The Office of the Inspector General (OIG) has issued a report regarding the findings of a review they conducted on outpatient physical therapy services provided to Medicare beneficiaries between July 1 – December 31, 2013. For calendar year (CY) 2013, the Medicare Part B program paid approximately $1.8 billion for outpatient physical therapy services provided to beneficiaries.
The OIG sampling frame consisted of 9,037,556 outpatient physical therapy service claims with a place of service code of 11 (signifying that the therapist provided the service in an office setting), totaling $635,771,872, of which we reviewed a stratified random sample of 300 claims. A claim consisted of all services provided to a beneficiary on the same date.
Sixty-one percent of Medicare claims for outpatient physical therapy services that the OIG reviewed did not comply with one or more of the following requirements: Medicare medical necessity, coding, or documentation. Specifically, of the 300 claims in our stratified random sample, therapists claimed $12,741 in Medicare reimbursement on 184 claims that did not comply with Medicare requirements. Therapists properly claimed Medicare reimbursement for the remaining 116 claims.
On the basis of the sample results, the OIG estimated that Medicare paid $367,039,705 for outpatient physical therapy services that did not comply with Medicare requirements during the 6-month audit period. Therapists submitted claims that were not medically necessary, contained coding deficiencies, or did not meet Medicare documentation requirements.
The OIG determined 91 claims did not support medical necessity, 145 claims had coding errors and 112 claims did not meet Medicare documentation requirements. Types of medical necessity errors included:
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