How Reliable Is Coding Advice?

By Peter Keohane, JD, MPH, CPC

If you accept coding advice, make sure that you confirm the advisor’s sources, since the practice is ultimately responsible for correct coding.

In 2001, the General Accounting Office (GAO) released its study of advice offered at coding seminars regarding proper coding and billing to Medicare. The GAO report, “Consultants’ Billing Advice May Lead to Improperly Paid Insurance Claims,” concluded that some of the tips given at the seminars were “inconsistent” with OIG guidance, and consequently “could result in violations of both civil and criminal statutes.” Although the report is six years old (and certainly not indicative of the industry as a whole), the bottom line is still the same: Listen to advice from others, but only trust what you’ve uncovered yourself.

This counsel also applies to advice offered from device suppliers and pharmaceutical representatives. Coders often tell me that a supplier or drug rep will offer tips on how to “get paid” for the supplies or drugs from Medicare and other payers. Reportedly, the reps will suggest submitting possible ICD-9-CM and/or CPT® codes to Medicare or other carriers based on what’s been paid in the past. They may also suggest methods in which a device or drug will be paid for “off-label” uses.

Coding Advice

As most readers undoubtedly know, inappropriate coding and billing of services is unethical and illegal.

For Medicare and other federal payer programs, this is a clear violation of the federal False Claims Act (FCA), which prohibits anyone from “knowingly present[ing] or cause[ing] to be presented a false or fraudulent claim” to the federal payer programs. It may also violate a state False Claims Act (FCA) statute (currently about 18 states have FCAs, and more are on the way) if the claim is with Medicaid.

In addition, every state has laws related to insurance fraud, which includes misrepresentations on a claim. Although pharmaceutical and medical supply reps are under increasing scrutiny for suggesting codes for payment, it is the provider (and by extension, the coding professional) who would be the target of an FCA violation, so be mindful of suggestions regarding which codes you should use. As always, selecting the most appropriate code should be based on the signs and symptoms or confirmed diagnoses of the patient and the most accurate description available of what services, procedures or supplies were performed or provided during the encounter. Reimbursement is not to be a consideration in code selection; if you are uncertain as to whether a service will be paid, Medicare has a solution for you: the Advance Beneficiary Notice (ABN). Use the ABN (or a similar document for non-Medicare patients) if there is uncertainty over coverage of the device or pharmaceutical.

“Off-label” Uses

Under current rules, federal health care programs may not pay for off-label uses of pharmaceuticals. For example, the Medicare Part D program restricts “covered drugs” to drugs prescribed for their FDA-approved indications or those uses that are supported by any of the three compendia. Similarly, the Medicaid statute permits states to restrict or exclude from coverage an otherwise covered outpatient drug if the drug is prescribed for a use other than that for which the FDA approved it or which is supported by citations in the American Hospital Formulary Service Drug Information, United States Pharmacopeia- Drug Information, or DRUGDEX Information system compendia.

As a result, the government recently has been focusing on False Claims Act liability against the pharmaceutical companies, as well as providers. In these cases, the government alleges that by promoting their drugs for off-label indications in violation of the federal food and drug laws, knowing and even intending that physicians will then prescribe those drugs to Medicare/Medicaid patients and knowing that the Medicare/Medicaid patients will seek reimbursement for the drugs by the government, the drug manufacturers violated the FCA by causing false claims to be submitted. In addition, of course, providers who are actually submitting those claims have also submitted a false claim.

In September 2005, the government announced the settlement of civil and criminal charges against the Swiss drug manufacturer Serono and several of its United States affiliates, involving kickback and offlabel promotion allegations relating to the promotion of Serostim®, a human growth hormone. Serono paid nearly $137 million in criminal fines in connection with the plea. The company also paid $567 million in the civil settlement of the qui tam cases that began the investigation.

Pharmaceutical sales representatives could also be held liable under the FCA (as well as state laws) for illegal sales tactics, including advice on getting paid for off-label uses. A TAP sales rep and seven other account and sales managers were recently tried in Boston on charges that they had conspired to get doctors to prescribe Lupron® in part by suggesting alternative uses for the drug.

Who is Ultimately Responsible?

It may be that the pharmaceutical or supply rep has suggested the most appropriate code; however, the burden for proper coding and billing falls on the practice — meaning the coding professionals and other staff who are involved in the claims process.

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