OIG Workplan to Include Accuracy of Place-of-Service Codes on Medicare Part B Claims When Beneficiaries are Inpatients Under Part A
From a reimbursement perspective, the amount Medicare pays physician providers under Part B is based on the location of the service or procedure is provided, such as a physician’s office, hospital or skilled nursing facility (SNF). This payment is designated as a nonfacility rate and a facility rate. The nonfacility rate is reimbursed at a higher rate since the physician will generally have higher practices expenses in his/her own office or independent clinic. When the physician service or procedure is provided in a facility setting, the facility rate will be lower since the facility will incur the overhead and other expenses. These facility charges are reimbursed separately under the appropriate prospective payment system. The two-digit place-of-service code is listed on the physician claim to ensure proper reimbursement to the physician, either at the nonfacility or facility rate.
The Office of Inspector General (OIG) has now included as part of its active work plan accuracy of place-of- services codes on Medicare Part B claims when beneficiaries are Inpatients under Medicare Part A. This addition came as a result of a data analysis of claims from 2018 and 2019, which indicated Medicare may have paid a significant number of Part B claims physician services at the nonfacility rate rather than the facility rate when the beneficiary was a Part A inpatient at a hospital or a SNF.
To review the OIG’s workplan, click here.
