Medicare Overpaid Physicians $6.7B For Miscoded Claims

Cheryl Clark, for HealthLeaders Media , May 30, 2014

An examination of medical claims records by federal officials finds that more than half of doctors' claims for patient evaluations and related services had incorrect codes or lacked the necessary documentation.

Suggesting physician upcoding practices on a major scale, an Office of Inspector General report Thursday said Medicare overpaid physicians $6.7 billion in 2010.

The overpayments were claims reimbursements for evaluation and management (E/M) services submitted with frequently exaggerated severity codes, the report said.

After examining medical records for a large sample of those claims, the OIG found that 26% of the claims were upcoded to reflect a higher level of severity than what was justified by the patient's record, amounting to $4.6 billion in overpayments. Another 14.5% were downcoded, reflecting a lower level of severity than what was warranted, for an underpayment of $1.8 billion.

Another 12% of the claims were insufficiently documented, which meant Medicare overpaid $2.6 billion and 7% were undocumented, representing $2 billion in overpayments. About 2% of claims had other coding errors, amounting to about $500 million in overpayments.

In all, 55% of claims for E/M services had incorrect codes or lacked the necessary documentation.

Medicare paid $32.3 billion for E/M services in 2010, an amount that represented 30% of all Part B payments that year.

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2 comments on "Medicare Overpaid Physicians $6.7B For Miscoded Claims"

Susan M. Campbell (6/2/2014 at 8:03 PM)
Good comment!! This article is just 1 argument for having Certified Professional Coders on staff!!! So many medical offices, hospitalists' offices, etc. will hire Anyone....and I mean anyone to perform coding/data entry.

Joe Taxpayer (5/30/2014 at 10:43 AM)
CMS said, it would "analyze each overpayment to determine which claims exceed CMS recovery threshold and can be collected consistent with agency's policies and procedures." Right: "Bureaucracy defends the status quo long past the time when the quo has lost its status." Laurence J. Peter IMHO; providers should be reminded that as per ACA Section 6402, they are supposed to return overpayments and notify the Federal Program(s) of the payment mistakes. CMS' recovery practices are too old and cumversome. It's time to follow the provisions promulgated by the HIPAA Administrative Simplification provision. Get with it CMS and use our tax dollars correctly!




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