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Recognizing Questionable Medical Billing Practices

By Beverly A. Hartin

Wednesday, July 25, 2001 | 1273 | 0 | min read

By: Beverly A. Hartin, President and CEO, Lien On Me, Inc./LOM Medical Bill Review

Anyone who has ever reviewed a medical bill for payment in the workers' compensation arena has, at some time, questioned with disbelief the charges on the page. The next thought usually is "Is this fraud or abuse?" and then, "what can be done to ensure the bill is paid fairly?"

Those responsible for bill payment must first be able to recognize the difference.
v Fraud is a felony, not easily proven and more difficult to prosecute. Two components are necessary. The perpetrator of the fraud: 1) must have knowingly lied about a fact that has an effect on the obtaining or denying of a benefit, AND 2) must have intent to deceive by use of the lie. A doctor reporting that there were never any previous injuries when you"ve got enough prior back claims on this employee to know his kids" first names by heart, may not be committing fraud if the instant-injury is an amputated finger. The misrepresentation of fact here would likely have no effect on the outcome of this worker"s benefits. Even if you could prove the physician knew about the priors, the first component in establishing fraud is absent.

The second component, "intent," is more difficult to discover. It"s much like looking at chads in the last presidential election. The best way to discern a provider"s intent is to identify a pattern of repeated similar offenses. For example, a search on a particular provider may show that referrals from a particular attorney result in a pattern of false medical history.Abuse in workers' compensation medical billing unfortunately is not only pervasive, the system rewards it by increasing fee schedule reimbursement levels based on the amounts billed.

Abuses can occur on two levels: 1) necessity for and, 2) reasonableness of the treatment.

Providers abuse the necessity clause of the employer"s responsibility to provide treatment when they over-treat or provide inappropriate treatment. The best remedy for this is strong case management through communication with the provider. This may be done at the examiner, nurse case manager, utilization review, or peer review level.

Determining the reasonable cost for billed services is best done through a reputable bill review vendor. The professional bill analyst is trained to identify: "upcoding" (using a higher reimbursement code than the one for the service actually provided); "unbundling" (charging separate codes for multiple services covered under a single code); "global fees" (charging for a follow-up visit when it"s included in the initial fee for service); charging full value for multiple surgeries; or supplies and materials not separately reimbursable (hot or cold packs, eye patches, steristrips, sterile gloves, etc.).

Whether or not you suspect fraud or an abuse, the tools to minimize financial impact on the employer or carrier are available. Recognition of the problem and access to the appropriate expert are key in eliminating both the short and long-term effects of these practices.

About the Author:
Beverly Hartin has nearly 25 years experience in all aspects of the workers' compensation claims arena from claims management to consulting services. Before founding Lien On Me, (a lien resolution service), and LOM Medical Bill Review, she managed and consulted for various large, respected industrial carriers in California. Mrs. Hartin, can be reached at bhartin@lienonmeinc.com


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