OIG: Medicare is Overpaying for Enteral Nutrients in Nursing Homes

According to a new report from the Office of the Inspector General (OIG), Medicare's fee schedule for enteral nutrients under Medicare Part B was more than double the prices available to nursing home suppliers in 2006.

Researchers found that Medicare Part B paid $284 million in 2006 for enteral nutrition therapy (ENT) to nursing homes for non-Part A stays. For example, the average price paid for B4150 nutrients was 67 cents per unit, compared to costing 32 cents for suppliers. B4154 nutrients were priced at $1.22 per unit under the Medicare schedule and cost 56 cents for suppliers.

The OIG is recommending the following as two potential fixes for the problem:

1. Have CMS adjust the Medicare fee schedule amounts for enteral nutrients in order to more accurately reflect supplier prices for nutrients provided to nursing home residents.
2. Encourage Congress to change the prosthetic device benefit to restrict Part B coverage to a beneficiary's home and thereby recognize enteral nutrients as food covered under nursing room and board payment.

According to the report, CMS agrees with the recommendations and is taking steps to more accurately reflect supplier prices for nutrients provided to nursing home residents.