Medicare Part B Services During Non-Part A Nursing Home Stays: Mental Health

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This report presents findings based on a medical review of Medicare Part B mental health claims provided during non-Part A nursing home stays in 2006.  Non-Part A stays occur in nursing homes when the stay is not paid for under the Medicare Part A posthospital skilled nursing facility benefit. 

We found that 39 percent of claims for mental health services that Medicare Part B allowed during non-Part A nursing home stays in 2006 did not meet the program requirements for coverage.  Specifically, services were medically unnecessary, undocumented or inadequately documented, or miscoded.  These errors resulted in an estimated $74 million in inappropriate Part B payments, of the $211 million allowed in 2006.  Claims for psychotherapy services comprised the majority of these inappropriately paid claims, which is consistent with findings from the CMS 2006 Comprehensive Error Rate Testing report.  Additionally, we found that 71 percent of the sampled mental health claims contained inaccurate diagnosis codes or lacked adequate documentation to support the diagnosis code, although these codes did not directly affect reimbursement. 

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