This month, the HHS Office of Inspector General (OIG) released a report alleging that 17 of 25 hospitals selected for an audit did not comply, or may not have complied, with the so-called “balance billing requirement” of the Provider Relief Fund (PRF) implemented during the COVID-19 pandemic. The balance billing requirement was a stipulated condition for receiving PRF funding and prohibited charging out-of-network patients more for actual or presumptive COVID-19 diagnosis treatment than if the patient had been in-network. The OIG recommended that HRSA, the agency that administered the PRF program, take action to further review hospital compliance with the balance billing requirement and require hospitals to issue refunds to patients, when applicable. [Break]
The PRF was established in the Coronavirus Aid, Relief, and Economic Security Act (CARES Act, P.L. 116-136) to reimburse, through grants or other mechanisms, eligible health care providers for increased expenses or lost revenue attributable to COVID-19. The CARES Act appropriated to HHS a combined $178 billion in funds, which were, in part, distributed as direct payments to providers in a series of PRF distributions.
As a condition of receiving PRF payments, providers agreed to the PRF terms and conditions. One such condition was that if a patient had insurance and sought treatment for an actual or presumptive case of COVID-19 from an out-of-network hospital, the hospital would not seek to collect out-of-pocket payments greater than what the patient would have otherwise been required to pay if the care had been provided by an in-network hospital—the so-called “balance billing requirement.”
The OIG reviewed a sample of 25 hospitals to determine if those hospitals complied with the balance billing requirement. Of the 25 selected hospitals, the OIG determined that 8 complied with the PRF balance billing requirement, while the remaining 17 did not comply or may not have complied with the balance billing requirement. According to the OIG, the findings of potential noncompliance with the balance billing requirement resulted in improper billing to selected patients of $637,035 during the audit period.
The OIG recommends that HRSA (1) determine whether the selected hospitals made refunds to the patients identified in the audit for billings that did not or may not have complied with the PRF balance billing requirement and (2) as part of its established and ongoing program integrity procedures, perform post-payment reviews of hospitals for compliance with the balance billing requirement, including the hospitals identified that may not have complied, to ensure that patients were not billed more than their in-network amount and were refunded any improperly billed amounts.
In written comments on the draft report, HRSA concurred with both recommendations and described corrective actions it plans to address them, including reviewing the selected hospitals’ compliance with PRF balance billing requirements and requesting that the hospitals make refunds to patients, as appropriate.
The full OIG Report is available here.
