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I am sure that pun has been used before, but it fits too nicely to pass up.

My previous rant against the Medicare review coming up talked about the terror this whole process is instilling in physicians.  To understand why this is the case, the facts first need to be explained.

1.  The Process

This whole process is being done by groups known as Recovery Audit Contractors, or RAC.  These groups have bid for the right to “identify improper payments made on claims of health care services provided to Medicare beneficiaries.” (1)  They state that their job is to identify both over and underpayments made to providers, but they add: “They will focus on companies and individuals whose billings for Medicare services are higher than the majority of providers and suppliers in the community. ” (2)

Translation: They are really looking for overpayments.

To add to the mess is the fact that “The RACs will be paid on a contingency fee basis on both the overpayments and underpayments they find.” (2)

Translation: It is unlikely they will say “everything is OK” because they will not be paid if this is the case.

The demonstration project of this (done in six states) resulted in “over $900 million in overpayments and nearly $38 million in underpayments returned to health care providers. “ (2)

Translation: It is 30 times more likely that money will be taken than given back.

The mainstay of outpatient medicine (like my practice) is the office visit.  The office visit is reimbursed using E/M (Evaluation and Management) codes.  These codes are based on documentation, not care.  The demonstration project did not look at E/M codes, instead focusing on codes for procedures done and hospital charges.  The nationwide roll-out, however, will include E/M codes.  There is a bit of hope, however, based on the current information from Medicare:

…the review of all evaluation and management (E & M) services will be allowed under the RAC program. The review of duplicate claims or E & M services that should be included in a global surgery were available for review during the RAC demonstration and will continue to be available for review. The review of the level of the visit of some E & M services was not included in the RAC demonstration. CMS will work closely with the American Medical Association and the physician community prior to any reviews being completed regarding the level of the visit and will provide notice to the physician community before the RACs are allowed to begin reviews of evaluation and management (E & M) services and the level of the visit. (3) Emphasis mine.

Translation: Physicians like myself are in the cross-hairs, but the AMA has some power to mitigate this.  It must be noted, however, that the AMA is a specialty-heavy organization whose members will be hurt much more from the review of procedure codes than E/M.

So what’s wrong with fixing past errors?

I am sure that many outside of the medical field will take physician alarm over this as evidence that there is fraud and physicians are afraid of being caught.  While that certainly happens, physicians like myself (who don’t knowingly commit fraud) are also very nervous about the review.  Why?

The rules governing E/M coding are incredibly complicated.

A typical primary care physician has a seen a persistent reduction in reimbursement and so has had to increase patient volume to compensate.  Yes, while costs of medical care have skyrocketed, the average PCP is earning less per visit.  This gives less time for anything that does not generate revenue; and seeing patients generates revenue, while paperwork decreases it.

Here is the decision-making process physicians must go through to determine an E/M code:

So the average physician has a daunting task in determining what level of service to charge.  This has caused most doctors to under-charge to avoid risk in the case of an audit.

The vendors of Electronic Medical Records first pitched their products as a way to easily comply with E/M codes.  This is because E/M levels are based on documentation, and EMR allows quick documentation.  Our product has an “E/M Advisor” built in, which makes sure you are coding properly (if you use it).  Sounds like a perfect solution?  Not so fast:

Do not make the mistake of thinking you are exempt from reviews because you have an electronic medical record that does the coding for you. Reviewers are looking at these electronic records, or “templates”, that simply repeat from one patient to the next the same HPI, ROS and Exam. Some systems rely on the counting of elements and force you to document a complete review of systems when it may not be at all necessary. Additionally, read the electronic record after documenting, and make sure that what you say in the HPI is not “denied” in the ROS – auditors are particularly attuned to this problem.  (4) (J. Claypool and Associates)

Translation: Damned if you do, Damned if you don’t.  E/M coding requires far more coding than is actually useful to the physician.  It is simply a way to get paid for what you actually did.  So this mandated over-documentation is required, but must not be done easily (via template).

Final Translation

The complexity of E/M coding makes it almost 100% likely that any given physician will have billing not consistent with documentation.  Those who chronically undercoded (if they are still in business) are at less risk than those who coded properly.  Every patient encounter requires that physicians go through an incredibly complex set of requirements to be paid, and physicians like myself have improved our coding level through the use of an EMR.  This doesn’t necessarily imply we are over-documenting, it simply allows us to do the incredibly arduous task of complying with the rules necessary to be paid appropriately.

Have I ever willingly committed fraud?  No.

Am I confident that I have complied with the nightmarish paperwork necessary to appropriately bill all of my visits?  No way.

Am I scared?  You bet.  The RAC will find anything wrong with my coding that they can – they are paid more if they do.

A Plea

A very small percent of medical cost is spent in the office of the PCP.  Going on a witch hunt, or sending the Spanish Inquisition will bring some revenue back to Medicare, but at what cost?  Does the government really want to break the backs of the primary care physicians?  If this goes through, it certainly will break their backs.  And the system will fall apart when that happens.