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Welcome to the Industry: Know Your Role in Compliance

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  • July 1, 2020
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Welcome to the Industry: Know Your Role in Compliance

Medical coders play a part in preventing their organization from being accused of False Claims Act violations.

Being compliant in the healthcare arena means steering clear of government scrutiny and eliminating liability risk. Compliance takes on many forms; for example, physicians following Stark and Anti-kickback regulations, employees ensuring patients’ private health information is protected and secure using HIPAA safeguards, and healthcare workers safely handling biohazardous and infectious agents by following Occupational Safety and Health Administration (OSHA) standards. These are just a few compliance areas that healthcare industry employees must follow. There are many more, and some are more applicable to healthcare business professionals than others. The False Claims Act (FCA) is one of these compliance areas that coders are responsible for following.

As a professional coder submitting patient claims to payers, your medical coding expertise is needed to ensure your organization is submitting patient claims to payers in accordance with all coding and billing regulations, guidelines, and applicable state and federal laws. Let’s look at what a medical coder must know about compliance with the FCA.

What Is the False Claims Act?

Payment for healthcare claims is made or denied according to guidelines, rules, and federal laws that payers use to govern their role in the revenue cycle. The FCA imposes liability on “any person” who knowingly submits a false claim to the government for payment or who conspires to submit a false claim for payment. “Any person” includes medical coders, not just the physicians who receive the improper payment.

FCA 31 U.S.C. §§ 3729 says that anyone who violates the law “is liable to the United States Government for a civil penalty of not less than $5,000 and not more than $10,000, … plus 3 times the amount of damages.” Although the Department of Justice (DOJ) stopped adjusting most FCA penalties in 2018, the Commerce Department continues to increase the penalties for reverse false claims. In January 2020, the Commerce Department increased the reverse false claims penalties from $11,665 to $23,331 (Federal Register Vol. 85, No. 2, 15 CFR Part 6, Rules and Regulations). An example of a reverse false claim is when a hospital “obtains interim payments from Medicare throughout the year, and then knowingly files a false cost report at the end of the year in order to avoid making a refund to the Medicare program.” (31 U.S.C. §§ 3729-373)

The government sees reducing fraud and waste as a way to reduce healthcare costs. To tackle excessive government spending, federally funded compliance programs and investigations, such as Recovery Audit Contractors (RACs), Zone Program Integrity Contractors (ZPICs), and Medicaid Fraud Control Units (MFCUs), are tasked with scrutinizing claims, uncovering improper payments, and recouping overpayment.

What are these entities looking for? As a coder, that’s your job to know.

Compliance Checklist for Coders

Following so many coding rules and payer guidelines may seem daunting, but it’s not so bad when you put it down in a list. You can start by reading “One Dozen Practical Billing and Coding Compliance Tips,” by Mary Pat Whaley, FACMPE, CPC. You’ll be sure to learn lots of good rules of thumb for ensuring compliant coding. For example:

  • If it wasn’t documented, it wasn’t done. If it wasn’t done, don’t bill it.
  • If the service wasn’t medically necessary, it won’t be covered and shouldn’t be billed.
  • If the provider wasn’t there, their name won’t appear in the medical record or on the claim.
  • Don’t double bill the payer.
  • Don’t change the place of service to maximize payment.
  • Don’t unbundle services that are part of a single service or charge for related services during the global period.
  • Don’t up-code or down-code services.
  • Don’t discount care to patients for referring other patients.
  • If the patient or payer overpays, don’t keep the money.
  • If the payer denies payment based on a legitimate diagnosis, don’t change the diagnosis to achieve payment.
  • If money or gifts are offered to prescribe drugs, refer patients, or order procedures/tests, decline them.
  • If a test or procedure is needed, don’t direct patients to the facility in which you have a financial interest without disclosing that interest.

Be on the lookout for unbundling of codes that are bundled into one comprehensive code and ensure proper use of modifiers that can produce higher payments when used with certain codes. If you notice problems in documentation and there is a discrepancy in what is being coded and billed, or you receive a higher payment than the services rendered call for, you must bring it to a supervisor’s attention. Be sure to provide tangible official information when questioning or instructing another coding professional or a clinical professional on the appropriateness of coding or documentation. If you cannot establish guidelines, specifications, and/or legislation as validation, your inquiries won’t be taken seriously. Providing correct information consistently also shows ethics and integrity.

Compliance Tools and Software

For a quick lookup tool with a searchable database to find correct codes across medical code sets, look to AAPC Coder. It has an NCCI Edit tool that will point out code inconsistencies for accurate billing and with low denial rates.

If you want all-in-one compliance software and a compliance management solution to help ensure your organization will pass an audit, look to AAPC Audit Services.

AAPC Code of Ethics

To maintain consistency, your organization should implement a compliance plan and follow a code of ethics. AAPC members are expected to follow six ethical principles to help maintain compliant behavior and promote professionalism in the healthcare environment. The following is AAPC’s Code of Ethics statement.

It shall be the responsibility of every AAPC member, as a condition of continued membership, to conduct themselves in all professional activities in a manner consistent with ALL of the following ethical principles of professional conduct:

  • Integrity
  • Respect
  • Commitment
  • Competence
  • Fairness
  • Responsibility

Adherence to these ethical standards assists in assuring public confidence in the integrity and professionalism of AAPC members. Failure to conform professional conduct to these ethical standards, as determined by AAPC’s Ethics Committee, may result in the loss of membership with AAPC.

These six ethical principles are broken down in detail on the AAPC website. Please review them to gain a better explanation of your role as a healthcare business professional and the soft skills you need to promote a compliant and ethical work environment.

Surefire Resources for Compliance

You can easily find useful tools to help you attain your coding compliance goals. Here is a list of the official sources for ensuring compliant and accurate claims submission:

  • Code books – CPT®, ICD-10-CM and ICD-10-PCS, and HCPCS Level II code books are the gold standards for accurate code selection and appropriate modifier use. Be sure to refer to the official coding guidelines in each book.
  • Centers for Medicare & Medicaid Services (CMS) – When billing healthcare services for Medicare and Medicaid patients, go to the Regulations & Guidance page for access to the CMS Online Manual System, policy transmittals, executive orders, and compliance legislation.
  • Office of Inspector General (OIG) – The Compliance Resource Portal has tailored information to help your physician or healthcare organization comply with relevant federal healthcare laws and regulations. The portal contains OIG compliance plans, fraud alerts, videos, and toolkits.
  • National Correct Coding Initiative (NCCI) edits – These are the rules for payment methodologies and controls for improper coding that leads to inappropriate payment in Medicare Part B claims. They provide codes that are bundled into one payment and must not be billed separately.

Other important resources are commercial payers’ manuals, websites, and newsletters for guidance on their coding and reimbursement rules. And if your employer has not shared its compliance manuals and plans with you, ask if you can see them to make sure you are adhering to company policy.

Ramp Up Your Compliance Knowledge

Although the Certified Professional Coder (CPC®) credential ensures you know medical terminology and how to apply codes properly for compliant claims submission, there are two credentials that can take your compliance education to expert levels in your career: Certified Professional Medical Auditor (CPMA®) and Certified Professional Compliance Officer (CPCO™).

The CPMA® training prepares coders for an auditing role and gives you the know-how to assist and teach physicians and hospital staff about industry standards and requirements.

The CPCO™ credential solidifies expertise in compliance and how to implement an effective and successful compliance program. You’ll be able to troubleshoot fraud and abuse issues regarding unbundling National Correct Coding Initiative (NCCI) edits, false claims, federal Anti-Kickback Law and Stark Laws, HIPAA, Emergency Medical Treatment and Labor Act (EMTALA), OSHA, Clinical Laboratory Improvement Amendment, etc. CPCO™ training will give you the confidence to manage increased scrutiny of Medicare and Medicaid fraud and abuse to minimize risk at physician practices.


Cornell Law School, Legal Information Institute, 31 U.S. Code § 3729. False Claims

Federal Register, Rules and Regulations, Vol. 85, No. 2, 15 CFR Part 6 (page 208)

AAPC, Knowledge Center, “Be an Effective Coding Compliance Professional: Do You Have What It Takes?”

AAPC, Knowledge Center, “Align Your Credentials with Current Health Care Trends”

Michelle Dick
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Michelle A. Dick, BS, provides writing and editorial expertise to clients as a freelance content specialist. She is the owner of My Garden Gal, a garden maintenance and landscaping business. Prior to becoming a free agent, Dick was an executive editor for AAPC.

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