CMS may suspend payments to a Medicare provider or supplier for any of three circumstances: 1) fraud or willful misrepresentation, 2) when an overpayment exists but the amount has not been determined, or 3) when payments made or pending may be incorrect. CMS also may suspend payments based on requests from its contractors or from law enforcement, the OIG noted.

 

The OIG reported that it analyzed 253 suspensions CMS imposed in 2007 and 2008. Part B providers composed 85 percent of those suspensions. Overpayments to providers in those years totaled at least $206 million.

 

According to the OIG, 74 percent of suspended providers showed questionable billing patterns. Sixty-three percent of suspensions were supported by information from beneficiaries or from other providers; this information included evidence that the suspended providers had billed for services that never were received or were medically unnecessary and had used other providers’ billing numbers to seek payment for items or services that had not been authorized.

 

Twenty-four percent of suspended providers billed Medicare before their suspensions despite having vacant physical locations.

 

The OIG noted that payment suspensions were used in 2007 and 2008 almost exclusively as a tool to fight fraud. Recognizing that the Patient Protection and Affordable Care Act was signed into law, the OIG reminded that the law states that a provider’s payments may be suspended based on a credible allegation of fraud unless there is good cause not to suspend such payments.

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