Making sense of Medicare audits

Published: 2011-05-16 10:12:48
Author: Jeff Brown, DC, CPC, CCPC

  As greater numbers of chiropractors capitalize on the benefits of the Health Information Technology for Economic and Clinical Health (HITECH) Act of 2009, they should also be aware that more Medicare audits are on the way. 

The push for additional audits is fueled by two studies conducted by the Office of Inspector General in 2004 and 2006, respectively. The studies revealed problems in how chiropractors and regional carriers that administer and pay Medicare claims are doing their jobs.

The studies found that many chiropractors were not documenting their claims properly, often not distinguishing between active treatments (code AT) and maintenance therapy (code GA). The carriers did not seem to notice; for the most part they paid, not seeming to realize that Medicare’s intent was to pay only for active treatment, not for maintenance.

As for the chiropractors’ intent? Whether carelessness, ignorance of the rules, or even fraud, it doesn’t matter: Audits are coming and doctors had better be prepared.

The 2004 study

The 2004 study sought to determine the vulnerabilities associated with Medicare payments for chiropractic services, to find their causes, and thus find ways to reduce them. In conducting the study, the agency selected a random sample of 400 Medicare services, with a total amount of $12,638.38 that had been submitted by chiropractors and allowed by regional carriers in 2001.

Their findings were threefold:

Accordingly, the agency issued two primary recommendations: that chiropractic services rendered comply with Medicare coverage criteria, and that carriers educate chiropractors on Medicare Carriers Manual requirements for supporting documentation. The recommendations were largely ignored, which precipitated the second study.

The 2006 study

Criteria for the second study were more directed and more detailed, analyzing four key factors:

The study reviewed a random sample of 188 claims to identify initial visits versus subsequent visits; whether each sample claim was for active/corrective treatment or maintenance therapy; the extent to which chiropractors supported their use of the AT modifier with proper documentation; whether claims were coded properly; and whether documentation met Manual requirements.

Four key findings emerged and were reported by the agency in 2009.

First, the extrapolated study revealed that of $178 million inappropriately paid for chiropractic claims — representing 47 percent of all claims studied — $147 million was for maintenance treatments. The balance went to miscoded claims ($11 million), undocumented claims ($46 million), and claims with multiple errors ($36 million).

Second, it showed that efforts to stop payment for maintenance therapy, by far the greatest of the improprieties, were largely ineffective.

Third, much of the claims data lacked initial visit dates for treatment episodes, making it difficult to identify maintenance therapy versus active treatment.

Finally, the study revealed that doctors still failed to comply with the CMS documentation requirements.

Again Medicare issued a set of recommendations, chief among which were the following: