BillingsDespite the report from the HHS Inspector General pointing out the Medicare overcharges of $6.7 billion, the Centers for Medicare and Medicaid Services (CMS), which runs Medicare is not ready to investigate overpayments to doctors. CMS says it doesn’t plan to review the billings of doctors who almost always charge for the most expensive visits because it isn’t cost-effective to do so.

A review by the Office of Inspector General (OIG) found that Medicare inappropriately paid almost $6.7 billion for Evaluation & Management services in 2010. Released in May 2014, the review estimates that overpayments account for 21 percent of the $32.3 billion spent on Part B claims for E/M services.

A medical record review was conducted of a random sample of Part B claims for E/M services from 2010, stratifying claims from physicians who consistently billed higher level codes for E/M services and claims from other physicians. 657 Medicare claims were gathered for review. Certified professional coders determined whether the E/M service documented in the medical record for each sampled claim was correctly coded and/or sufficiently documented.

The investigation found that 42 percent of claims for E/M services in 2010 were incorrectly coded, which included both upcoding and downcoding, and 19 percent lacked documentation. It was also found that claims from high-coding physicians were more likely to be incorrectly coded or insufficiently documented than claims from other physicians. Based on the findings, OIG has advised CMS to consider making the E/M claims submitted by high-coding physicians a priority in their medical review strategies.

It’s not the first time. Earlier in 2012, another study from OIG reported that physicians increased their medical billing of higher level codes, which yield higher payment amounts, for E/M services in all visit types from 2001 to 2010.

Other 2012 cases on Medicare overpayments reported by REUTERS include:

  • Medicare paid doctors $457 million in 2012 for 16 million tests to detect drugs – from prescription narcotics to heroin.
  • Medicare administrators paid Three Connecticut doctors a total of $1.4 million for nearly 24,000 drug tests in 2012 – on just 145 patients.

Are the physicians billing properly? This is the main concern here. Errors in payment often results from wrong medical codes, duplicate submission of the same service or claim, payment for excluded or medically unnecessary services and inaccurate documentation. Whether CMS reviews billings of overcharges or not, it is crucial for any healthcare entity to ensure accurate health record documentation and follow the correct medical billing standards.