A report released last week by HHS' inspector general's office criticizes the existing external review of psychiatric facilities and urges HCFA to beef up its efforts. The 62-page report also urges better coordination among the Joint Commission on the Accreditation of Healthcare Organizations and state and federal surveying agencies; quicker response to complaints and adverse events; and greater accountability from surveyors.
Highlighting the conflicts that surround partial hospitalization services, federal auditors said earlier this month that the Mental Health Corporation of Denver, a community health clinic, didn't meet Medicare requirements on any of a sample of 100 bills for such services in 1996. The clinic billed Medicare for $4.4 million in partial hospitalization services in 1996. It no longer provides the services, saying fiscal intermediaries' guidance on eligibility is confusing. In a separate case, federal auditors said 284-bed Danbury (Conn.) Hospital billed Medicare for $751,000 in unallowable outpatient psychiatric claims and $126,000 in unallowable costs in 1997.
Sen. John McCain (R-Ariz.), chairman of the Senate Committee on Commerce, Science and Transportation, last week asked the General Accounting Office to investigate how states are using money they received from settling lawsuits with the tobacco industry. McCain said he is concerned that states are using some $246 billion over 25 years to fund programs unrelated to smoking, such as highway construction. The states' lawsuits charged that cigarette manufacturers' marketing practices have resulted in increased Medicaid spending.
Medicare payment restraints under the Balanced Budget Act of 1997 have reduced reimbursements to skilled-nursing facilities more than originally intended, according to a report prepared for the American Health Care Association, which represents SNFs. The AHCA is lobbying for SNF payments to be updated at a rate equal to inflation, rather than 1 percentage point below inflation as called for under the balanced-budget law. The report, prepared by the Lewin Group, said the Congressional Budget Office now projects savings of $35.6 billion between 1998 and 2004 under budget-law payment policies, or 80% more than the CBO originally estimated in 1998.
Six people last week were named to the 17-member Medicare Payment Advisory Commission. They are Peter DeBusk, chairman of DeRoyal Industries; Glenn Hackbarth, former deputy HCFA administrator; Alan Nelson, M.D., former executive vice president of the American Society of Internal Medicine; Robert Reischauer, president of the Urban Institute; David Smith, director of the AFL-CIO's public policy department; and Ray Stowers, D.O., director of rural health at Oklahoma State University's osteopathic school.