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Bartlett acknowledges billing errors

Hospital improperly billed $956K to Medicare, Medicaid

Posted: November 28, 2012 - 12:01am
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Bob Storer, president of Bartlett Regional Hospital's board of directors, leads a Tuesday night board meeting to discuss billing issues dating back to 2006 that will cost the hospital almost $1 million in repayments to the federal government. Bartlett's Chief Executive Officer Christine Harff is in the background.  Michael Penn / Juneau Empire
Michael Penn / Juneau Empire
Bob Storer, president of Bartlett Regional Hospital's board of directors, leads a Tuesday night board meeting to discuss billing issues dating back to 2006 that will cost the hospital almost $1 million in repayments to the federal government. Bartlett's Chief Executive Officer Christine Harff is in the background.

Bartlett Regional Hospital disclosed errors in billing to Medicare and Medicaid worth more than $956,000, stretching back as far as 2006, ahead of the regular meeting of its board of directors Tuesday evening.

In a letter to the board that was entered into the public record as part of the agenda packet for Tuesday’s meeting, Hospital Attorney Dick Monkman wrote that the errors were first discovered and corrected in April, and that an investigation and audit by the law firm Sonosky, Chambers, Sachse, Miller and Munson, LLP and the hospital’s accounting firm “did not find any indication of intent to defraud, nor … any misappropriation of funds.”

“We just basically misinterpreted what we were allowed to do,” Community Relations Director Jim Strader said Tuesday night.

“The total of the amount that’s been found through the audit is the amount that was in Mr. Monkman’s letter (is) $956,443,” Ken Brough, Bartlett’s chief financial officer, said. “So the government’s proposed multiplier would be 1.5 times that, which brings us to the $1.4 million approximate figure that we’re negotiating with them to try and settle the problem.”

The board of directors addressed the issue at Tuesday’s meeting, first behind closed doors in executive session and then again in public. Monkman was present to discuss the findings.

“Overall, it’s a very small percentage of your Medicare and Medicaid revenue, somewhere under 1 percent of the total volume of payments,” said Monkman, after the public portion of the meeting resumed. “But the bills, however, were erroneous, and whenever you submit an erroneous bill to the federal government, they ask to have it turned back.”

Monkman praised the response by Bartlett staff, as well as its former interim administrators. The hospital was led at the time of the errors’ discovery by Chief Executive Officer John Vowell and CFO Dennis Stillman, who took over early this year after its management contract with Brentwood, Tenn.-based firm Quorum Health Resources expired.

The errors were reported to the Office of the Inspector General as a “self-disclosure,” Monkman said.

In response to a question from Dr. Alex Malter, Monkman confirmed that all of the services billed were indeed provided to patients by licensed hospital physicians.

Monkman added, “The bills that went in were incorrect in the way they were formatted.”

Linda Thomas asked whether patients were overcharged as a result of the improper billing, to which Monkman responded in the negative.

“This was entirely Medicare and Medicaid, so it’s just bills that went to the federal government for those programs,” said Monkman.

CEO Chris Harff and board President Bob Storer agreed that the administration and board should work to encourage staff to continue to report issues like the improper billing to the board.

“The one thing I’ve learned — because I’ve been working on this, privy to this as we progressed — the billing is so complex, mistakes will happen. That’s a given,” Storer said. “So what we need to do, what I’m hearing, is create the environment to catch the errors as quickly as possible.”

Responding to a question by Nancy Davis as to whether she believes Bartlett has fixed the problem, Harff said the hospital is making an effort to verify how rules and regulations are interpreted.

“I think we relied on one person’s interpretation of the regulations, so we’re not doing that,” Harff said. She added, “We want to get away from having one person be the guru for all interpretation. We get a couple of opinions, look at how others are doing it.”

Brough said that while the findings would impact Bartlett’s financial situation, it has enough money in its reserves that it will be able to repay the state and federal government.

“Fortunately, you have the reserves in place. We won’t have to jeopardize care,” said Brough. “The funds are there. There’s hospitals in this situation that have no funds to pay this and have to enter into a repayment plan. … Fortunately, we have the funds to resolve this matter promptly and dispose of it, leave it behind us.”

According to Monkman’s letter, the errors stemmed from practices not allowed under federal law. Strader described what happened during a break in the meeting Tuesday night.

“There’s a physicians’ group involved in the billing, and they provide services in the emergency room. And the bills were apparently modified to all go under one person’s name, because the rest of the doctors in their particular group … were not in enrolled in Medicare,” Strader explained. “It was a misinterpretation of the rules on the part of the patient financial services director at that time … that that was an acceptable practice, because that doctor was the head of the group.”

Bartlett hired a new patient financial services director, Bobbi Scherrer, last October.

Scherrer could not be reached for comment Tuesday.

• Contact reporter Mark D. Miller at 523-2279 or at mark.d.miller@juneauempire.com.

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