medical billing transcription supplier information

Abstract: The consolidated

billing requirement of the Balanced Budget Act of 1997, which becomes effective on July 1, 1998, has catapulted postacute care providers into the arena of vulnerability for possible fraud and abuse. With this in mind, the postacute care providers must identify the implications and develop and implement a compliance program to prevent fraud, abuse and waste. [Nurs Manage 1998:29(5):16-18]

The Federal Bureau of Investigation (FBI) has made health care fraud its number two directive. According to Nancy Bradford of the National Association of Certified Fraud Examiners, efforts to combat fraud will continue to grow. Experts offer con servative estimates indicating that 3% of the $1 trillion health care costs ($30 billion) was lost to fraud in 1997. 1 Last year, the Department of Justice expected to recover more than $1 billion in fines and settlements, just from fraud against government health care programs.2

In the private sector, a survey done by the Health Insurance Association of America revealed that nine out of ten private insurers had launched antifraud programs since 1995. The savings enured from these private insurers' antifraud programs totaled $260 million; an average $2.3 million per insurer, and $7.50 savings for each dollar spent on fraud detection.3

Fraud and abuse trends

According to the FBI, the shift of illegal drug distributors to health care fraud is due to more money and less risk of injury, detection and prosecution. Total health care expenditure in the United States is expected to reach $1.2 trillion in 1998. This amount of money is very attractive to illegal drug dealers and others. As a case in point: a South Florida grand jury indicted two men on charges that they submitted more than $50 million in fraudulent health claims to private insurers and self-insured companies. One man has a prior federal conviction and the other has been previously convicted for narcotics trafficking. Today, both men remain fugitives.4

The "qui-tam" provisions of the False Claims Act (FCA) authorize private individuals to bring FCA actions on behalf of the government and share in any recovery, thereby giving even employees incentive to report any case of fraud and abuse. Per the Department of Justice figures in 1997, 5% of quitam cases involved the Department of Health and Human Services (DHHS).

A recent review done by the DHHS' Office of Inspector General (OIG), found that portable chest X-rays done in long-term-care facilities cost up to nine times more than nonportable chest X-rays. Moreover, the OIG also found after reviewing medical records in California, New York, Florida, Texas and Illinois, that there was "no indication in more than 50% of the beneficiaries' medical records that they would be unable to be transported outside of the nursing home for medical services." Consequently, OIG recommended that the Health Care Financing Administration (HCFA) enforce the Medicare requirement that a physician must justify the need for portable services. The result of such enforcement, according to the HCFA, would be [a savings on as much as $63.7 million per year and $371.9 million over 5 years.5

Recently, the Cambridge Information Services (CIS), a Massachusettsbased health care information research company, used data obtained from the HCFA and determined that U.S. hospitals may have overbilled Medicare for as much as $482 million for laboratory tests performed between 1990 and 1997. Consequently, CIS estimated that nationally the Department of Justice could potentially recover at least $750 million in overbillings and penalties.6

In the private sector, provider fraud falls into one of two categories: billing for services not rendered and upcoding. Examples of billing for services not rendered include a physician who spends just a moment with the patient but bills for a full evaluation; a podiatrist billing for foot surgery when he/she only trimmed toenails; or a therapist who bills for an hour of therapy with a patient, when in fact, it was for 15 minutes. In terms of upcoding fraud, a different code is used to maximize reimbursement for a service or procedure done instead of the specific code for such service or procedure. According to Greg Anderson, director of corporate finance investigations for Blue Cross-Blue Shield of Michigan, these types of fraud constitute 100% of the provider fraud in fee-for-service plans.7

In managed care, the incidence of fraud has been in terms of embezzling capitation funds, falsifying new enrollee registrations, falsely increasing encounter rates to increase future capitated payments, illegally balance-billing patients and overcharging for copayments. On the provider side in managed care, some physicians have under charged copayments in order to attract more patients, thereby increasing their capitated collection from the managed care company; have taken kickbacks in exchange for increased referrals to particular specialist or facilities; and have routinely admitted patients at 11:55 p.m. instead of 12:05 a.m., thus collecting for an extra day's stay.8

# posted by Medical Information : 3:09 AM