For those hospitals and their departments affected by the Centers for Medicare & Medicaid Services (“CMS”) outpatient prospective payment system (“OPPS”) mid-build audits, the saga has been long and convoluted.

In early 2021, CMS and Cahaba Safeguard Administrators (“CSA”) announced that many hospitals had failed the mid-build audit, and would owe significant amounts back to CMS by virtue of the voluntary overpayment return statute. Given most hospitals’ understanding that these mid-build audits were required to be completed by the end of 2018, this two-year delay in completion of the audit was understandably surprising. About six months later, CMS shocked hospitals again by announcing that they would be rescinding the CSA audit results for failing hospitals, and re-evaluating mid-build contracts. Since then, those purportedly failing hospitals have likely received audit results from CMS’s new auditor, Myers and Stauffer LC.

Regardless of auditor, CMS made it abundantly clear that CMS believes the results of the mid-build audits are not subject to administrative or judicial review, by virtue of specific statutory language in the OPPS statute (generally referred to as “jurisdiction stripping”). However, our research indicates that this jurisdiction stripping language, because of the manner in which CMS has attempted to apply it in this instance, undercuts their assertion that the results of the mid-build audit are immune to appeal. Lashly & Baer, P.C. has achieved recent success in overturning the mid-build audit results.

The Health Care Advisory Team at Lashly & Bear, P.C. has the broad base of experienced attorneys to assist health care providers, hospital, and health care systems through the nuances that are going to arise. Our team consists of both regulatory and litigation attorneys that are uniquely qualified to handle these types of matters. If your hospital has been adversely affected by the mid-build audits, please contact your Lashly & Baer, P.C. attorney or attorneys Matthew S. McBride and Richard W. Hill.

Prepared by:

Richard W. Hill
rhill@lashlybaer.com
Phone 314-436-8317

Matthew S. McBride
mmcbride@lashlybaer.com
Phone: 314-436-8324

This summary and legal alert is an overview of the new guidance. It is not intended to be, and should not be construed as, legal advice for a specific factual situation.