HHS Office of Inspector General (OIG) has released a new analysis of claims paid under the COVID-19 Uninsured Program. OIG reportedly identified a few dozen instances where the program reimbursed healthcare providers for services provided to patients who ended up having health insurance coverage. OIG generally assigned responsibility for these payments to the private contractor who administered the program, but nonetheless encouraged audits and recovery from the healthcare providers who received payments.
The COVID-19 Uninsured Program was created in early 2020 in response to provide reimbursement for providers who treated uninsured patients for COVID-19. The program was part of the larger Provider Relief Fund and paid claims up until April 2022, when it ran out of money. Altogether the Program paid out approximately $24.5 billion in claims. The program was overseen by the Health Resources and Services Administration (HRSA), but the day-to-day administration and claims processing functions were contracted to Optum Pay, a subsidiary of Optum Bank.
According to OIG (which did not refer to Optum Pay by name in its report, referring only to “HRSA’s contractor”), the contractor processing claims under the program indicated that it would check the insurance status of patients for whom claims were submitted, but in fact only checked insurance status when the patient’s Social Security Number (SSN) was included on the claim. HRSA did not require SSNs on such claims and so the majority of claims did not include SSNs and were not screened by the contractor prior to payment. Instead, HRSA’s contractor relied on the attestation by providers that the patient did not have health insurance coverage.
OIG reviewed a sample of 300 claims paid under the program. OIG asserted that 58 of the 300 claims it reviewed were improperly paid. 38 claims were improperly paid because the patient had health insurance coverage, 29 claims because the contractor did not check for coverage, and 9 claims because the contractor checked but incorrectly determined that the patient did not have coverage. OIG asserted that 22 of 58 claims (including some overlap) were improperly paid because it determined that the service was either not provided or was not sufficiently related to COVID-19.
Based on its review, OIG asserted that approximately $784 million in payments under the program were improper. Despite identifying a significant flaw in the administration of the program by HRSA and its contractor, OIG nevertheless recommended that HRSA audit and seek recovery from healthcare providers. Providers who receive audit notices or overpayment demands from HRSA should familiarize themselves with the mechanics of the program. Although providers were required under the program to verify and attest that a patient did not have health insurance, those providers who took appropriate measures but who are still assessed an overpayment based on errors by HRSA for its contractor may have additional defenses available to them.
For over 35 years, Wachler & Associates has represented healthcare providers and suppliers nationwide in a variety of health law matters, and our attorneys can assist providers and suppliers in understanding new developments in healthcare law and regulation. If you or your healthcare entity has any questions pertaining to the COVID-19 Uninsured Program or healthcare compliance, please contact an experienced healthcare attorney at 248-544-0888 or firstname.lastname@example.org.