November 18, 2005 - The Office of the Inspector General of the U.S. Department of Health and Human Services has released its Work Plan for Fiscal Year 2006 (79-page pdf file).

There are five projects specifically related to dialysis and/or end-stage renal disease:

Payments for Observation Services versus Inpatient Admissions for Dialysis Services - During a recent audit, we noted that hospitals admitted patients for dialysis treatment, which lasted from 24 to 48 hours. Medical reviewers indicated that the stays were for the purpose of observation rather than treatment. CMS Intermediary Manual Part 3, Chapter II, section 3112.8 requires the physician�s order to clearly state the level of care the patient requires; e.g., "admission to inpatient status" or "admission to observation status." Observation services are outpatient services that are paid on an hourly basis and can last up to 48 hours. Inpatient services are paid under a diagnosis-related group (DRG) at a much higher rate. The objective of this audit will be to determine whether payments were made for inpatient admissions for dialysis services when the physicians� orders stated the level of care as admission to observation status.(OAS; W-00-06-35190; A-04-06-00000; expected issue date: FY 2006; new start)

Quality of Care in Dialysis Facilities - We will examine the level of CMS oversight of the ESRD facilities. Previous reports showed that the length of time between the ESRD facility surveys is increasing and that State agencies conduct few complaint investigations due to a lack of resources. We will assess the current level of oversight, especially for facilities showing indications of possible poor quality of care.(OEI; 05-05-00300; expected issue date: FY 2006; new start)

Medicare Reimbursement for End Stage Renal Disease Drugs - We will determine the difference between Medicare reimbursement for selected billable end stage renal disease (ESRD) drugs and the acquisition cost of these drugs to ESRD facilities. The MMA mandates that we conduct a study with respect to drugs furnished to ESRD patients under the Medicare program that are billable by the ESRD facilities. The study will also analyze the growth rate of facilities� expenditures for the ESRD drugs. (OEI; 00-00-00000; expected issue date: FY 2006; new start)

Separately Billable Laboratory Services under the End Stage Renal Disease Program - The MMA requires a report on a bundled prospective payment system (PPS) for ESRD services. This bundled PPS would include certain clinical laboratory tests that are currently separately billable. The current facility payment (composite rate) includes payments for certain automated multi-channel chemistry (AMCC) tests provided routinely at specified frequencies. Any AMCC tests performed in excess of specified frequencies or that are not included in the composite rate payment are billed separately provided that medical necessity is documented. Prior OIG reviews concluded that providers were paid separately for AMCC tests included in the composite rate. To ensure that the bundled PPS rate is based on valid data, we will review providers� current compliance with the current payment policies for AMCC tests furnished to ESRD beneficiaries.(OAS; W-00-06-35202; A-01-06-00000; expected issue date: FY 2006; new start)

Enhanced Managed Care Payments - We will complete several reviews to determine whether CMS made proper enhanced capitation payments to MCOs. Medicare provides enhanced capitation payments for beneficiaries who are institutionalized, in ESRD status, or dually eligible for Medicare and Medicaid. Our reviews are focused on the accuracy of controls at both CMS and the MCOs regarding special status categories warranting these enhanced payments.(OAS; W-00-03-35054; various reviews; expected issue date: FY 2006; work in progress)