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OIG Identifies Inpatient Rehabilitation Facility (IRF) Overpayments

The Office of Inspector General (“OIG”) today published a report regarding overpayments identified made to inpatient rehabilitation facilities (“IRFs”) from 2004 through 2007. According to the report, of the claims reviewed by the OIG, the vast majority (i.e., 213 out of 220) of transfers from an IRF to another facility were improperly coded as discharges. The reimbursement to an IRF that discharges a patient surpasses the reimbursement to an IRF if it transfers a patient to another facility. Accordingly, the OIG predicted that if its findings were extrapolated to non-reviewed claims, it is possible the Centers for Medicare and Medicaid Services (“CMS”) made $34 million in overpayments with respect to this issue. The OIG recommended that CMS review all claims in the sample frame and recover any overpaid amounts.

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