Anticipating expanding Medicare fraud investigations, physicians are wasting no time in strengthening their lines of defense.
Enforcement of healthcare fraud is at an all-time high--recent legislation has expanded investigators' reach into physician practices and increased their power to impose stiff penalties. The result: Medical associations and consultants are scrambling to provide fearful physicians with compliance plans.
Yet, in the midst of the confusion, more experienced voices are assuring physicians that it's relatively simple to avoid prosecution.
"You don't need additional staff; you can train the staff you have," says health law attorney and Medical Group Management Association consultant Alice Gosfield. "Good documentation is the key, and it's all relatively manageable if you're willing to pay attention."
Among the organizations that have been active in providing physicians with compliance guidance are the American College of Cardiology, American College of Surgeons, American Society of Internal Medicine, American College of Physicians and American Academy of Family Physicians. In addition, the American Medical Association and MGMA soon will publish compliance guidelines.
Fraudulent Medicare claims cost the federal government about $100 billion a year. In 1994, because of the scope of the problem, Attorney General Janet Reno declared that the investigation and prosecution of healthcare fraud would be a top priority at the Justice Department. Fraud investigations by the FBI more than tripled between 1992 and 1996, and criminal prosecutions increased to 246 from 83 during the same period. Investigations into civil healthcare fraud increased from 270 in fiscal 1992 to 2,488 in fiscal 1996, according to data from the National Health Lawyers Association/American Academy of Healthcare Attorneys.
In addition, qui tam, or whistle-blower cases, which allow private individuals to sue on behalf of the government, increased to 274 in 1995 from 33 in 1987.
More than $1 billion was recovered through whistle-blower cases between 1988 and 1995, according to the NHLA/AAHA.
Adding firepower to Reno's prosecution arsenal is the 1996 Health Insurance Portability and Accountability Act and this year's balanced-budget act. HIPAA increased civil money penalties for fraud by 500%, up to $10,000 per fraudulent item, plus triple the physician's original charge for services. HIPAA also has made healthcare fraud a criminal offense, punishable by up to 10 years in prison. Plus, the balanced-budget law includes a 10-year Medicare exclusion for repeat fraud offenders.
Clearly, the government is taking a "much more punitive approach," says Daniel Roach, associate general counsel at Allina Health Systems in Minneapolis and co-author of a new model compliance manual from NHLA/AAHA.
"(The governments is) no longer taking the approach that it's going to educate people if they make a mistake; instead, it's going to punish them," he says.
In short, physicians are finding themselves increasingly vulnerable. Under HIPAA, doctors may be liable for false claims regardless of whether they had an intent to defraud. And upcoding--billing with an inaccurate code--is now viewed as a false claim.
Because staying abreast of changes in evaluation and management codes is extremely difficult, many physicians regularly and unknowingly commit fraud, Gosfield says.
Paul Rogers, M.D., senior medical director of Clinical Care Associates of the University of Pennsylvania Health System in King of Prussia, calls coding "our greatest challenge."
Although his 260-physician clinic has a compliance department that can handle coding questions, he suggests physicians in smaller groups can manage coding by reviewing one another's files. "Once a month, each physician could review 10 files, put a code on the file and then look at the code that was actually used," he says.
The majority of physician fraud cases could be avoided with the sort of attention to detail that Rogers suggests, Roach says. In July, a Justice Department audit revealed that 45% of Medicare fraud cases were related to inadequate documentation or documentation that was completely missing, and 36% related to lack of medical necessity.
"Physicians need to understand documentation has become a necessary component of the practice of medicine," Roach says.
Assistant U.S. Attorney James Shee also recommends physicians do a simple audit: "Pull 25 Medicare and 25 private-pay files and have a nurse reviewer see if services billed were actually ordered. If there is a systemic problem you'll see it," he says.
An effective compliance program will have to examine more than billing procedures, Roach says. "Compliance is not a billing problem. When people think about compliance and fraud and abuse, they automatically equate it with billing," he says. "But the majority of problems with claims don't occur in the billing office, they occur in the claim development and submission process, with admission and registration, through patient care and coding and then, finally, in billing."
"Compliance is not something you layer on top of the organization; it's something you need to operationalize," he says.
Because fraud can occur in so many ways, ongoing education for all employees and physicians is essential, says health law attorney Paul Cooney. He is a partner with the Washington-based firm Foley, Lardner, Weissburg & Aronson.
"Pay attention to systems and procedures with a view toward being certain that each employee has the tools and education, the training, the software, etc., that he or she needs to do the job right," he says.