A new report by the Office of Inspector (OIG) finds that providers improperly charged Medicare approximately $580 million for psychotherapy services during the first year of the COVID-19 pandemic.
The report found that Medicare paid $1 billion for psychotherapy between March 2020 through February 2021 for psychotherapy services, including telehealth services. More than half of those charges didn’t comply with Medicare requirements, including $348 million for telehealth services and $232 million for non-telehealth services.
Prior OIG audits of four psychotherapy providers identified high improper payment rates for psychotherapy services furnished before the public health emergency. OIG conducted the latest nationwide audit to determine whether compliance issues identified in the prior audits occurred during the first year of the pandemic. As part of the audit, the OIG surveyed providers on their experience with providing those services to Medicare enrollees.
The audit looked at Part B payments for more than 13.5 million psychotherapy services. Analysts selected two stratified random samples of psychotherapy services: one sample consisted of 111 enrollee days for telehealth services and the other consisted of 105 enrollee days for services provided in person.
The OIG found that providers didn’t meet Medicare billing requirements, such as not documenting psychotherapy time, for 128 of the 216 sampled enrollee days. In addition, 54 sampled enrollee days did not meet Medicare guidance (such as providers’ signatures were missing).
Based on the sample results, the OIG estimated that providers received $580 million in improper payments for services that did not comply with Medicare requirements.
OIG recommends that the Centers for Medicare & Medicaid Services (CMS) work with contractors to recover $35,560 in improper payments for the sampled enrollee days; implement system edits for psychotherapy services to prevent payments for incorrectly billed services; and strengthen educational efforts to make providers aware of educational materials on meeting requirements and guidance for psychotherapy services. Click here to read the complete report, including the CMS response and action plan.