The federal government is paying increasing attention to the "waste" aspect of its attack on waste, fraud and abuse in the Medicare program, and that could put physicians in the cross hairs.
The message was delivered at a conference for compliance officers in Washington last month. Top healthcare administrators, including HCFA Administrator Nancy-Ann Min DeParle, said sloppy coding and billing by physicians is just as serious an offense as deliberate fraud. And, they said, it is being taken just as seriously.
Medicare processes almost 900 million claims and pays about $210 billion in benefits annually. About 25% of Medicare payments go to physicians and other providers.
According to an HHS audit, about 7.1% of the $176.1 billion in Medicare fee-for-service payments in 1998 were improper, meaning Medicare was overbilled for $12.6 billion worth of services. Improper billing by physicians accounted for almost 26% of that amount.
The overall rate of 7.1% is down from 11%, or $20 billion, in 1997, due to stepped-up oversight and enforcement, and harsher penalties for violators.
But that is not enough, DeParle says. She points to simple errors often made by physician groups -- upcoding and billing for medically unnecessary procedures -- as two major problems HCFA will target in coming months.
Approximately $2.3 billion of the improper payments in 1998, or almost 18%, resulted from incorrect coding. Physician claims accounted for $1.5 billion of those improper payments. Billing for medically unnecessary procedures constituted $2.8 billion in improper payments, $400 million of which was attributed to physician claims.
Eliminating healthcare fraud is a top priority for the Clinton administration. In his 1999 State of the Union address, President Clinton announced an anti-fraud-and-abuse legislative package that aims to save Medicare $2.9 billion over five years. In the past two years alone, the federal government has collected more than $1.4 billion in fraud-and-abuse cases.
One component of the government arsenal is the Medicare Integrity Program, which identifies and investigates suspicious claims. Last month, DeParle unveiled that program's plan of attack.
Because most of the improper payments were uncovered by government-led medical record reviews, the plan calls for a 10% increase in the number of claims reviewed. In addition, the plan will require providers participating in Medicare to be more carefully and thoroughly screened.
In the future, providers will be subject to on-site visits to verify compliance with HCFA standards. To help weed out physicians who have committed fraud in the past, providers also will be required to submit their Social Security and Employer Identification numbers to HCFA.