Report | March 4, 2015

Delinquent Medical Service Accounts at Naval Medical Center Portsmouth Need Additional Management Oversight

DODIG-2015-087

Objective

Our objective was to determine whether Naval Medical Center Portsmouth (NMCP) properly managed delinquent accounts more than 180 days delinquent (unpaid) by transferring the debt to the appropriate debt collection agency or by actively pursuing collection. This is the third in a series of reports concerning delinquent medical service accounts (MSAs). This report provides the results of our review performed at NMCP. We reviewed the 25 highest-dollar delinquent MSAs valued at $458,325.

Finding

NMCP Uniform Business Office (UBO) management did not effectively manage delinquent MSAs. As of July 15, 2014, NMCP UBO had 1,533 outstanding MSAs, valued at $817,399. The accounts were more than 180 days delinquent but had not been transferred to the U.S. Treasury. NMCP UBO management did not transfer 22 of 25 accounts, valued at $370,953, to the U.S. Treasury for collection after the account was delinquent for 180 days. Further, NMCP UBO management did not actively pursue collection for 19 of the 25 delinquent MSAs, valued at $343,857. This occurred because, among other reasons, NMCP management did not have a system in place to monitor and notify staff of MSAs needing follow up, and did not comply with guidance requiring collection of complete and accurate patient information. As a result, NMCP UBO management missed opportunities to collect $770,746 in delinquent payments that could have been used for other valid needs. Unless NMCP UBO management improves collection efforts and takes prompt actions to collect the delinquent debt from the MSAs we reviewed and 1,508 other delinquent MSAs, NMCP UBO will continue to incur rising delinquent balances for future MSAs. NMCP UBO took corrective actions such as transferring claims to the U.S. Treasury and requesting status updates on claims awaiting Department of Veterans Affairs action.

Recommendations

We recommend the Commander, NMCP, validate that the planned medical billing system will prioritize delinquent medical service accounts and alert the clerks as to which accounts require follow-up or establish procedures to fully utilize the Centralized Receivable Service offered by the U.S. Treasury.

We also recommend the Surgeon General, U.S. Navy Bureau of Medicine and Surgery, coordinate with the Assistant Secretary of Defense (Health Affairs), to discuss the reimbursement issues arising from Medicare and Department of Veterans Affairs (VA) claims, and assess whether further action can be taken.

Finally, we recommend the Assistant Secretary of Defense (Health Affairs) meet with the Department of Health and Human Services and VA to discuss difficulties NMCP has encountered with receiving reimbursement for services provided to Medicare and VA beneficiaries and identify a way forward to improve collections.

Management Comments and Our Response

Comments from the Assistant Secretary of Defense (Health Affairs) addressed the specifics of the recommendation. However, the Surgeon General, U.S. Navy Bureau of Medicine and Surgery; and Commander, NMCP, did not provide comments on the report, therefore, we request comments in response to this report by April 3, 2015.