Physician Coding and Billing Enforcement: What to Watch For

Physician Coding and Billing Enforcement: What to Watch For
CJ Wolf, MD writes enforcement action summaries for the YouCompli blog. These summaries provide real-world examples of regulators’ response to practices that don’t fully comply with regulations.  

This month’s article looks at physician coding and billing cases. It reflects remarks CJ made at HCCA’s 2022 Compliance Institute. (For more insights from the Compliance Institute, download our white paper on how compliance professionals can help healthcare institutions mitigate risk.)

Physicians are often seen as the drivers in healthcare. They examine patients, order labs and diagnostic testing. They perform procedures and surgeries, admit patients to hospitals, and document in the medical record.  

If you ask physicians what they think about coding and billing, most of them will tell you this: The rules do not make sense, are hard to understand, and are constantly changing. Most of them are doing their best to apply the confusing rules as they care for patients. Some might even be billing improperly on purpose. Either way, these examples highlight the consequences of “getting it wrong.” They offer clues for compliance professionals to spot training opportunities before they become enforcement actions. 

Billing for services not needed or received 

In March of 2022, a New Jersey rheumatologist was convicted by a federal jury for defrauding Medicare and other health insurance programs. She had billed for services that were either unnecessary or were not provided. Court documents demonstrated the physician billed for expensive infusion medication that her practice never purchased. She also fraudulently billed millions of dollars for allergy services that patients never needed or received. The doctor will be sentenced in July for multiple counts of healthcare fraud. Each count carries a maximum penalty of 10 years. 

Compliance officers should watch for:

Follow the money.  If a practice is billing millions of dollars for allergies services, that code or set of codes is likely to stand out as an outlier to compliance programs monitoring all their billing data.  Compliance officers should have a true sense of what their organization’s bread and butter services are. Then, they should perform regular audits of those high dollar, high volume services.  

Billing for unnecessary urine drug testing 

A Florida physician, serving as a medical director for a sober living facility, was found guilty of healthcare fraud. The federal jury found that he had ordered medically unnecessary urine drug tests. Court documents showed the physician unlawfully billed approximately $110 million of urinalysis (UA) drug testing services that were medically unnecessary for patients. Some of the evidence used at trial included inappropriate standing orders for UA drug tests in exchange for a monthly fee. As a condition of residency, patients had to submit to excessive and medically unnecessary urine drug testing three to four times per week.  

Evidence also showed the medical director did not review the UA drug test results and did not use the UA drug tests to treat the patients. This lack of review called the necessity of the tests into question.  In addition, the doctor had these same patients sent to his office so he could also fraudulently bill for services through his own practice. He faces up to 20 years in prison for healthcare fraud and wire fraud conspiracy. He faces another 10 years for each of eleven counts of healthcare fraud.  

Compliance officers should watch for:

If your organization allows for standing orders, you should have a written policy that guides their use. The policy should outline the risks and benefits of the standing orders. It should describe when they are appropriate and when they are not appropriate.  That policy should also outline the process for reviewing standing orders on a regular basis to determine if they are still appropriate.  If it’s been more than a year since you’ve reviewed a standing order, you may want to schedule a review soon.   

Modifier misuse: unbundling under modifier 25 

Billing and coding modifiers can also be an area of risk for physicians. In general, most encounters are reported with one Healthcare Common Procedure Coding System / Current Procedural Terminology (HCPCS/CPT) code. Medicare generally prohibits healthcare providers from separately billing for E&M services provided on the same day as another medical procedure. The exception is if the E&M services are significant, separately identifiable, and above and beyond the usual preoperative and postoperative care associated with the medical procedure.   

When the E&M service meets this definition, modifier 25 can appropriately be appended to the E&M code. When that is done, a physician is, in essence, certifying that the procedure and E&M are separate enough to meet the definition of the modifier. 

A urology practice learned an expensive lesson by allegedly using modifier 25 inappropriately. The practice agreed to pay $1.85 million to resolve allegations of modifier misuse. The case was initiated by a qui tam whistleblower.  Allegedly the practice used modifier 25 to improperly unbundle routine E&M services that were not separately billable from other procedures performed on the same day. As a result, the practice improperly claimed compensation from Medicare for certain urological services. The whistleblower had performed audits that allegedly showed an overall error rate for the practice of 58% with some physicians showing a 100% error rate.  

Compliance officers should watch for:

Any specialty could potentially run into problems with modifier 25. Consider common clinical scenarios such as a scheduled procedure. For example, in urology a physician might schedule a patient to return to the office another day for a scope procedure or a prostate biopsy. Frequently, upon return, the procedure is performed but a significant, separately identifiable evaluation and management service might not be performed. In those cases, it would not be appropriate to bill the procedure and an E&M service, but rather only the procedure.  Automatically billing an E&M with modifier 25 just because the patient was in the office would be a red flag. 

Conclusion 

Physicians and their practices need to be aware of coding and billing risks. Enforcement agencies and potential whistleblowers may identify outliers or flat-out fraud. Common mistakes may include a lack of documentation or not performing a service but billing for it anyway. Other common mistakes are billing for procedures or services that were performed but were not medically necessary and misuse of medical codes and/or modifiers.  

Managing regulatory change is a critical way to avoid enforcement actions. YouCompli is the only healthcare compliance solution that combines actionable, regulatory analysis with a simple SaaS workflow to help you manage regulatory change. Read more about the rollout and accountability of requirements or schedule a demo.

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Compliance officers reflect on COVID pivots and preparing for the end of the public health emergency

Featured speakers: Craig Bennett, Vice President and Chief Compliance Officer, Boston Medical Center; Rachel Lerner, Esq., General Counsel & Chief Compliance Officer, Director, Center for the Prevention of Elder Abuse and Neglect, Hebrew SeniorLife; Maria Palumbo, Chief Compliance & Privacy Officer, Lawrence General Hospital. Moderated by Larry Vernaglia 

Bennett, Lerner and Palumbo addressed the Massachusetts Health and Hospital Association’s Healthcare Legal Compliance Forum in December 2021. (Read a summary.) This recap of their remarks looks at how their Compliance teams responded to COVID and have continued to partner with their organizations to manage regulatory change. It also looks at regulatory changes they are planning for in 2022. To access the full session recording, please contact the Massachusetts Health and Hospital Association.  

Initial COVID response

The panel reflected on their organizations’ initial response to COVID. “All of us had to pivot on a dime,” said Bennett. “We hadn’t had an opportunity to plan for it. Instead, we worked daily that first quarter to make sure we were as compliant as we could possibly be.” He was part of a team that looked at various waivers, platform security, privacy and other issues affected by the public health emergency to provide care safely.  

Lerner had a similar experience. “We immediately convened interdisciplinary committee so we could make changes quickly. Telehealth was really new territory for us, and we had to look at our outpatient medical practice, and home- and community-based care,” she said. “Tracking COVID 19 waivers was a team sport between Legal and Compliance. We broke down some silos, and that may be one good lasting benefit of this experience.”  

Palumbo and her colleagues focused on creating templates and consistency for documentation to make things as straightforward as possible for clinicians. That included having them track their patient contact time in minutes rather than defaulting to 20-minute increments. “We’re auditing these processes now to be sure we’re prepared when it gets looked at externally.”  

Accessibility concerns and solutions

Palumbo illustrated how healthcare organizations had to respond to the specific needs of their communities. “Our population tends not to have computers or printers at home,” she said. It wasn’t enough to deliver COVID test results to the portal, because people needed printed results to return to work or school. Without a printer, they were stuck. “We were like the take-out line at a restaurant – we not only have to contract with the state to provide nine-lane testing, we also have a multiline drive up for picking up your covid test results because people need that hard paper.”  

Building a culture of compliance

Bennett reflected on the tremendous amount of change and adaptation healthcare staff managed over the past two years. “I have to commend all hospital staff in being able to pivot and not missing a beat,” he said. His organization paused or reprioritized certain issues, but they maintained a focus on complying with regulations. That meant checking in with people regularly. That helped him assess whether people were getting the support and resources they needed related to their work. He expects to continue looking for ways to support staff. “We’ll continue to try to add flexibility to meet the needs of our staff and the needs of our patients and organization.” 

Palumbo, too, is working to meet people where they are at. She recently “camped out in the cafeteria,” she said. “I couldn’t believe the results: About 350 people came to talk to me, including residents, physicians, surgeons, nurses, case managers, and housekeeping staff.” They asked about patient privacy and other compliance issues. “So much came up during COVID but we didn’t stop to work through everything or stop to talk to each other. I’ll try to do that at least once a quarter.”  

New compliance issues

Palumbo walked through some upcoming regulatory changes she’s watching. This included the Medicare Final Physician Fee Schedule and noted that the Appropriate Use Criteria changes are delayed until the January first that follows the end of the pandemic. She encouraged everyone to understand the documentation requirements for using nurse practitioners for some portion of care as well as the changes to billing for surgeon and ICU provider time.  

New rules also allow audio-only telehealth visits for behavioral health as long as the patient wants it and the physician documents it properly.  

Balancing privacy, efficiency, safety, and cybersecurity

Lerner continues to address privacy concerns related to COVID testing and contact tracing. “We were working so hard to limit the spread of the disease in our senior living facilities,” she said. “It was hard to navigate contact tracing and privacy.” Now she is addressing cybersecurity insurance requirements, for her own organization and making sure vendors have sufficient insurance. “Moving to remote workforces and telehealth, the cybersecurity exposure is higher than it’s ever been,” she said. “For instance, people working from home might want to print documents, but we have to keep them from printing PHI at home or mailing things insecurely when someone can’t come pick it up.”  

Managing regulatory change

Lerner said she spends a lot of time looking at regulatory changes to understand their implications to her organization. “It can take us a long time to decide ‘does this apply to us?’ And then figure out what to do with it. Then we have to figure out what to do with that information in bits and pieces. It is certainly a complex, ever-changing universe on that front.” She spoke of Compliance’s key role in knitting together all that information to help the organization act on it and integrate it into daily processes.  

YouCompli sponsored MHA’s 2021 Healthcare Legal Compliance Forum. We provide a complete solution to help healthcare compliance organizations manage regulatory change. Find out more about YouCompli.  

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Health organizations tackle regulatory change at Mass. conference

The Massachusetts Health and Hospital Association recently convened its Healthcare Legal Compliance Forum to update members on key areas of regulatory change, compliance and enforcement in this late COVID era. 

Current and former law enforcement officials, healthcare compliance practitioners, attorneys and consultants gave a broad view of the priorities, challenges and opportunities facing the Compliance profession.  

Federal and State Enforcement Update 

Featured speakers: Toby R. Unger, Chief of Medicaid Fraud Division, Office of the Massachusetts Attorney General; and Patrick Callahan, Healthcare Fraud Unit, US Attorney’s Office. Moderated by David Schumacher, Partner, Hooper, Lundy & Bookman. 

Unger and Callahan noted that the pandemic shifted the makeup of their case load. It reduced the rate of whistleblower and other fraud complaints, and for Unger at least, abuse cases increased.  

They talked about how health organizations can effectively partner with law enforcement. They generally see the best outcomes when Compliance and Legal teams bring issues to them or work quickly with them to find data and resolve issues. 

And they shared their take on effective Compliance functions. A good Compliance department doesn’t need to be huge with a lot of people and formal processes,” Callahan said. “A good department is one that has a real effect when they ask leadership to make a change. They have a voice that gets leadership’s attention, and they can have questionable practices stopped during an investigation. When they ask to press pause, they are listened to.”  

Read More: State and Federal enforcement agencies anticipating more complex investigations as COVID-era practices emerge

Compliance Officer Roundtable  

Featured speakers:  Craig Bennett, Vice President and Chief Compliance Officer, Boston Medical Center; Rachel Lerner, Esq., General Counsel & Chief Compliance Officer, Director, Center for the Prevention of Elder Abuse and Neglect, Hebrew SeniorLife; Maria Palumbo, Chief Compliance & Privacy Officer, Lawrence General Hospital. Moderated by Larry Vernaglia. 

Bennett, Lerner, and Palumbo shared their experience over nearly two years of pandemic-influenced healthcare compliance. They talked about how they collaborated to manage regulatory change and reinforce their culture of compliance. They also talked about the regulatory changes they are planning for in 2022.  

Lerner said she spends a lot of time looking at regulatory changes to understand their implications to her organization. “It can take us a long time to decide ‘does this apply to us?’ And then figure out what to do with it. Then we have to figure out what to do with that information in bits and pieces. It is certainly a complex, ever-changing universe on that front.” She spoke of Compliance’s key role in knitting together all that information to help the organization act correctly and then integrate it into daily processes. 

Read More: Compliance officers reflect on COVID pivots and preparing for the end of the public health emergency

Telehealth in the Pandemic and Beyond  

Featured speakers: Marcus Hughes, Associate General Counsel, UMass Memorial Health; Meg Cosgrove, Associate General Counsel, Beth Israel Lahey Health. And moderated by Jeremy Sherer, Healthcare Attorney, Hooper, Lundy, & Bookman. 

Hughes and Cosgrove discussed interstate telehealth compliance issues. They talked about the hard adjustments providers have to make as demand for telehealth surges and scrutiny of out-of-state practice increases. They shared ways they are preparing for the regulatory changes that will come with the end of the public health emergency.  

As waivers expire, Compliance officers have to increase their efforts at making sure providers understand licensing requirements and the risk of non-compliance. 

Hughes noted that there is a common belief that there is a national framework for remote care, but actually there isn’t. “Now that we’re in the late stage of the pandemic, we have to educate our staff to dispel some of the myths that are out there. And we have to make sure they know that the COIVD waivers are coming to an end.”  

Read More: Healthcare GCs look at telehealth compliance in the Pandemic and beyond

COVID-19 Hot Compliance Topics  

Featured speaker: Martie Ross, Office Managing Principal, PYA  

Ross covered federal vaccine mandates. unwinding regulatory flexibilities, and provider relief fund audits and enforcement. Her detailed slides are available from PYA here. They provide great insight for Compliance practitioners. 

Ross recommends that you review and track changes to internal policies and practices and establish a process to completely unwind. “As a compliance officer, it’s time to back through your compliance documentation over the past two years and think about how you’re going to unwind from these changes,” she said. 

Read More: Compliance expert Martie Ross explains critical regulatory change management issues facing healthcare in 2022

YouCompli sponsored MHA’s 2021 Healthcare Legal Compliance Forum. We provide a complete solution to help healthcare compliance organizations manage regulatory change. Find out more about YouCompli.  

Subscribe to get the latest articles about healthcare regulatory changes.

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