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How to Handle Medicare Documentation Audits

From: The Hospitalist, November 2013

Providing comprehensive, timely responses is crucial to preventing claims denial

by Carol Pohlig, BSN, RN, CPC, ACS

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.

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.

Frequently Asked Question

Question: Will an auditor deny 99233 if I meet the documentation requirements for history and exam but not decision-making?

Answer: The 99233 code represents 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.4 Technically, the documentation can be supported by history and exam, since the guidelines do not state that medical decision-making must be one of the two components required to support the reported visit level. However, medical necessity is viewed as the overall supportive criterion for payment consideration. Higher visit levels should not be selected according to the volume of documentation alone.

Anyone can document a “complete” history and exam, but the amount of history and exam obtained may not be appropriate for the nature of the patient’s presenting problem on a given date. In other words, it is not appropriate to bill a high-level service because the physician obtained a high-level history and exam, when a lower level of service more adequately reflects the patient’s condition. This is the rationale for letting medical decision-making guide visit level selection. If the documentation supports high-complexity decision-making, then 99233 can be reported as long as the history or the exam also meets the required level of documentation for 99233. Medical decision-making is the physician’s tool to consistently ensure that the medical necessity of the service is justified.
—Carol Pohlig

Responding to Requests

When documentation is requested by the payor, take note of the date and the provider for whom the service is requested. Be certain to include all pertinent information in support of the claim. The payor request letter will typically include a generic list of items that should be submitted with the documentation request. Consider these particular items when submitting documentation for targeted services typically provided by hospitalists:

  • Initial Hospital Care (99223)
    • Physician notes (including resident, nurse practitioner, or physician assistant notes);
    • Identify any referenced sources of information (e.g., physician referencing a family history documented in the ED record);
    • Dictations, when performed;
    • Admitting orders; and
    • Labs or diagnostic test reports performed on admission.
  • Subsequent Hospital Care (99233)
    • Physician notes (including resident, nurse practitioner, or physician assistant notes);
    • Identify multiple encounters/entries recorded on a given date;
    • Physician orders; and
    • Labs or diagnostic test reports performed on the requested date.

Documentation Tips

Because it is the primary communication tool for providers involved in the patient’s care, documentation must be entered in a timely manner and must be decipherable to members of the healthcare team as well as other individuals who may need to review the information (e.g., auditors). Proper credit cannot be given for documentation that is difficult to read.

Information should include historical review of past/interim events, a physical exam, medical decision-making as related to the patient’s progress/response to intervention, and modification of the care plan (as necessary). The reason for the encounter should be evident to support the medical necessity of the service. Because various specialists may participate in patient care, documentation for each provider’s encounter should demonstrate personalized and non-duplicative care.

Each individual provider must exhibit a personal contribution to the case to prevent payors from viewing the documentation as overlapping and indistinguishable from care already provided by another physician. Each entry should be dated and signed with a legible identifier (i.e., signature with a printed name).

The next several articles will address each of the key components (history, exam, and decision-making) and serve as a “documentation refresher” for providers who wish to compare their documentation to current standards.

Reader Question: Physician of Record for Hospice

Question: Your November 2012 article, “Hospice Care vs. Palliative Care” (p. 20), was very educational to me as a coder for a rural hospital. I have one other question, though. Would the AI modifier be appropriate to identify the primary physician of record for hospice (i.e., 99222-AI-GV)? Please advise, as I can’t find clear direction.
—A Conscientious Coder

Answer: Modifier AI would not be applicable for inpatient hospice services, as these services are considered under a different benefit and coverage criterion than acute inpatient stays. The hospice-attending physician is a doctor of medicine or osteopathy who is identified by the patient at the initiation of hospice care. This attending is responsible for having the most significant role in the determination and delivery of the individual’s medical care.8

If the patient does not have an attending physician who has provided primary care prior to or at the time of the terminal diagnosis, they may select a physician who is employed by the hospice. Payment for services by hospice-employed or hospice-contracted attending physicians is made to the hospice company. For these services, the hospice company establishes a charge and bills the Medicare contractor under the Medicare Part A benefit.8

The patient, however, may decide to use an “independent” attending physician (not employed by or contracted by the hospice to receive payment for professional services furnished to the patient). Professional care involving the hospice patient’s terminal condition provided by an independent attending physician is billed to the Medicare contractor through the Medicare Part B benefit. The Medicare contractor makes payment to the independent attending physician or beneficiary, as appropriate, based on the payment and deductible rules applicable to each covered service, if the provider alerts the payor that this service is not otherwise covered under the hospice Part A benefit.8

To distinguish as the hospice “attending of record” and receive separate payment for services, the independent attending physician must append modifier GV (Attending physician not employed or paid under arrangement by the patient’s hospice provider) to all services (initial and subsequent).
—Carol Pohlig

References

  1. Department of Justice, Office of Public Affairs. Tacoma, Wash., Medical Firm to Pay $14.5 Million to Settle Overbilling Allegations. Available at: www.justice.gov/opa/pr/2013/July/13-civ-758.html. Accessed September 20, 2013.
  2. Centers for Medicare and Medicaid Services. Comprehensive Error Rate Testing (CERT). Available at: www.cms.gov/Research-Statistics-Data-and-Systems/Monitoring-Programs/CERT/index.html?redirect=/cert. Accessed September 20, 2013.
  3. WPS Medicare, Legacy Part B. Are you billing these evaluation and management (e/m) services correctly? Available at: http://www.wpsmedicare.com/j5macpartb/departments/cert/2011-0912-billemservices.shtml. Accessed September 20, 2013.
  4. Abraham M, Ahlman J, Boudreau A, Connelly J, Levreau-Davis, L. Current Procedural Terminology 2013 Professional Edition. Chicago: American Medical Association Press; 2012:15-17.
  5. WPS Medicare, Legacy Part B. 1st Qtr. 2013 (Jan. - Mar.) - CERT Error Summary. Available at: http://www.wpsmedicare.com/j5macpartb/departments/cert/2013-1st-quarter-summary.shtml. Accessed September 20, 2013.
  6. Novitas Solutions. Analysis of JL Part B Comprehensive Error Rate Testing (CERT) Data - January thru March 2013. Available at: https://www.novitas-solutions.com/cert/errors/2013/b-jan-mar-j12.html. Accessed September 20, 2013.
  7. Centers for Medicare and Medicaid Services. Medicare Program Integrity Manual, Chapter 3, Section 3.2. Available at: www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/downloads/pim83c03.pdf. Accessed September 20, 2013.
  8. Centers for Medicare and Medicaid Services. Medicare Claims Processing Manual, Chapter 11, Section 40.1.2 Available at: www.cms.gov/Regulations-and-Guidance/Guidance/Manuals/Downloads/clm104c11.pdf. Accessed September 20, 2013.

This copy is for your personal, noncommercial use only. No part of this article can be reproduced without the written permission of the publisher. Order presentation-ready copies for distribution to your colleagues, clients, or customers by contacting our reprints department at reprints@wiley.com. Copyright © 2009 Society of Hospital Medicine, administered by John Wiley & Sons Inc.

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