Inconsequential Medicare Audits Could Morph into a Whopper of a Whale

Original story posted on: February 5, 2020

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ED physicians and healthcare providers are a distinct breed – whales in a sea of fish.

After all, emergency room doctors have, for the most part, been overlooked by the Recovery Audit Contractor (RAC) auditors (or TPE, Targeted Probe-and-Educate; ZPICs, Zone Program Integrity Contractors; or Medicare Administrative Contractors, MACs).

Maybe it’s because even RAC auditors have children or spouses who need ER services from time to time. Maybe it’s because ER doctors use so many different billers. Normally, an ER doctor doesn’t know which of his or her patients are Medicaid or Medicare. When someone is suffering from a broken leg or heart attack, the ER doctor is not going to stop to inquire whether the patient is insured, and by whom.

But should they? Should ER doctors have to ask patients about their insurer? If the answer includes any sort of explanation that care differs depending on whether someone is covered by Medicare or Medicaid or has private insurance, then the answer may be yes.

ER doctors travel to separate emergency rooms, owned by various and distinct entities, and rely on individual billing companies. They do not normally work at only one hospital. Thus, they do not always have the same billers. We all know that not all billers are created equal. Some are endowed with a higher understanding of billing idiosyncrasies than others.

For example, for CPT codes 99281-99285, hospital emergency department services are not payable for the same calendar date as critical care services, when provided by the same physician or physician group with the same specialty, to the same patient. 

We all know that hospitals do not all implement the same billing computer software programs. The old adage – "you get what you pay for" – may be truer than we think. Recent articles have purported that the move to electronic health records may be contributing to billions of dollars in higher costs for Medicare, private insurers, and patients, by making it easier for hospitals and physicians to bill more for their services, whether or not they provide additional care. –Do you think a comment like that would red-flag ER doctors’ services by RAC, MAC, and ZPIC auditors? The white whale may as well shoot a water spray 30 feet into the air.

Will auditing entities begin to watch ER billing more closely? And if so, what are the consequences? When non-emergency healthcare providers are terminated by Medicare, Medicaid, or a MAC or MCO's network, there is no emergency, by definition. Juxtapose the need for ER healthcare providers. ER rooms cannot function with a shortage of physicians and providers. Even more disturbing is if the termination is unwarranted and seemingly inconsequential (only affecting under four surgeries per month, for example), but acts as the catalyst for termination of Medicare, Medicaid, and private payors across the board.

I have a client; say he’s named Dr. Ishmael. His big fish became the MAC Palmetto – very suddenly. Like many ER docs, he rotates ERs. He provides services for Medicare, Medicaid, private pay, uninsured – it doesn’t matter to him, he is an ER doctor. He gets a letter from one MAC. In this case, it was Palmetto. Interestingly enough, Palmetto is his smallest insurance payor. Maybe two surgeries a month are covered by Palmetto. Ninety percent of his services are provided to Medicaid patients, not by his choice, but by demographics and circumstance. The letter from Palmetto states that he is being excluded from Palmetto’s Medicare network, effective in 10 days. He will also be placed on the CMS preclusion list in four months.

We appeal through Palmetto, as required. But in the meantime, four other MACs, state Medicaid, and BCBS terminate Dr. Ishmael’s billing privileges for Medicare and Medicaid, based on Palmetto’s decision. Remember, we are appealing Palmetto’s decision, as we believe it is erroneous. But because of Palmetto’s possibly incorrect decision to terminate Dr. Ishmael’s Medicare billing privileges, all of a sudden, 100 percent of Dr. Ishmael’s services are unbillable and un-reimbursable ... without Dr. Ishmael or the hospital ever getting the opportunity to review and defend against the otherwise innocuous termination decision.

At this point, the hospital executives, along with legal counsel, schedule meetings with Dr. Ishmael. "They need him," they say. "He is important," they say. But he is not on the next month’s rotation. Or the next.

Billing audits on ER docs for Medicare/Medicaid compliance are distinctive processes, separate from other providers' audits. Most providers know the insurance of the patient to whom they are rendering services. Most providers use one biller and practice at one site. ER doctors have no control over the choice of their billers. Not to mention, the questions arises, who gets to appeal on behalf the ER provider? Doesn't the hospital reap the benefit of the reimbursements?

But one seemingly paltry (almost minnow-like) audit by a cameo auditor can disrupt an entire career for an ER doctor. It is imperative to act fast to appeal in such a case. But balance speed of the appeal with the importance of preparing all legal arguments. Most MACs or other auditing entities inform other payors quickly of your exclusion or termination, but require you to put forth all arguments in your appeal, or you could waive those defenses. I argue against that, but the allegations can exist, nonetheless.

The moral of the story is that ER doctors need to appeal, and appeal fast, when billing privileges are restricted, even if the particular payor only constitutes four surgeries a month. As Herman Melville said: "I know not all that may be coming, but be it what it will, I’ll go to it laughing." 

Sometimes, however, it is not a laughing matter. It is an appealable matter.

Programming Note:

Listen to Knicole Emanuel’s live reporting every Monday on Monitor Mondays, 10-10:30 a.m. EST.

Knicole C. Emanuel Esq.

Knicole C. Emanuel is a partner at the Potomac Law Group, PLLC.

For more than 16 years, Ms. Emanuel has maintained a litigation practice, concentrating on Medicare and Medicaid litigation, healthcare regulatory compliance, administrative law, and regulatory law. She understands the intricate Medicare and Medicaid payment system, the unique business of healthcare providers, the overlay of federal and state Medicare and Medicaid rules and regulations, and actions of state agencies that affect the way healthcare entities operate. She has tried over 1,000 administrative cases and has appeared before arbitration panels and in various appellate forums. Knicole is a member of the RACmonitor editorial board and a popular panelist on Monitor Monday.

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