Uphold a Higher Standard: Report Fraud When Necessary

By Janalynne Thorley-Kilgo, CPC, CPC-I, CCS

Rotating coding staff or hiring new coders can be advantageous to a practice because it brings fresh eyes and a new perspective to stagnant coding routines. The downside is it can be difficult for new employees. New coders may find they are expected to code in a way they know is wrong or possibly fraudulent.

Certified Plastic and Reconstructive Surgery Coder CPRC

Eliminate Doubt

If you find yourself in a situation where you suspect fraudulent coding at your practice, first make sure you understand what you are being asked to do—you may be mistaken. When starting a new job, there is so much information being thrown at you that misunderstandings can easily arise. Before you take action, be clear on what is being done (or asked of you to do).

For example, you begin working for a plastic surgeon, and you are instructed to use the “complex” codes (13100-13160) for all laceration repairs. You ask your manager why and get the response, “Because the physician is a plastic surgeon, all his closures are complex; and that is the way they have always been billed.”

After you are clear on the coding issue, research your position.

  • Make sure you have read the code descriptors, guidelines, and references correctly.
  • Understand the appropriate coding.
  • Determine if a coding principle is being broken.

Seek True Codes

In the laceration repair coding example, turn to your CPT® code book for guidance. Look at the guidelines for complex repair that state, “includes the repair of wounds requiring more than layered closure, viz., scar revision, debridement, extensive undermining, stents or retention sutures.” Make a copy of the laceration repair note you are currently coding, and read through the note highlighting the wound size (2.5 cm) and location (right cheek), as well as the surgeon’s detail, “wound is clean and not very deep, edges are approximated with 5-0 nylon.” No mention is made of debridement or undermining. Now, you have your facts straight and supporting documents to reflect accurate coding.

In another example, you notice every encounter form with an annual physical is checked off to include a separate, billed office visit with modifier 25 Significant, separately identifiable evaluation and management service by the same physician on the same day of the procedure or other service appended. It strikes you as unusual that every patient seen for a physical would also have a significant, separately identifiable reason for the office visit code. With several such encounter forms on your desk, you take some time to look at the corresponding chart note for that service day.

Arm Yourself with Undisputable Evidence

Of the 10 reviewed charts, only two mention any condition other than an annual exam. At this point, you should make copies of the chart notes and the encounter forms. Research CPT® Assistant for any references to the correct use of modifier 25 and—because five of the notes were Medicare patients—you should also search the CMS Web site for articles and bulletins addressing the use of modifier 25. Finally, check the modifier 25 description from Appendix A of the CPT® code book. With this documentation on hand, you are ready to back up your claims in writing.

Write up a rationale explaining precisely why the current coding practice is wrong. Be sure to cite your references. It’s not enough to say, “This is how we did it where I worked before,” or “This is how I learned it in class.” Provide specific coding references from the CPT® or the ICD-9-CM code books, the AMA’s CPT® Assistant, CMS memoranda, or other authoritative sources. Keep your references readily available, either on paper or instantly accessible online.

When you are sure you have your facts ready, follow the steps outlined in the practice’s compliance plan. Not all offices have a compliance officer to whom you can address your concerns. If this is the case, approach your supervisor. Ask to meet with her to show her your documentation. In a small office, this could mean scheduling a meeting with the physician. It’s important to follow the chain of command in your particular setting.

Expect the Unexpected

Prepare yourself for unexpected results. You may have researched properly, met with the appropriate personnel, and even worked your way up to their supervisor or the physician, and your input still is disregarded.

If this is the case, refer to the American Academy of Professional Coders’ (AAPC) Code of Ethics for guidance:

Members of the AAPC shall be dedicated to providing the highest standard of professional coding and billing services to employers, clients, and patients. Professional and personal behavior of AAPC members must be exemplary.

  • AAPC members shall maintain the highest standard of personal and professional conduct. Members shall respect the rights of patients, clients, employers, and all other colleagues.
  • Members shall use only legal and ethical means in all professional dealings and shall refuse to cooperate with, or condone by silence, the actions of those who engage in fraudulent, deceptive, or illegal acts.
  • Members shall respect and adhere to the laws and regulations of the land and uphold the mission statement of the AAPC.

To adhere to the AAPC Code of Ethics, you will face the difficult decision of taking a stand for what is right—which could mean finding other employment. You will also face the ethical dilemma of whether to contact the Office of the Inspector General (OIG) and become the “whistle blower.” That idea makes most people cringe.

You may decide to only report it to the third-party payer it affects. Most payers have their own toll free hotlines. If the violations concern one of the federal health programs, you can call 1-800-447-8477. You can also report violations to the state medical board that oversees the providers in your state. Last but not least, you can report problems to your state’s Attorney General Office.

When reporting violations, be prepared to give as much detail as possible. For example:

  • Describe the exact fraudulent practice or act.
  • Give names of the individuals responsible, as well as their contact information.
  • Identify which payers are being defrauded.
  • Provide the estimated money value of the violations. If possible, indicate how often does the violation occurs, and the financial ramifications in each case.
  • Reveal, specifically, the information leading you to conclude violations were occurring.

The moral of this story is when you became a CPC®, you made a vow to uphold a higher standard. Nobody said it would be easy.

Janalynne Thorley-Kilgo, CPC, CPC-I, CCS, started in the field as a medical assistant, primarily for new physicians, where she hired and trained staff as the practice grew. Today, she is a coach and clinical editor at AAPC and also moonlights as a PMCC instructor. Janalynne focused on the clinical and coding duties and, after 15 years of working in an office setting, she acquired skills in outpatient surgery and inpatient hospital coding.


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