IU Health will refund $280,000 to Medicare

Indiana University Health will refund the federal Medicare program $280,000 after an audit of almost 200 claims made by its downtown hospitals found nearly 18 percent of them had been billed improperly.

The audit, conducted by the Inspector General’s Office in the U.S. Department of Health and Human Services, found that IU Health staff sometimes failed to report manufacturer credits they had received for replacing medical devices, or had coded some claims for a higher level of severity than was actually the case, or in three cases, billed for more procedures than were actually performed.

IU Health overbilled about 2 percent of the $11.6 million that it billed for the 198 claims examined by the audit, which focused only on areas in which hospitals are most likely to make errors. The claims examined were submitted to Medicare between October 2008 and September 2010.

During the period, IU Health’s downtown hospitals received total Medicare payments of $590 million.

Kimberly Carter, IU Health’s revenue cycle system manager, said the hospital system would refund the $280,000.

“IUH has strengthened its internal controls to prevent future billing errors,” Carter wrote in response to the inspector general’s report. “In addition to the extensive coding quality checks that are currently in place, IUH will continue to perform targeted reviews on cases prone to coding errors which can lead to inappropriate payments.”

IU Health’s downtown hospitals are Methodist Hospital, University Hospital and Riley Hospital for Children.