Medicare Overpaid Hospitals $26 Million for IMRT

Roxanne Nelson, BSN, RN

August 23, 2018

Medicare may have overpaid hospitals nearly $26 million for outpatient intensity-modulated radiation therapy (IMRT) planning services, according to an audit conducted by the Office of Inspector General (OIG) at the US Department of Health and Human Services.

The audit found that hospitals received $25.8 million in payments for IMRT planning that failed to comply with standard Medicare billing. For all of the 100 line items in the sample that the auditors used, hospitals billed separately for "complex simulations" that were performed as part of IMRT planning. These overpayments occurred primarily because the hospitals either appeared to be unfamiliar with or misinterpreted the Centers for Medicare & Medicaid Services (CMS) guidance, according to the OIG.

The claim-processing edits did not prevent overpayment, because the edits applied only to the services that were billed on the same date of service as the billing of the procedure code for the bundled payment, but the services in the audit sample were billed on different dates.

Overall, the auditors estimate that hospitals were overpaid as much as $21.5 million for complex simulations that were billed during calendar years 2013 through 2015. An additional $4.2 million in potential overpayments was also identified for other IMRT planning services that were not included in the sample. In total, Medicare is believed to have overpaid hospitals as much as $25.8 million during this audit period.

How Billing Works

IMRT is provided in two treatment phases that are designated as planning and delivery. The planning phase is a multistep process in which imaging, calculations, and simulations are performed to develop an IMRT treatment plan (IMRT planning). During the delivery phase, radiation is delivered to a treatment site (ie, a tumor) at the various intensity levels prescribed in the IMRT treatment plan.

Facilities must use current procedural terminology (CPT) code 77301 to bill for IMRT planning. These services may not be billed separately if they are performed as part of the development of an IMRT treatment plan. This holds true whether or not they are billed on the same or a different date of service. This is specific to IMRT and includes other common radiology procedures.

CMS developed the National Correct Coding Initiative (NCCI) to help providers bill correctly and to prevent Medicare payments from being improperly coded. Medicare contractors implemented NCCI edits within their claim processing systems in 1996. The NCCI edits include procedure-to-procedure edits that define pairs of HCPCS and CPT codes that generally should not be reported together for the same Medicare recipient on the same date of service. These automated prepayment edits apply to IMRT planning services and usually will prevent improper payments when any of the individual planning services are billed on the same date of service as CPT code 77301.

But as the auditors note, these will not prevent overpayments from being made if the services are billed on different days.

During the audit period, Medicare paid 1193 hospitals $109,197,933 in bundled payments for IMRT planning CPT code 77301 and up to $25,754,171 in potential overpayments for billing outpatient IMRT planning services separately.


The OIG recommends the following:

  • That CMS implement an edit to prevent improper payments for IMRT planning services that are billed before (eg, up to 14 days before) IMRT planning CPT code 77301 is billed; this action might have saved as much as $25,754,171 during this audit period and as much as $5,412,297 in the 2 years following the audit.

  • That CMS work with the Medicare contractors to educate hospitals on how to bill properly for IMRT planning services.


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