Explore this issue:November 2013
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The recent announcement of a settlement by a physician firm should cause the HM community to pause and take inventory. The settlement “addressed allegations that, between 2004 and 2012, [the firm] knowingly submitted to federal health benefits programs inflated claims on behalf of its hospitalist employees for higher and more expensive levels of service than were documented by hospitalists in patient medical records.”1
This civil settlement highlights the vigilance being exercised against healthcare fraud and demonstrates the coordinated efforts in place to tackle the issue. To put the weight of this case in perspective, consider the breadth of legal entities involved: the U.S. Department of Justice; the U.S. Attorney’s Office; the U.S. Department of Health and Human Services; the U.S. Department of Defense; the U.S. Office of Personnel Management; the U.S. Department of Veterans’ Affairs; and the TRICARE Management Activity Office of General Counsel.1
The underlying factor in the settlement is a common issue routinely identified by Medicare-initiated review programs such as CERT (Comprehensive Error Rate Testing). CERT selects a stratified, random sample of approximately 40,000 claims submitted to Part A/B Medicare Administrative Contractors (MACs) and Durable Medical Equipment MACs (DME MACs) during each reporting period and allows the Centers for Medicare and Medicaid Services (CMS) to calculate a national improper payment rate and contractor- and service-specific improper payment rates.2 The CERT-determined improper payment rate identifies services that have not satisfied Medicare requirements, but it cannot label a claim fraudulent.2
Incorrect coding errors involving hospitalists are related to inpatient evaluation and management (E/M) services that do not adequately reflect the documentation in the medical record. For example, WPS Medicare identified the following error rates for claims submitted 7/1/11 to 6/30/12: 45% of 99223 (initial hospital care, per day, for the evaluation and management of a patient, which requires these three key components: a comprehensive history, a comprehensive exam, and medical decision-making of high complexity); and 34% of 99233 (subsequent hospital care, per day, for the evaluation and management of a patient, which requires at least two of these three key components: a detailed interval history, a detailed examination, and medical decision-making of high complexity).3,4 More recent WPS Medicare data in first quarter of FY2013 reveals a continuing problem but an improved error rate.5 Novitas Solutions offers additional support of these findings.6
Based on efforts that identify improper payments, MACs are encouraged to initiate targeted service-specific prepayment review to prevent improper payments for services identified by CERT or recovery audit contractors (RACs) as problem areas, as well as problem areas identified by their own data analysis.7 For this reason, hospitalists may see prepayment requests for documentation by Medicare for services that are most “problematic” (e.g., 99223 and 99233). This occurs when a claim involving these services is submitted to Medicare. The MAC suspends all or part of a claim so that a trained clinician or claims analyst can review the claim and associated documentation in order to make determinations about coverage and payment.7 Responding to these requests in a timely manner is crucial in preventing claim denials.