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Fraud doesn’t stop with the Departments of Justice and Health and Human Services arrests of more than 100 people charged in connection with more than $450 million in fraud as reported last Thursday in the RACMonitorEnews.


Psychiatric Solutions Inc. and Universal Health Services Inc. will pay $3.45 million to settle allegations brought by a whistleblower that a subsidiary inappropriately billed under Medicare’s partial-hospitalization program, according to the U.S. Attorney’s office in eastern California.


Subsidiary BHC Sierra Vista Hospital Inc. did not provide the “number of services to certain patients require to qualify for per-diem payment” as part of the partial-hospitalization program, an intensive outpatient program, the U.S. Attorney stated. The hospital also failed to obtain approval of certain outpatient treatment, document therapy sessions, obtain physician orders for lab work and obtain physician certifications for certain admissions.


The hospital also entered into a five-year corporate integrity agreement with the Office of Inspector General (OIG), the U.S. Attorney stated.


In other fraud news, in Tennessee, three people were arrested in relation to charges of defrauding the state’s Medicaid program, according to press releases from the state: One woman, charged for the third time with TennCare fraud, allegedly used fraudulent means to obtain Oxycodone. A man, charged for the second time with TennCare fraud, allegedly obtained Morphine Sulphate through a prescription then sold it to an undercover police officer. Another woman was charged with fraudulently obtaining TennCare benefits then selling portions of Hydrocodone and Oxycodone prescriptions.


RAC Releases One Issue


Region B recovery auditor (RAC) CGI recently posted one inpatient hospital issue about minor musculoskeletal procedures.


Inpatient hospital


Name of issue

Date posted or approved

Regions/states where it is active

Description of issue

Document sources

Minor musculoskeletal procedures with CC/MCC (MS-DRG 477, 478, 500, 501, 515, 516)


RAC Region B

The purpose of this complex review is to identify claims that have been reviewed validating medical necessity in short stay, uncomplicated admissions. This review will identify whether medical necessity was met per Medicare guidelines.

Medicare Benefit Policy Manual chapters 1, 6, 10; Medicare Claims Processing Manual chapter 4; Medicare Program Integrity Manual chapters 6, 13; OIG reports A-03-00-00007, OAI-05-88-00730, A-01-10-01000; 2009 Report to Congress on the Evaluation of the Quality Improvement Organization Program (fiscal year 2006); Pepper report; WPS LCD DL32222; Highmark LCD L27548; Section 1886(d) of the Social Security Act


About the Author


Karen Long is the compliance product manager for DecisionHealth and oversees products that relate to fraud and abuse and HIPAA compliance for physician offices and home health agencies, and accreditation compliance for hospitals. In her almost four years at DecisionHealth, Karen also has been the compliance editor and a reporter for Home Health Line, nation’s leading independent authority on home healthcare business, regulation and reimbursement.


Contact the Author




To comment on this article please go to editor@racmonitor.com


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