The Department of Health and Human Services Office of Inspector General (OIG) has just released a report entitled "Potential Improper Medicaid Payments for Outpatient Clinical Diagnostic Laboratory Services for Dual-Eligible Beneficiaries." In the report, the OIG concluded that in fiscal year 2005 and 2006, eight out of eleven selected State Medicaid programs had paid a total of 1.3 million dollars in potentially improper payments for such beneficiaries.

Dual eligibles are beneficiaries who are enrolled in Medicare Part A and/or Part B and also entitled to some Medicaid benefits. According to the OIG, as of January 2006 there were over six million dual eligibles nationwide. In reimbursement procedures for dual eligibles, the services covered by both Medicare and Medicaid are paid first by Medicare. Remaining balances for a service will be covered by Medicaid up to the respective state's payment limit. The OIG says state Medicaid programs should not be paying for any portion of outpatient clinical diagnostic laboratory services that were provided on an assignment-related basis (meaning the Medicare-paid amount is the payment in full) to dual eligibles enrolled in Medicare Part B. However, the OIG found that Medicaid programs in the eight states spent $1.3 million for 104,070 outpatient clinical diagnostic laboratory services provided to dual eligibles on an assignment-related basis.

In the data supporting the report, the OIG selected the ten States with the highest Medicaid payments for all clinical diagnostic laboratory services for dual eligibles: California, Florida, Illinois, Ohio, Mississippi, New Jersey, New York, North Carolina, Tennessee, and Texas; the OIG also included Washington state in the study. The OIG then obtained payment data from the states' Medicaid Management Information Systems (MMIS) on FYs 2005 and 2006 Medicaid payments for dual eligibles for all clinical diagnostic laboratory Current Procedural Terminology (CPT) codes listed in the 2005 and 2006 Medicare fee schedules, resulting in the discovery of the $1.3 million total.
Over half these payments were for five CPT codes: HIV-1 quantification, collection of venous blood by venipuncture, comprehensive metabolic panel, Urinalysis nonautomated with microscopy, and complete, automated, and automated differential white blood cell count.

The report is available online at www.oig.hhs.gov/oei/reports/oei-04-07-00340.pdf

Story based upon the OIG report.

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