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Heritage matter, Group busted for billing Admin fee

February 14, 2013

You may have heard about the Heritage matter by reading the Health Business Daily article (available here) or from another source.  If not, basically what happened was a South Carolina medical group (Heritage) paid over $170k to the Office of Inspector General to settle because the Office of Inspector General went after Heritage for charging Medicare patients a $50 annual "administrative" charge to pay for admin time spent doing paperwork on behalf of the patient.  In response to this large settlement I have received questions from numerous sources requesting an opinion on the happenings and whether an "admin" fee is in fact asking for trouble.  My response is, I have not seen the actual charges against Heritage, but solely based off of the Health Business Daily article, the facts asserted therein indicate Heritage was charging Medicare patients a fee for administrative work that was actually included in the Medicare beneficiary's allotted fee for services. In fact, this matter is listed on OIG's website under "Overcharging Beneficiaries", see here.  

As pointed out in the Health Business Daily there is a fine line between offering a value-add service for an additional fee versus charging beneficiaries for a service that is included to them by right of qualifying for government reimbursement for services.  Meaning, this determination does not change whether a practitioner may charge for "admin" services, but it does highlight that those looking to supplement Medicare income certainly cannot do so by charging Medicare beneficiaries additional out of pocket expenses for already covered services.    If you have an "admin" fee you would like to discuss or review, or you are thinking of developing same for your practice, be sure to speak with your healthcare attorney to ensure proper development, implementation and compliance. Need help? Call or email me.


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