The Recovery Audit Contractor (RAC) program that concluded in March identified $371 million in improper payments during FY2007. Among inpatient hospitals, six service areas accounted for $117.2 in overpayments.

These areas, the amount of overpayments, and the total number of claims audited, include:
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MassHealth, the Massachusetts Medicaid Program, has announced that it will no longer reimburse providers for 28 preventable medical conditions. In addition, the commonwealth’s largest private health insurer, Blue Cross and Blue Shield of Massachusetts, announced that it will also adopt a policy of not paying for the 28 preventable conditions.

The list of 28 preventable conditions is the most extensive and specific list of “never events” adopted by a state or federal agency to date. Details about the policy’s implementation and how it will be enforced have yet to be announced, according a Boston Globe article. The complete list of the 28 “never events” include:
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New York State's Medicaid policy to no longer pay for 14 specific hospital-caused conditions is being met with applause by many provider organizations, according to a Modern Healthcare Article.

"New York's approach is noteworthy and has been met with approval by hospitals because they prefer a list of 'never events' instead of the more complex hospital-acquired conditions that constitute Medicare's nonreimbursement policy," the article stated.
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The Medical Group Management Association (MGMA) would be “extremely concerned” if CMS extended its non-payment strategy for preventable conditions to physician practices. This is according to a letter that the association submitted to CMS during the comment period for the FY2009 Inpatient Prospective Payment System proposed rule that was published in April. In addition, MGMA also used the comment letter to “raise concerns regarding any rapid timeline for adopting the ICD-10 code sets.”

Within its proposed rule, CMS requested comments from the industry on both of these issues. The last day to submit comments to CMS on the proposed rule was Friday, June 13.
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CMS has discovered and corrected an error that the agency found in its Inpatient Prospective Payment System (IPPS) proposed rule that was published in April. CMS posted a corrected version of the proposed rule on its Web site June 10.

The error was discovered in the calculation of the out-migration adjustment and in the related Table 4J. As a result, some providers will no longer qualify for an out-migration adjustment for the FY2009 proposed wage index. Conversely, other providers will now qualify for the adjustment.
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