OIG Won't Prosecute Outpatient PPS Errors - Brief Article

Healthcare Financial Management, August, 2000

The HHS Office of Inspector General (CIG) recognizes that providers will face challenges in implementing the new hospital outpatient prospective payment system (PPS), HHS Inspector General June Gibbs Brown said in a June 23 letter to the American Hospital Association (AHA). Brown reiterated her office's position that the OIG does not subject providers "to civil or criminal penalties for innocent errors, mistakes, or even negligence." The letter was prompted by concerns of AHA members that given the complexity of the new PPS, coding and billing errors would almost certainly occur. The AHA therefore had requested "a statement of enforcement policy" regarding compliance with the new system.

Brown noted that should questions of improper billing under the hospital outpatient PPS arise, the QIG would consider a variety of factors to determine whether a penalty should be imposed. She offered six examples of factors that would be considered:

* The clarity of the relevant rule;

* The complexity and novelty of the billing system;

* The guidance issued by HCFA and/or its agents (eg, fiscal intermediaries);

* The extent to which the provider has attempted to ascertain an understanding of the relevant rule;

* The quality of the efforts of the provider to train personnel on the billing system; and

* Whether the provider has an effective compliance program in place.

In essence, the QIG expressed a sensitivity to the possibility that "innocent errors" are likely to occur as the industry grapples with outpatient PPS implementation. However, the QIG stopped short of creating any specific amnesty program to cover outpatient PPS implementation and, instead, will depend largely on existing policies, including shielding providers from penalties for inadvertent errors, to guide its enforcement efforts.