Electronic Health Records Contributing to Upcoding and Medical Billing Fraud, Says HHS Report

by | Last updated Nov 15, 2023 | Published on Mar 4, 2014 | Medical Billing

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Though CMS is encouraging Medicare ‘meaningful use’ of EHRs by paying over $22.5 billion as incentives, a recent report released by the Office of the Inspector General for the Health and Human Services Department (HSS) says that CMS and its contractors have failed to ensure that the technology is not being used for inflating costs and overbilling. The report says Medicare has provided ‘limited guidance’ to its contractors on addressing potential fraud and misuse of the drive to digitize patient records. HSS officials have issued severe warnings against health care professionals using Web based medical billing systems to overbill.

There are two ways in which EHR contribute to fraud practices according to the HHS report:

  • Copy-pasting – This technique, also known as cloning, allows doctors and nurses to copy-paste information from one document to another and reduce the time spent to enter patient data. However, this also allows users to indicate more expensive services (physical exams or treatment) than were actually provided. It could also happen that they are copy-pasting wrong information in their attempt to speed up digitization of patient records to meet the electronic health record (EHR) mandate deadline of January 1, 2015. It is pointed out that doctors and hospitals are overcharging Medicare for the treatment they provide and that the fraud could run into millions of dollars.
  • Overdocumentation – The templates of some EHR systems populate fields automatically while others generate extensive documentation based in a single click on a checkbox. If these mistakes are not properly edited, false or irrelevant documentation would be entered, and the services documented would be inflated compared to what the practitioner actually rendered.

It is very difficult to assess whether healthcare providers make such errors because they fail to double-check the accuracy of information or whether they deliberately enter wrong information to inflating costs. A formal policy regarding the use of cloning technique is therefore very important. HSS authorities found that three-quarters of surveyed hospitals had no such formal policy.

The lack of guidance for Medicare contractors on how to handle payments and recognize the fraudulent practices in EHRs is a major issue. Though CMS appoints administrative and program integrity contractors including Medicare Administrative Contractors (MACs), Zone Program Integrity Contractors (ZPICs) and Recovery Audit Contractors (RACs) to investigate fraud, these are based on traditional medical records. They need to adjust their techniques to identify improper payments with EHRs.

It is imperative to find solutions for the safe and legitimate use of EHRs. HHS recommends two solutions:

  • CMS should provide proper guidance to its contractors on detecting fraudulent practices associated with EHR use. They should work with their contractors to find out the best practices and develop guidance and tools.
  • CMS should provide proper directions to its contractors on the use of audit logs. As audit log data distinguishes EHRs from paper records, it could be valuable for contractors when they review medical records.

The report says CMS completely agreed with the first recommendation and partially agreed with the second one.

Health care institutions need to coordinate with their EHR vendors and implement a stringent policy for maintaining the accuracy of documentation. Many hospitals that invested in EHRs are finding their systems are complicated to use and taking up a lot of physicians’ valuable time. The New York Times mentions a study which found that emergency-room physicians in a community hospital spent 43% of their time on using EHRs and only 28% on caring for patients directly.

A professional medical billing and coding company can help health care providers avoid billing errors and adhere to industry guidelines while implementing EHR.

Julie Clements

Julie Clements, OSI’s Vice President of Operations, brings a diverse background in healthcare staffing and a robust six-year tenure as the Director of Sales and Marketing at a prestigious 4-star resort.

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