Mass. hospital errors could cost state $115M in Medicare funds

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Errors in calculations may lead to Massachusetts hospitals losing $115 million in Medicare funding and 2,000 employees, according to the Boston Globe.

Nantucket Cottage Hospital, a 19-bed facility in Nantucket, Mass., is the state's only rural hospital, meaning it sets the floor for Medicare reimbursements for employee wages under rules which require rural hospitals to be paid as least as much as urban hospitals. The Globe reports this is typically an advantage for the state, due to Nantucket’s high cost of living and difficult to reach location leading to high wages, but accounting errors may hurt the state this year.

Consultants hired by the hospital’s owner, Partners HealthCare, erroneously reported lower wages to Medicare by overestimating hours and failing to include enough physician hours and overtime pay, according to an e-mail from Massachusetts Hospital Association General Counsel Timothy Gens obtained by the Globe.

Partners admits it didn’t notice the consultants’ mistakes when it submitted payment data to CMS in September 2015. It eventually submitted corrected figures April 5, more than two months after the deadline for corrections.

In an effort to convince CMS to use the corrected data, hospitals are asking for assistance from the state’s members of Congress.

“I don’t know how sympathetic they will be,’’ said Rep. Michael Capuano, D-Mass., according to the Globe. “We are trying. I don’t know what the results are going to be.”

Rep. Richard Neal, D-Mass., told the Globe he’s already spoke to CMS Acting Administrator Andy Slavitt about the issue and will soon meet with HHS Secretary Sylvia Burwell.

Without any change, the total Medicare reduction would be $160 million, with the remaining $45 million loss due to a separate audit of Partners’ Nantucket submission. Those findings were appealed before the deadline.

The Globe reported Baystate Medical Center in Springfield, Mass., stands to lose the most in Medicare payment, a total of $25 million, followed by Lahey Health System at $20 million.