ED Coding and Reimbursement Alert

Make sure your compliance plan is ironclad to avoid these issues.

Health care auditors are increasing their reviews of medical practices nationwide, prompting emergency departments to remain vigilant and button up their documentation and recordkeeping. If you’d like some insight into the types of cases being prosecuted in this specialty, we’ve got the details of three ED-specific cases that were brought to light over the past few years which can help you determine what not to do if you’d like to avoid fraud.

1. Medically Unnecessary Admissions from the ED

A California-based physician is being accused of pressuring emergency department physicians at his facility to boost inpatient admission rates, even if the patients didn’t have a medically necessary reason to be admitted. In many cases, it was later determined that some patients could have been treated in the ED, the observation unit, or discharged, but were instead admitted, resulting in allegations of false claims submissions to government payers such as Medicare, according to a May 2016 news release about the case.

“Charging for medically unnecessary services, as alleged in this case, raises costs in government health programs and remorselessly passes that bill along to taxpayers,” said Special Agent in Charge Christian J. Schrank of the OIG. “Our investigation into the allegations in this case, along with our law enforcement partners, led to the government’s decision to intervene.”

The takeaway:  Your emergency department physicians are responsible for the medical decisions they make, so erroneously admitting patients who don’t have a medically necessary reason to be inpatients is problematic. Not only will it hurt insurers by overcharging them, but it isn’t a sound medical practice, as patients shouldn’t be treated for conditions they don’t have.

If you believe your hospital administrators are pressuring physicians to make medically unnecessary admissions, you must speak up. The case above was reported by a hospital employee. Your office’s compliance plan should dictate who to speak to if any infractions are found, and you should follow that plan in reporting the infractions.

Resource: For more on this case, visit https://www.justice.gov/opa/pr/united-states-intervenes-false-claims-act-lawsuit-against-prime-healthcare-services-inc-and.

2. Accepting Kickbacks for Unnecessary Prescriptions

An Arizona ED physician was arrested in October for his alleged role in a $100 million Tricare fraud case. The doctor faces a maximum 10-year sentence and a fine of up to $250,000 under the indictment, which involved one count of conspiracy to commit health care fraud. The doctor was alleged to have worked with 11 others as part of a scheme to prescribe compounded medications to Tricare patients in exchange for kickbacks.

The takeaway: In this case, the offending doctor would have easily been discovered if the practice had performed semiannual audits, so ensure that your practice is on an appropriate audit schedule to catch any such issues.

You can either perform a prospective audit (in which your practice examines new claims before you file them) or a retrospective audit (when your practice examines paid claims). A prospective audit helps you identify and correct problems before sending the claim, which could mean you’ll discover incorrect coding or charges that would otherwise have been missed. However, this type of chart audit can potentially delay billing.

Retrospective chart audits do not delay billing, but cause your office to be reactive by refiling claims, rather than proactive in finding problems before you submit the claims.

Best bet: Your practice must determine for itself what types of audits your staff can reasonably complete and what effects on claim submission timing and cash flow the practice can handle.

Resource: For more on this case, visit https://www.justice.gov/usao-ndtx/pr/ten-additional-defendants-charged-100-million-tricare-fraud-scheme.

3. Committing Stark Violations

A Texas medical center entered into a $21.75 million settlement with the government over allegations of False Claims Act violations. At issue was an allegation that the hospital “paid bonuses to emergency room physicians that improperly took into account the value of their cardiology referrals,” the government said in its news release about the case. “The United States contended that these agreements violated the Stark Statute and the False Claims Act.”

What’s the Stark Statute? The Stark law forbids physicians from referring Medicare patients for designated health services (DHS) to an entity with which the physician or an immediate family member has a financial relationship and prohibits the entity from submitting claims for those referred services.

The takeaway: When your ED physician makes a referral for a DHS, you should determine if the referral complies with your practice’s compliance plan as it relates to the Stark Law. If your clinician or any immediate family member does have a financial relationship with an entity that is providing DHS, then, as part of your plan, you should check if the arrangement fits into one of the Stark Law exceptions. If it fits, then you can refer Medicare patients to that entity for DHS with confidence; otherwise, you are risking violation of the Stark Law. If you are not sure if your referral is within the parameters of the Stark Law, seek legal help to avoidtrouble later.

Resource: To read more about the case, visit https://www.justice.gov/opa/pr/texas-based-citizens-medical-center-agrees-pay-united-states-2175-million-settle-alleged.