Transplant Fraud

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Extensive federal and state laws regulate organ and tissue donation and transplantation. These many regulations were promulgated to address a variety of issues, including the medical, legal, and moral issues involved in organ donation and transplantation. One of the main issues deals with the enormous demand for human organs in a context where there is an inadequate supply of usable organs. These laws are generally viewed by lawmakers, members of the medical professions, and by the populace as a way to ensure the most equitable distribution of organs.

Organ Acquisition Cost Centers (OACC) were developed by HHS to facilitate billing and to defray evaluative services conducted in Clinics for prospective living transplant donors and/or recipients. While Part A and B costs related to the final transplantation surgery and medical follow up had been covered under separate prospective payment arrangements, the Clinic evaluative overhead costs were not previously reimbursable at a level which captured the full expenses incurred.

Transplantation is the most complex of cost reports, since there are three components: physician services (evaluative, medical care, and surgical care), hospital services related to the transplant procedure and any related complications, and organ acquisition costs (OACs). OACs are complex, subject to some variability in interpretation, are defined by specific regulations, and are auditable by the Office of Inspector General. OACs include 1) Final organ procurement costs, including surgery and 2) Organ Acquisition Cost Center (OACC) pre-operative costs, to include: Costs of maintaining waiting lists; all costs of evaluating prospective donors and recipients at a site, including immunological testing; physician services pursuant to these services, not classifiable as direct medical care; salaries and benefits of all ancillary nursing, social work, and technical staff; indirect facility costs, including rent, computers, and supplies.

Whistleblower exposure of Medicare Fraud in transplant centers include the following:

  • Mis-allocation of staff salaries and employee benefits, claimed specifically for pre-operative services (rather than global transplant services)
  • Billing for physician pre-operative services that are otherwise reimbursable under Part A or B. (Physician payments under OACC are limited to services not directly related to identifiable medical care, i.e., only administrative duties in the transplant evaluation center.
  • Mis-allocation of direct and indirect facility costs which are billed under OACC, including space utilization justifications with time studies and overhead costs.

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