Inpatient Rehabilitation Facilities Drain Medicare Dollars By Upcoding Transferred Patients As Discharged Patients

Inpatient rehabilitation facilities receive higher Medicare reimbursement payments when patients are discharged, than when the patients are transferred to other facilities. However, according to a recent HHS-OIG report, some facilities have a “difficult time” distinguishing between discharged and transferred patients.

In this audit, HHS-OIG reviewed the records of 41 inpatient rehabilitation facility patients who were supposedly discharged from the hospital. Remarkably, 26 of the 41 patients were actually transferred to another facility. In turn, the Medicare system overpaid an astounding 63% of the time. With an additional price tag of $6,200/patient, these overpayments drained well over $100,000 from the Medicare Trust Fund. If the facilities knowingly submitted these upcoded claims, they could be held liable under the federal False Claims Act.

These results provide a glimpse into a pervasive world of Medicare fraud. Inpatient rehab facilities regularly miscode transferred patients, with the hopes of inflating their bottomlines.

For more information about qui tam law and Medicare fraud, contact Nolan and Auerbach, P.A.