Hospitals wrongly claim EHR cash

'A review would have shown that the incorrect cost report periods were used'
By Erin McCann
10:54 AM
Money and stethoscope
In the wake of meaningful use, many hospitals in recent years have been found to have wrongly claimed electronic health record incentive payments. The Louisiana Department of Health and Human Services is the latest entity to face criticism over its handling of EHR payments after it was found to have overpaid hospitals $3.1 million in federal cash. 
Louisiana's Medicaid EHR payments to hospitals missed the mark in several areas, according to a recent audit released by the Office of Inspector General. The report, which examined the state's payouts in 2011, found that LDHHS overpaid 13 hospitals $3.1 million and underpaid six hospitals $1.3 million. Overall, some 80 percent of Louisiana hospitals analyzed in the audit failed to comply with federal regulations or guidance. 
The payment errors transpired due to an unclear and incorrect patient volume calculation, OIG officials pointed out, leading some hospitals to miscalculate the numbers. 
Moreover, a discharge-related calculation worksheet for hospitals also contained a formula error that went unfixed by the state agency. This, together with myriad clerical errors left unreviewed contributed to the incorrect payments being sent.
"A review would have shown that the incorrect cost report periods were used, and the supporting documentation would have shown when hospitals included inpatient nonacute-care services," wrote Gloria L. Jarmon, deputy inspector general for audit services at OIG, in the August report. "State agency personnel did not use the correct cost report periods or review supporting documentation for the numbers provided in the cost reports that were used to calculate incentive payments."
Overall, LDHHS paid out $93.4 million for Medicaid EHR incentive payments in 2011. As of July 2014, the Centers for Medicare and Medicaid Services has paid out nearly $25 billion in EHR payments to eligible providers and hospitals. 
What transpired at Louisiana Department of Health and Human Services was not the first incident involving the overpayment of federal EHR money. 
Just last year, Florida-based hospital operator Health Management Associates, which was acquired early 2014 by Community Health Systems, wrongly claimed a whopping $31 million in EHR payments. 
Following an internal review, officials found that 11 of 71 hospitals the company operated did not actually meet meaningful use criteria, despite being awarded payments. 
In another case earlier this year, the former chief financial officer of Shelby Regional Medical Center in Texas, was indicted for wrongly claiming nearly $1 million in federal EHR payments. 
According to officials, the hospital relied on paper records throughout the fiscal year and only minimally used an EHR. To give the appearance that the hospital was using MU-certified technology, its former Chief Financial Officer Joe White directed its software vendor and hospital employees to manually input data from paper records into the electronic health record software – often months after the patient was discharged and after the end of the fiscal year.