Lessons from OIG Audits of Physician E/M Services (Part 3)

Welcome to part three of this three-part series where I discuss six important lessons we can all learn from the OIG’s audits of physician E/M services. These six lessons can help you ensure that your claims are sufficiently documented and protect your organization from improper payments. And now, for the final lesson...

New to the series? Check out Part 1 and Part 2.

Lesson #6 – OIG Audit Identified “High-Coding” Physicians

High-coding physicians are defined as:

1. Physicians whose average code level was in the top 1% of their specialty
2. Physicians that billed for the two highest level codes for E/M services at least 95% of the time

Claims for E/M services billed for by high-coding physicians were more likely to be incorrectly coded than those billed for by other physicians.

• A total of 56% of claims for E/M services billed for by high-coding physicians in 2010 were incorrectly coded.
• Medicare inappropriately paid $26 million for these claims, representing 25% of total Medicare payments for E/M services billed for by high-coding physicians in 2010.
• Medicare inappropriately paid an average of $15,594 per high-coding physician in 2010 for incorrectly coded claims for E/M services.
• A total of 99% of miscoded claims for E/M services billed for by high-coding physicians in 2010 were upcoded, while less than 1 percent were downcoded.

Claim details for other physicians which are not referred to as “high-coding” are as follows:

• Forty-two percent of claims for E/M services billed for by other physicians were incorrectly coded.
• Medicare inappropriately paid $3.2 billion for these claims, representing 10% of total Medicare payments for E/M services billed for by other physicians in 2010.
• Medicare inappropriately paid an average of $7,348 per other physician in 2010 for incorrectly coded claims for E/M services.
• A total of 64% of miscoded claims for E/M services billed for by other physicians in 2010 were upcoded, while 36% were downcoded.

Additionally, claims for E/M services billed for by high-coding physicians were more likely to be insufficiently documented than those billed for by other physicians.

• A total of 20% of claims for E/M services billed for by high-coding physicians were insufficiently documented, compared to 12% of those billed for by other physicians.

Conclusion

Even though Medicare payment rates for individual E/M services are small (about $100 on average), 370 million E/M services were billed for by physicians in 2010 and accounted for nearly 30% ($32.3 billion of $110 billion) of Part B payments that year.

The OIG findings highlight multiple areas of need and focus such as:

• Continued education of physicians and coding staff for documentation requirements of E/M services
• Review current education material and revise and update as necessary
• Internal audit focus should include new OIG-determined “high-coding” physician category
• Determine need for external audit help and tools to enhance practice compliance and appropriate reimbursement

Unless otherwise noted source material for this blog is from the OIG “Improper Payments for Evaluation and Management Services Cost Medicare Billions in 2010” report dated May 2014.

For more information, download our free eBrief, Is The OIG Looking At Your E/M Services.