In May 2015, the U.S. Department of Health and Human Services Office of Inspector General (OIG) issued a report finding all claims for the provider under review failed to support medical necessity. OIG concluded virtually all payments the provider received were unallowable.
Why were all payments not identified as unallowable? OIG used a sample and then projected the results. The OIG used the lower limit of the confidence interval to be conservative. As a result, OIG identified only 96 percent of the paid Medicare dollars in error despite finding all submitted claims in error.
What services did the provider under review provide? Chiropractic services. The OIG report indicates “After analyzing Medicare claim data for [calendar year ] 2011, we selected multiple providers for review….” The OIG will have more to say on specific chiropractic providers in the coming months.
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Chiropractic Services Lead the Pack in Medicare Part B Fraud, Waste and Abuse
But what about chiropractic services generally? A quick look at The Supplementary Appendices for the Medicare Fee-for-Service 2014 Improper Payments Report shows the overall improper payment rate for chiropractic services was 54.1 percent. These same appendices for the 2013 report show an improper payment rate of 51.7 percent, and in 2012, the improper payment rate was 47.4 percent.
Are chiropractic services some sort of outlier? Not at all. In the 2014 appendices, chiropractic services do have the highest improper payment rate for Medicare Part B services. However, when all of Medicare is taken into consideration, chiropractic services falls to number 15. Manual wheelchairs have an improper payment rate of 84.6 percent, hospital beds have an improper payment rate of 82.0 percent, inpatient hospital services associated with chest pain have an improper payment rate of 75.2 percent, motorized wheelchairs have an improper payment rate of 74.6 percent, and diabetic shoes have an error rate of 67.7 percent.
Trained investigators could uncover improper payments relatively easily in the service types listed above. But despite the high improper payment rates, these service types make up a small percentage of the overall improper payments. For example, despite having the highest improper payment rate for Part B services, chiropractic services make up less than 3 percent of improper payments for Part B services.
Some other service types have much lower improper payment rates but account for a much greater share of improper payments. For example, office visits for established patients have an improper payment rate of 7.2 percent, but account for more than $1 billion in improper payments. As for Part A services, outpatient hospital services and skilled nursing facility inpatient services have improper payment rates of 7.7 percent and 7.0 percent respectively, but account for $3.4 billion and $2.4 billion in improper payments.
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Identifying improper payments when more than half of claims are improper? Easy. Identifying improper payments when 1 in 14 claims is improper? Not so easy. But these proverbial needles in the haystack are often where to find the big money.
That is where Integrity Management Services (IntegrityM) can help. We are expert at using data analytics to sort through thousands, or even millions, of claims to identify questionable ones. We can turn these quality leads over to your investigators, or one of our trained investigators can work the case.
To speak with an expert at IntegrityM, click here to contact us today, or call (703) 683-9600.