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Health Integrity Educational Letter Sent to Home Health Agencies in Texas and Oklahoma

November 8, 2013 by  
Filed under Home Health & Hospice

Has your home health agency received a Health Integrity educational letter?(November 8, 2013):  Health Integrity serves as the Zone Program Integrity Contractor (ZPIC) for Zone 4.  This zone is comprised of Texas, Oklahoma, New Mexico and Colorado.  Generally, Health Integrity has been assigned responsibility for handling Medicare Part A, Medicare Part B, and Durable Medical Equipment (DME) claims.  Health Integrity has been especially aggressive in its review and audit of home health care claims submitted to Medicare for payment by providers within Zone 4.  While prior enforcement efforts have typically included postpayment audits and placing problem providers on suspension, recent enforcement efforts have tended to focus on actions designed to prevent the submission of improper claims in the first place, such as placing a provider on prepayment review. Most recently, home health agencies in Texas and Oklahoma received a Health Integrity educational letter advising targeted specific home health agencies that Medicare is concerned about certain practices of home health providers.  As the letter detailed, home health agencies receiving these letter have been “flagged” by the contractor as:

“[S]ubmitting claims and/or billing patterns indicative of higher risk of aberrant practices in comparison to expectations, standard thresholds, and/or established norms.”

As the Health Integrity educational letter further sets out, there are a number of specific Medicare medical necessity, documentation and other regulatory concerns that are currently under review by the ZPIC.

 I.  Nature of Medicare Concerns Discussed in the Health Integrity Educational Letter:

The various challenges faced by home health agencies may vary from one to agency to another.  Nevertheless, there are a handful of “general” risks facing all home health agencies that are outlined in Health Integrity’s November 1st letter.  These areas of recurring concern include:   

A.    Is the Patient Truly Confined to His / Her Home?

As Health Integrity’s letter states, under Chapter 7 § 30.1 of the Medicare Benefit Policy Manual, a patient’s medical records must accurately reflect that the patient qualified as “homebound” during the specific period under review.  Denials based on lack of homebound status are not new – home health agencies should have a solid handle on these requirements by now.  Having said that, it isn’t merely enough for a patient to merely qualify as homebound – you and your staff need to fully and accurately document the specific clinical facts which support each patient’s homebound status.  Detail is important.  Is the patient ever absent from the home?  If so, what is the reason for the absence?  How long were gone?  In consideration of any absences, does the patient continue to qualify as homebound?  All of these are important questions to be asked.

Importantly, as of November 19, 2013, the Centers for Medicare and Medicaid Services (CMS) will require Medicare beneficiaries to meet two sets of criteria before their home health agency even considers whether they have an ordinary inability to leave home.  As MLN  Matters Number: MM8444 provides:

An individual shall be considered “confined to the home” (homebound) if the following two criteria are met:


The patient must either:

Because of illness or injury, need the aid of supportive devices such as crutches, canes, wheelchairs, and walkers; the use of special transportation; or the assistance of another person in order to leave their place of residence


Have a condition such that leaving his or her home is medically contraindicated.

If the patient meets one of the criteria in Criteria-One, then the patient must ALSO meet two additional requirements defined in Criteria-Two below.


There must exist a normal inability to leave home;


Leaving home must require a considerable and taxing effort.

B.    Are Timely, Valid Physician Orders in the Record Which Support the Care Provided?

How was each patient referred to your home health agency for care and treatment?  What are the qualifications of the referring physician?  Who signed the patient’s “Plan of Care”? When was it received back from the physician? What types of treatment were ordered by the referring physician?  Were any verbal orders documented in the record?  Have all Orders been signed and dated in a timely fashion?  Were all supplemental physicians’ orders signed and dated before the claim was billed to Medicare? If so, identify the orders and list the dates they were signed. Were the services billed properly?

C.    Is there a Need for Skilled Care?      

Documenting a patient’s need for and receipt of “skilled care” has been a perennial problem for many home health agencies.  In most instances, we have found that the agency’s clinical staff has not been properly trained to document skilled care issues. What specific skilled services (e.g. injections, wound care, catheter changes, gait training) were provided to the patient during a particular episode?  Ultimately, home health agencies should re-familiarize themselves with Chapter 7 §§ 40.1, 40.2 of the Medicare Benefit Policy Manual.

D.    Are “Length of Stay” Issues to be Considered?

Data mining is enormously helpful to the government in identifying home health providers whose business and / or clinical practices essentially make them an “outlier” when compared to the practices of their peers.  A patient’s length of stay on service is one of the most common comparisons used by ZPICs when making targeting decisions.  Provide a detailed rationale as to why the patient was admitted to / recertified for home health services at the beginning of this episode.

II.   Why is Our Home Health Agency Receiving a Health Integrity Educational Letter?

Not all home health agencies in Texas, Oklahoma and the rest of Zone 4 received a copy of Health Integrity’s “Educational Letter” dated November 1, 2013.  If your home health agency  received a copy of Health Integrity’s letter, it could be based on the fact that your agency has previously received a number of ADR’s, been placed on prepayment review or been subjected to a prior review or one type or another. Alternatively, your home health agency may have been sent Health Integrity’s letter based solely on the ZPIC’s data mining findings.  Your agency may be an outlier in terms of its business or clinical statistics.  As such, your agency has now been “flagged” by the ZPIC.

In any event, it is extremely important for you to recognize the importance of Health Integrity’s Educational Letter. Pursuant to the Medicare Modernization Act of 2003, 42 U.S.C. § 1395ddd(f)(3), (§ 1893(f)(3) of the Act):

A Medicare contractor may not use extrapolation to determine overpayment amounts to be recovered by recoupment, offset, or otherwise unless the Secretary determines the –

(A)  there is a sustained or high level of payment error; or

(B)  documented educational intervention has failed to correct the payment error.

The CMS Medicare Program Integrity Manual § 3,10.1.4 provides specific guidance on when statistical sampling may be used. As the section states:

“The PSC BI units and the contractor MR units shall use statistical sampling when it has been determined that a sustained or high level of payment error exists, or where documented educational intervention has failed to correct the payment error.”

Both fundamental fairness and a plain reading of both the underlying statute and CMS guidelines require that Medicare overpayment auditors (including Health Integrity) have justification before beginning a statistical sampling of a provider’s Medicare claims.  If the auditors could select anyone for audit without cause, the administrative burden on providers would be extraordinarily high.  Therefore, the justification for a high error rate or failed education must be based on evidence that exists before the sample is selected.  In light of the “Educational Letters” recently sent to home health providers by Health Integrity, the ZPIC will now be free to seek extrapolated damages since they can now allege that continuing problems were not corrected through educational intervention.

III.  How Should Our Home Health Agency Respond to Health Integrity Educational Letter?

If your agency has received a Health Integrity Educational Letter, one option would be for you to just take the information in stride, remind your staff of their regulatory obligations and hope for the best.  A more affirmative approach would be to review your practices and ensure that the concerns set out in Health Integrity’s letter are not problems in your organization.  Should you find that deficiencies are present, remedial action should immediately be taken and any overpayments must be immediately refunded to Medicare.  While the specific approach taken by your home health agency in responding to Health Integrity’s concerns will differ from one organization to another, we believe that it is imperative that all recipients review their practices to help better ensure that Medicare’s regulatory requirements are being met.

Healthcare LawyerRobert W. Liles serves as Managing Partner at Liles Parker, Attorneys and Counselors at Law.  Our firm represents home health agencies and other health care providers around the country in connection with ZPIC enforcement actions, prepayment reviews, postpayment audits, and a wide range of other regulatory matters.  Should you have any questions or concerns regarding your home health agency, please give us a call for a free consultation: 1 (800) 475-1906

Home Health Compliance Risks are a Significant Issue for Texas and Oklahoma Agencies

March 21, 2012 by  
Filed under Home Health & Hospice

Agencies Should Fully Evaluate Their Home Health Compliance Risks.

(March 21, 2012): Over the past few weeks, several important events have occurred which should have home health agencies in Texas, Oklahoma and the rest of the country rethinking the adequacy of their existing compliance efforts. The home health compliance practices of many agencies have long been a concern of the Department of Health and Human Services, Office of Inspector General (OIG) and the Centers for Medicare & Medicaid Services (CMS).  It is therefore essential that agencies assess their home health compliance risks.  Last week, the OIG issued yet another report recommending that CMS further tighten its oversight of home health compliance through the implementation of additional sanctions for non-compliant home health agencies.  Notably, OIG’s report has been issued literally “on the heels” of a significant home health fraud investigation centered in the Dallas, Texas area which was reportedly initiated by Health Integrity, the Zone Program Integrity Contractor (ZPIC) covering Texas and Oklahoma.

I. The OIG’s Home Health Report of Fraud and Abuse:

On March 2, 2012, the OIG issued a report entitled, “Intermediate Sanctions for Noncompliant Home Health Agencies” which examined CMS’ ongoing efforts to identify and sanction home health agencies that were non-compliant with Medicare’s applicable conditions of participation. As detailed in the report, CMS (formerly known as the Health Care Financing Administration (HCFA)) was directed in 1987 to develop and implement “intermediate sanctions” against home health providers violating Medicare rules. These sanctions were anticipated to include civil monetary penalties (CMPs), Medicare payment suspension, and even appointment of temporary management of a noncompliant agency. Initially required to implement these sanctions under the Omnibus Budget Reconciliation Act of 1987 (OBRA 1987), CMS issued a Notice of Proposed Rulemaking in 1991, but subsequently withdrew this notice in 2000.

CMS has stated that it anticipates publishing new proposed rules in September 2012 addressing these “intermediate sanctions.”  Frankly, home health providers and their associates cannot continue down the current path.  While both CMS and the OIG recognize the important role played by home health agencies in the care and treatment of homebound Medicare beneficiaries, the government has made it abundantly clear that participating providers must fully comply with applicable medical necessity, coverage, documentation, coding and billing rules.  Non-compliant providers are being immediately suspended and / or excluded from participating in the Medicare program.  Moreover, health care providers who engage in nefarious activities are being aggressively prosecuted.

II.  Health Integrity’s Audit of Home Health Agencies:

Since winning the contract in 2009, Health Integrity, the Zone 4 ZPIC covering Texas, Oklahoma, New Mexico and Colorado, has conducted a wide variety of Medicare post-payment audits throughout Zone 4.  To their credit, Health Integrity’s post-payment audits have not been limited to merely large metropolitan areas.  Rather, the ZPIC is in the process of “leaving no stone unturned,” conducting home health compliance audits and reviews throughout Zone 4, regardless of size, revenues and / or location.

To be clear, Health Integrity’s audits have not been limited to only home health services.  The ZPIC has actively reviewed the operational, coding and billing practices of a wide variety of Part B health care providers in Zone 4.  Nevertheless, the ZPIC does appear to have redoubled its audits of home health compliance for Texas and Oklahoma providers who appear to be outliers through data-mining activities. After reviewing the homebound status of both prior and current patients, clinicians working for Health Integrity have been thoroughly assessing the care and treatment provided by billing home health agencies.  After carefully assessing the medical records forwarded by the home health agency, in many cases Health Integrity has concluded that it is appropriate to seek extrapolated damages based on the Medicare post-payment audit conducted.

III. Health Integrity is on the Front Line of Home Health Fraud Identification:

Despite the fact that most Texas home health agencies are doing their best to operate within the four corners of the law, there are still a number of providers who are continuing to engage in wrongdoing. Texas home health providers recently received significant negative media coverage for fraudulent and abusive billing practices allegedly committed by agencies within their ranks. As you may have heard, just last week a physician and several home health agency “recruiters” in the Dallas-Fort Worth area were indicted in the largest Medicare fraud scheme in history, allegedly totaling nearly $375 million for home health services either not needed or never provided. Additionally, it was noted that over 75 home health agencies to whom referrals were made have also been implicated in the wrongdoing.  Such an enormous scheme only further demonstrates the fact that fraudulent activity in home health services is continuing, despite the fact that most Texas home health providers are well-meaning organizations, trying in good faith to provide medically necessary services to our nation’s most sick and disabled. Nevertheless, such accusations only increase suspicion and scrutiny of the entire home health industry in this region.

In a separate incident, a news reporter recently had a healthy, yet elderly, woman pose undercover as a potential home health patient when visiting a physician in South Texas.  The reporter noted that the healthy patient was allegedly improperly diagnosed and certified as qualified for home health services. While some providers may be concerned about the use of patients in undercover sting operations such as this, the fact is that improper conduct is occurring, at both the physician referral and the home health agency level, clearly illustrating why law enforcement is concerned that fraud is continuing to occur in this area of practice. In light of these and similar cases, it is clear why Health Integrity appears to be “ramping up” its reviews of home health providers throughout Texas and Oklahoma.

IV.  What Steps Can an Agency Take to Home Health Compliance Risks?

To be clear, there is no proverbial “silver bullet” that can be used by a home health agency to avoid the scrutiny of Health Integrity and / or law enforcement.  Every home health agency in Texas and Oklahoma should expect to be audited.  Rather than wait for such an eventuality, home health agencies should affirmatively review their operations, coding and billing practices to ensure that their practices squarely fall within the rules.  Although not all-inclusive, the following five steps can serve as an excellent starting point when preparing for an audit of your agency’s home health claims:

Recommendation #1  Don’t assume that your current practices are compliant, check them out! Conduct a “gap” analysis and implement an effective Compliance Plan.  While most, if not all, home health agencies will profess to have a Compliance Plan already in place, the real question is whether the existing plan is “effective,” or merely a sample that was obtained by the agency in the past.  No two home health agencies are alike.  As a first step, a home health provider needs to engage qualified legal counsel to advise the organization on whether the agency is properly operating at a baseline level of compliance.  If not, remedial steps must be taken so that the agency can move forward in a compliant fashion.

As you will recall, Section 6401 of the Affordable Care Act (ACA) (generally referred to as the “Health Care Reform Act”) states, “. . . a provider of medical or other items or services or supplier within a particular industry, sector or category shall, as a condition of enrollment in the program under this Title . . . establish a compliance program.”  Although HHS-OIG has not announced the deadline for home health agencies to meet this requirement, it is only a matter of time before all health care providers who choose to participate in the Medicare program must have an effective Compliance Plan in place in order to remain a participating provider.

Recommendation #2 As you review your claims, you should abide by the following:  First, “If it doesn’t belong to you, give it back.”  Conversely, “If you don’t owe the money, don’t throw in the towel.”  One of the attorneys in our firm is regularly asked to speak at provider conventions around the country.  For years, he has told providers “If it doesn’t belong to you, give it back.”  This simple concept covers a lot of ground when it comes to Medicare overpayments and is the single best policy you can employ as a good corporate citizen.

Recommendation #3 Don’t merely focus on your claims.  Are your business practices fully compliant with applicable laws and regulations?  Health Integrity and other ZPICs serve an essential role in identifying overpayments and other wrongdoing by health care providers. While an audit will almost always include a request for medical records, you should keep in mind that Health Integrity will not merely be examining your medical documentation.  Should you receive a request for documents, it will probably be broken into two major parts. The first section will likely be focused on business-related records such as the following: 

“Business contracts or agreements with other providers, suppliers, physicians, businesses or individuals in place during a specific period.  Additionally, any verbal agreements must be summarized in writing.

A listing of all current and former employees (employed during a specific period), along with their hire date, termination date, reason for leaving, title, qualifications, last known address, phone number.

  • A list of all practice locations, along with their address and phone number.
  • Leases.
  • Employment agreements.
  • Medical Director contracts.” 

One purpose of this section is to assist the ZPIC in identifying potential business practices which may constitute a violation of the Federal Anti-Kickback Statute, Stark Laws and / or the False Claims Act.  Should the ZPIC identify a possible violation, it will readily refer the case to CMS, HHS-OIG and / or DOJ, depending on the nature of the potential violation.

In contrast to the first section of the ZPIC’s request, the second section of the request will usually list the patient records and dates of service to be audited.  The number of dates of service audited differs from case to case.  Regardless of whether the ZPIC requests supporting documentation related to 5 claims or 50 claims, it is essential that you never ignore a request for information.  If additional time is needed to assemble the requested information, call the contractor.  Health Integrity has generally been cooperative with providers needing additional time to gather the records being requested.

Recommendation #4:  Remember learning how to “drive defensively” in high school?  Your documentation practices should be approached in a similar fashion.   When is the last time that you have reviewed the applicable documentation requirements set out in the Medicare Administrative Contractor’s latest Local Coverage Determination guidance covering the services you are providing?  Health Integrity’s auditors are excellent at identifying one or more deficiencies in your documentation. While you may disagree with the ultimate conclusions reached by their clinicians, you should not completely discount their assessments.  Health Integrity’s findings should be carefully analyzed so that any problems with your documentation can be promptly addressed.

Recommendation #5 Engage qualified legal counsel and clinical experts to assist with your efforts. If your home health agency is audited, we strongly recommend that you engage qualified legal counsel, with experience handling this specific type of case.  Moreover, don’t be afraid to ask for references and to inquire about the anticipated cost of an engagement.  While it is often difficult to estimate legal costs due to the various factors faced when handling a ZPIC audit case, most experienced health lawyers can give you a range of expected legal fees.

V.  Conclusion:

While an effective home health Compliance Plan cannot fully shield an organization from risk, the implementation of, and adherence to, an effective plan can greatly assist your home health agency in identifying weaknesses and taking corrective action before an audit occurs.  Now is the time to ensure that your practices are compliant – after an audit occurs, it may be too late.

Robert Liles Healthcare LawyerLiles Parker is a full service health law firm, providing compliance reviews, “gap analyses” and training to home health providers and their staff.  Our attorneys are also experienced in representing home health providers in the administrative appeal of overpayments identified in the post-payment audit process. Should you have any questions, please Robert W. Liles at 1 (800) 475-1906 for a free consultation.

Health Integrity Audits of Texas and Oklahoma Home Health Agencies are on the Rise.

August 15, 2011 by  
Filed under Home Health & Hospice

Health Integrity Audits of Texas Home Health Agencies are Expanding(August 14, 2011):   Home health agencies in Texas and Oklahoma remain under considerable scrutiny by Medicare contractors tasked with identifying fraud and abuse perpetrated against the Medicare Trust Fund.  As discussed below, these Medicare contractors have a number of tools at their disposal, many of which can effectively place a home health agency in financial peril in very little time whatsoever.  As our friend D.K. Everitt is fond of saying, “Compliance is not an Option.”  Now, more than ever, it is essential that you review both your past and current documentation, coding, billing and medical necessity practices to better ensure that your current practices fully comply with applicable statutory and regulatory requirements.

I.  Overview of the ZPIC Audit Program for Zone 4: 

Over last few years, the government’s reliance on private contractors to both identify overpayments and potential instances of fraud has greatly increased.  Health Integrity is the Zone Program Integrity Contractor (ZPIC) awarded the contract for Zone 4 (Texas, Oklahoma, Colorado and New Mexico) by the  Centers for Medicare and Medicaid Services (CMS).

II. Health Integrity Audits of Home Health Claims Are Accelerating: 

As home health agencies in Texas and Oklahoma can readily attest, Health Integrity audits of claims billed to Medicare have increased over the past year.  The Health Integrity audits may involve one or more of the following:

Unannounced site visits leading to probe samples, statistically relevant samples and other actions. Failure to cooperate can lead to revocation from the Medicare program.  Notably, there are no statutory restrictions preventing contractors from showing up unannounced and requesting to see documentation related to Medicare claims.  Should Health Integrity show up at your home health agency, you will likely find that Health Integrity’s auditors are both to-the-point and professional in their dealings you and your staff.  Our clients have generally found that Health Integrity’s reviewers have researched an agency’s billing practices before they arrive.  When they show up, they will already have a listing of the claims-related records to be pulled.   ZPICs have been known to show up with their own scanner or copier.  This has led to problems for providers later on because they failed to receive a copy from the contractor before they left.  Should a ZPIC ask you to make copies, the contractor will often identify a handful to take with them and ask that you forward the other within a set period.

Unannounced interview of home health patients and their families Health Integrity is actively conducting interviews of home health patients and their families in an effort to determine whether a patient was truly “homebound” during the claim period(s) at issue.

Pre-payment audit the number of home health agencies and other providers placed on pre-payment  review appears to have significantly increased over the last six months

Post-payment audit Health Integrity is actively conducting post-payment audits of Texas and Oklahoma home health agencies and are extrapolating alleged damages identified in these post-payment audits.

Suspension exercise caution when using Electronic Medical Records EMR) software – some software programs are better than others.  Avoid any program which minimizes the need for individualization and the documentation of patient-specific observations.  As always, it is important that home health agencies properly document the medical necessity of skilled care.  In some instances, ZPICs have expressed concern that the patient records generated appeared to be “cloned.”

Medicare number revocation take care if your home health agency is subjected to a site visit.  As a participating provider, you have an obligation to cooperate with the ZPIC’s review. Should you fail to cooperate, a ZPIC can recommend to CMS that your Medicare number be revoked. This is a very real threat and should not be discounted.  This becomes even more complicated if the ZPIC’s representatives go beyond mere claims-related questions and appear to be seeking information which could subject you (in your individual capacity), to possible civil and / or criminal liability.   Remember your obligations as a participating provider but call your attorney.  

Referral for criminal investigation and prosecution  — ZPICs are actively referring cases to HHS-OIG and DOJ for formal civil and criminal review.

III. Primary Reasons of Health Integrity Audits: 

We currently represent a number of home health agencies around the country in connection with post-payment audits and the appeal of overpayment assessments levied by Health Integrity and other ZPICs.  Our clients often ask why their home health agency was targeted by the ZPIC for audit.  After handling many of these cases, the following reasons for targeting have been cited by the ZPIC or ultimately learned when handling the case:

Predictive Modeling / Data Mining —  As Chapter 2, Sec. 2.3 of the MPIM details: “Claims date is the primary source of information to target abuse activities.”  Data mining may have been used to examine a home health agency’s “error rate.”  This would provide the provider’s history of repeated overpayments   or improperly filed claims.

Complaints  These can include “complaints” filed by beneficiaries, physicians, other providers (such as competitors), disgruntled current and former employees.

Referrals  ZPIC audits may be generated based on referrals from other CMS contractors (other ZPICs, PSCs, RACs, MACs, QA Staff), State MFCUs, Offices of the U.S. Attorney, or other Federal agencies.  Notably, it appears that private payors are now also referring cases to the government.

Reports —  HHS-OIG and GAO regularly issue reports addressing areas of concern.

State Licensing Boards State Medical Boards, Nursing Boards, Pharmacy Boards and other regulatory entities responsible for handling State licensing responsibilities regularly hear or learn of improper actions by providers.  This information may be shared with one or more Federal agencies and ultimately be referred to the ZPIC handling a certain zone.

IV.  Preparing for Health Integrity Audits: 

While many home health agencies believe that their Compliance Plan is satisfactory, it has been our observation that many of the plans currently in place are little more than copies taken from a sample off of the internet.  Unfortunately, many providers view Compliance Plans as mere paperwork, rather than as a useful “audit tool” to be used by the organization on an ongoing basis. When properly constructed, an effective Compliance Plan can both improve the quality of patient care rendered and assist a provider in its efforts to fully comply with applicable statutory and regulatory requirements.  Therefore, it is imperative that you take steps to ensure that your Compliance Plan takes into account each of the unique risks faced by your home health agency.

To be clear, although there are a number of steps you can take to reduce the likelihood of a ZPIC audit, there is no way to entirely eliminate the risk.  Nevertheless, the development, implementation and consistent application of an effective Compliance Plan can greatly reduce an organization’s potential liability.  In many respects, an effective Compliance Plan is similar to a flu shot.  Although a flu shot cannot prevent you from getting sick, it will hopefully reduce the severity of your illness should you catch the flu.  Similarly, if you have implemented and diligently adhered to an effective Compliance Plan, you could still be audited by a ZPIC, a Recovery Audit Contractor (RAC) or by a law enforcement agency, such as the Department of Health and Human Services, Office of Inspector General (HHS-OIG).  However, as a compliant home health agency, an auditor is much more likely to find that your billing practices comply with applicable coverage requirements.

Healthcare AttorneyRobert W. Liles serves as Managing Partner at Liles Parker, Attorneys & Counselors at Law.  Mr. Liles has extensive experience representing home health agencies and other providers in connection with the appeal of post-payment audits conducted by ZPICs and RACs.  Mr. Liles has conducted “gap analyses” of many provider organizations and has worked with these providers to implement effective Compliance Plans.  Should you find that your organization is being audited, feel free to call give him a call for a complimentary consultation.  He can be reached at: 1 (800) 475-1906.  

Texas Providers Should Expect Increase in Postpayment Audits of E/M Claims.

E/M Claims(March 8, 2011):  In February 2011, TrailBlazer Health Enterprises (TrailBlazer) reported the results of “widespread” probe reviews the contractor conducted of  CPT Codes 99211–99215 related to Evaluation and Management (E/M) claims billed for dates of service 01/01/10 through 06/30/10.  The frequency of E/M audits directed at Texas Medicare providers are increasing.  Is your practice properly documenting E/M claims?


I.  TrailBlazer’s Probe Review of E/M Claims:

The probe reviews conducted included the examination of 100 claims submitted by selected providers in Texas, Colorado, New Mexico and Oklahoma, along with 100 claims submitted by Virginia providers.  Overall, TrailBlazer found that most of the E/M claims billed should not have been paid.  In fact, the contractor found that very few of the E/M services billed to Medicare by Texas health care providers met the documentation requirements to qualify for coverage and payment.  As TrailBlazer’s report reflects:

The error rate for Texas / Colorado / New Mexico / Oklahoma health care providers was 91.32 %.

The error rate for Virginia health care providers was 51.43%.

II.  Types of E/M Claims Errors Found by TrailBlazer:

TrailBlazer found the following problems when evaluating the documentation supporting the E/M services at issue:

“Documentation did not support Medicare’s requirements for the Evaluation and Management (E/M) service to be considered medically reasonable and necessary: 

Inappropriate billing of an E/M service when only providing a non-covered service (e.g., acupuncture).

The chief complaint was absent, ambiguous or not addressed in the history, exam or Medical Decision-Making (MDM).

The chief complaint indicated the reason for the encounter was for administration of a medication, to have labs drawn or to receive the results for labs. None of these situations requires an E/M service.

In the absence of an acute problem, the frequency of E/M services billed per beneficiary for CPT codes 99212–99215 exceeded documented needs for management of stable, chronic conditions.

Documentation for the patient encounter did not provide a complete picture of the patient evaluation and management over time or the nature of the presenting problem. 

Documentation of an exam was absent from the patient’s medical record.

Documentation of MDM was absent from the patient’s medical record.

The requested documentation was not received.

The documentation did not support the use of the 25 modifier (no significant, separately identifiable E/M service was documented):

Documentation did not support a separate or any E/M services rendered.

Inappropriate billing of E/M services with physician attendance and supervision of hyperbaric oxygen therapy, intravenous infusions and various physical therapy services.”

In addition to these observations, TrailBlazer has outlined a number of other findings in its 02/08/11 report. 

III.  Recommendations for Texas Providers When Billing E/M Claims:

In light of TrailBlazer’s probe review findings, (91.23% error rate), the ZPIC assigned to this jurisdiction (Health Integrity) will likely be conducting widespread post-payment audits of Texas providers billing E/M services to Medicare.  It is imperative that Texas providers examine their E/M documentation practices to ensure that claims are being billed properly.

Additionally, providers billing E/M services to Medicare should examine their current Compliance Plans and verify that this issue is included as a “risk area” to be regularly reviewed by the practice or clinic.

Robert Liles Healthcare AttorneyRobert W. Liles, J.D., serves as Managing Partner at Liles Parker, Attorneys & Counselors at Law.  Liles Parker attorneys have extensive experience representing health care providers in connection with postpayment, E/M audits, and in compliance matters.  Should you have questions regarding these issues, give us a call for a complimentary consultation.  We can be reached at: 1 (800) 475-1906.