St. Luke's Pays $1M to Settle Medicare Overbilling Claim

The St. Luke’s University Health Network has agreed to pay the United States more than $1 million to resolve allegations that it mistakenly submitted improper Medicare claims over 10 years, the U.S. Attorney’s office in Harrisburg announced Wednesday.

Network hospitals, including St. Luke’s University Hospital in Fountain Hill, allegedly submitted claims for evaluation and management services not allowable under Medicare between January 2002 and June 2012.

The total payment was for $1,029,791.

Medicare does not normally allow payments for patient evaluation or management services “unless the service is significant, separately identifiable, and above and beyond the usual preoperative and postoperative care associated with the procedure,” the U.S. Attorney’s office said.

When such claims are warranted, they may submit an attachment called a “Modifier 25” to the claim. The St. Luke’s network was accused of submitting too many of these “Modifier 25” forms.

“St. Luke’s fully cooperated in this investigation after being contacted by the government,” the U.S. Attorney’s Office said.

In an emailed statement, a hospital spokeswoman said “there has been significant confusion in the hospital industry as to when a Modifier 25 should be used.”

“Estimates indicate that nationally as much as 35% of Modifier 25 submissions may have been incorrectly applied,” the statement continued.

“Hospitals across the country are being audited and requested to refund money received including interest for incorrectly submitting claims with a Modifier 25 for services provided as an outpatient service in a hospital.

“St. Luke’s is working with its billing intermediary to ensure that future submissions are properly coded and supported by clinical documentation.”

The Harrisburg Office of the U.S. Attorney’s Office had jurisdiction because Medicare provider claims are processed by Novitas Solutions Inc., formerly Highmark Medicare Services, in Camp Hill.