Head Off $2 Million Medical Billing Fraud and Abuse Violation

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Head Off $2 Million Medical Billing Fraud and Abuse Violation

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Head Off $2 Million Medical Billing Fines

You could be fined up to $11,000 for each false item or service you submit to Medicare. That means, your total penalty amount could be HUGE – reaching into the millions as it did for one physician practice. Halt massive penalties from crippling your practice by fixing these common medical billing fraud and abuse errors.

In June, a neurology practice in Alaska was fined $2 million for fraudulent billing under the False Claims Act (FCA). The state attorney’s office and the US Department of Health and Human (HHS) Services Office of Inspector General (OIG) found that the group had committed multiple counts of medical billing fraud and abuse stemming from a whistleblower lawsuit.

Mistakes like those that landed Alaska Neurology Center in hot water are easy to make. The law makes providers libel for knowingly submitting a fraudulent claim to the government, including Medicare and Medicaid. In addition to the per-claim fines, other penalties for False Claims Act fraud and abuse violations include:

  • Fines: Payment of three times the monetary damage caused to the government
  • Enrollment Revocation: Exclusion from participation in Medicare and Medicaid
  • Prison: Criminal penalties, including jail time

No specific intent to commit fraud and abuse is required. “Knowing,” according to the law, includes not only actual knowledge, but what you should reasonably know and also reckless disregard. An excuse like “I didn’t realize I was upcoding” won’t get you far.

To stop False Claims Act violations—and seven-figure fines—implement these five medical billing fraud and abuse fixes immediately:

1. Verify Documented Dates of Service

Alaska Neurology Center submitted claims with false dates of service to obtain increased reimbursement. While you may not be trying to deceive Medicare, you must ensure that your dates of service on your claim match the patient documentation.

Pay attention to service caps. For example, if Medicare will pay for a service only once per 28 days (4 weeks), make sure the full 28 days has passed. Don’t try to squeeze the service in earlier, say, at the beginning of the 4th week.

2. Limit Services to Licensed and Qualified Clinicians

Alaska Neurology allowed medical assistants to provide infusions, and billed for them as if a physician performed those services. Be sure that clinicians are only providing services that are within their scope of license or practice.

When a non-physician clinician (i.e. a licensed practicing nurse) is performing a service, take care to meet supervision requirements:

  • General: Physician’s overall direction is required, but their presence is not
  • Direct: Physician must be present in the office and immediately available
  • Personal: Physician must be in the room when the procedure is performed.

3. Select Code for Exact Service

It is imperative that your clinical documentation meets all medical necessity requirements for the service you’re billing. For example, Alaska Neurology filed claims for physical therapy, when the service provided was actually massage therapy (which isn’t reimbursable).

4. Avoid Unbundling

Do not routinely break out the components of bundled codes to bill them separately. Use modifier 59 (Distinct procedural service) sparingly, and only when there is no modifier more appropriate. Do not use modifier 59 to prevent services from being bundled or bypass payer edits. And remember: When using modifier 59, always append it to the service that has the lower reimbursement rate.

5. Confirm Documentation Before Altering Code

You’re reworking a claim that’s been rejected for lack of documentation. The provider is really busy and you’re up against a deadline, so instead of querying the provider, you simply change the diagnosis code to one that meets the documentation that’s available and resubmit it. If that claim is paid, you’ve just committed fraud.

Opportunities for violating the False Claims Act are everywhere. But, with a little help, you can take actions to avoid massive medical billing fraud and abuse penalties.

That’s where attorney, Heidi Kocher, BS, MBA, JD, CHC, can help. Heidi’s online training, “Billing: Head Off Costly Legal Headaches,” will give you the practical advice you need.


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Meet Your Writer

Jen Godreau
CPC, CPMA, CPEDC, COPC, AHIMA ICD-10-CM/PCS Approved Trainer

Content Director

Jen Godreau, CPC, CPMA, CPEDC, COPC, AHIMA ICD-10-CM/PCS Approved Trainer is an expert in practice management, billing and coding, and revenue cycle management, and brings almost 20 years of experience to the content team at Training Leader. Prior to joining Training Leader, Jen led implementations of EMRs and revenue cycle management services including credentialing. She has led teams who have created numerous software programs and tools for compliance, coding, and auditing. Her passion for all things compliance and coding has filled thousands of articles and allowed her to provide practice management consulting and due diligence for hundreds of practices.

Jen's advocacy led to the overturning of neonatology supervision restrictions, creation of new CPT ENT codes, and winning of Medicare monitoring auditing contracts. She wrote the diagnosis study guide for AAPC's Certified Otolaryngology Coder (CENTC) exam and edited the AAPC Professional Medical Coding Curriculum.

Jen has a Bachelor of Arts from Wittenberg University in Springfield, Ohio. She became a Certified Professional Coder (CPC) in 2001, added her designation as a Certified Pediatric Coder (CPEDC) in 2009, became a Certified Medical Coding Auditor (CPMA) in 2010, and a Certified Ophthalmology Professional Coder (COPC) in 2017. She is an AHIMA ICD-10-CM/PCS approved trainer.

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