ROANOKE TIMES
Copyright (c) 1997, Roanoke Times
DATE: Saturday, March 29, 1997 TAG: 9703310057
SECTION: NATIONAL/INTERNATIONAL PAGE: A-1 EDITION: METRO
DATELINE: WASHINGTON
SOURCE: PAUL HELDMAN BLOOMBERG NEWS
STAFF WRITER SANDRA BROWN KELLY CONTRIBUTED INFORMATION TO THIS STORY.
The federal investigation of Columbia/HCA does not include its Virginia hospitals.
The federal government is trying to determine whether the nation's largest for-profit hospital company - Columbia/HCA Healthcare Corp. - has been overbilling for care of Medicare patients.
The review is being conducted to see whether the Nashville, Tenn.-based chain uses a practice called upcoding, in which a hospital overstates the severity of a patient's medical condition to increase its reimbursement from the health insurance program for the elderly.
Bruce Vladeck, chief Medicare administrator, said Friday that the review involves Columbia/HCA hospitals in Kentucky and two or three other states. He would not name the other states, but The New York Times reported Friday that hospitals in Florida, Texas, Illinois and Nevada are being investigated by the FBI.
Columbia hospitals in Virginia are not part of the inquiry, a spokeswoman for Columbia Lewis-Gale Medical Center in Salem said. Columbia also owns Montgomery Regional and Pulaski County hospitals in the New River Valley and Alleghany Regional Hospital in Low Moor.
Vladeck said the Clinton administration is still trying to determine whether Columbia/HCA has broken the law.
``If we think it is just pushing the edges of what is appropriate, we'll get our money back,'' Vladeck said. ``If there has been some false claims, we will refer it'' to federal investigators in the Inspector General's office of the U.S. Department of Health and Human Services.
Medicare pays hospitals a flat sum based on the diagnosis of the patient being treated. The system is designed to provide an incentive for hospitals to provide the most efficient care possible, because they keep whatever money is not used to care for the patient.
The payment rates vary based on a patient's condition and diagnosis, giving hospitals incentive to stretch the truth about the severity of a patient's illness.
Vladeck said hospitals are given a certain amount of leeway on diagnosis and billing. ``There is certain amount of legitimate effort to code for highest reimbursement permissible for a specific kind of case,'' he said.
With Columbia/HCA, ``The question is whether they've been doing it to a degree that is inconsistent with that of other hospitals'' and whether it ``crosses the boundary toward behavior in which you want to take some action.''
Columbia/HCA has $20 billion in annual revenue. It owns more than 340 hospitals and 140 surgery centers and has 550 home health agencies in 37 states.
Last week, federal investigators raided Columbia/HCA's four El Paso, Texas, hospitals and more than 20 physicians' offices, seizing boxes of documents.
Investigators have been unwilling to comment on that investigation. The government has been under pressure from Congress to examine whether any hospitals are paying doctors to refer patients to fill their beds.
Rep. Fortney ``Pete'' Stark of California, the top Democrat on the House panel that oversees Medicare, is a major critic of Columbia/HCA and has been pushing Vladeck to investigate whether the hospital chain has violated laws that restrict physician referrals to services in which they have a financial stake.
In addition to its hospital services, Columbia/HCA also provides long-term care such as home health care. The Times quoted Vladeck as saying referrals by Columbia doctors could raise a red flag.
The review of Columbia/HCA billing practices is being done by Peer Review Organizations, local groups under contract with the government to monitor the quality of care provided to the nation's 38 million Medicare beneficiaries. Their responsibilities include periodic review of Medicare billing by hospitals.
Vladeck said the review has intensified as a result of a yearlong investigation by The New York Times into Columbia/HCA's billing practices.
The Times said it examined 30 million billing records, concluding in a story published in Friday's paper that Columbia bills for high-paying respiratory treatments far more often than do competing hospitals serving similar populations.
Columbia/HCA officials have not commented on the investigations.
LENGTH: Medium: 83 linesby CNB