocation of costs to the heart acquistion cost center; and
  • an unsupported claim for provider-based physician compensation.

    TGH disagreed with most of the OIG's conclusions.

    To see the report, go to http://oig.hhs.gov/oas/reports/region4/40202017.pdf.

    Lesson Learned: Transplant hospitals should pay close attention to the details of their cost allocations.

     

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