What Is Healthcare Billing Compliance?

The Importance of Proper Billing and Coding in Healthcare

Billing and coding are two of the primary ways healthcare providers such as doctors or hospitals can get in trouble. With the complexity of healthcare billing codes, mistakes are inevitable, which can cause problems such as under-billing, increased administrative costs to correct errors, and damaged professional relationships.

The Ramifications of Errors

A more serious problem occurs, however, when these errors trigger investigations of fraud. Whether the accusations come from private insurance carriers or from governmental programs like the Centers for Medicare & Medicaid (CMS), these simple mistakes could lead to severe penalties under the False Claims Act. Increasingly, these investigations can lead to criminal investigations and arrests for federal healthcare fraud.

The good news is that many of these mistakes are preventable. If a mistake still inevitably happens, it isn’t part of a larger pattern of abuse, so insurers are more likely to let you correct an error instead of filing charges.

The Scale of Healthcare Fraud

Medical billing is too complex, and too important, to take any chances. Each year, there is an estimated $400 billion of healthcare fraud. For this reason, there are a number of agencies aggressively pursuing and prosecuting these cases, including federal prosecutors, the Office of the Inspector General (OIG), the Department of Health and Human Services (HHS), the Medicare Fraud Strike Force, the Federal Bureau of Investigation (FBI), the Medicaid Fraud Control Unit, just to name a few.

These groups have specially trained federal investigators, outside investigative companies, and computer programs written to look for any “outliers.” These outliers show providers who have levels of billing outside the norm for their region and specialty, a high number of incorrect coding errors, or other red flags for fraud. For example, when comparing all doctors who perform hip replacement surgeries in Miami in a given year, are there a few doctors who consistently bill additional treatment outside the norm? Is there a pattern that could indicate bills are being padded, patients are receiving unnecessary treatment, or billing for work not even completed?

Types of Fraudulent Billing Charges

A few examples of fraudulent billing charges include:

• Billing for Services Not Provided – Billing for a procedure that wasn’t provided, or charging for a more expensive piece of equipment than was actually used.
• Billing for Medically Unnecessary Services – Performing services on patients that don’t meet the treatment criteria.
• Billing for Mutually Exclusive Services – Billing for two different procedures that can’t be performed simultaneously, or services that are medically impossible such as gender-exclusive procedures.
• Billing Unreasonably High Levels of Care (Upcoding) – Charging for more serious and expensive treatments than necessary.
• Billing for Services Not Covered – Billing insurer for services that are excluded under the policy.
• Failing to Collect Copays – Routinely waiving copays is considered fraud because it creates a false image of the actual service charges. For example, if your patient has a $20 copay, the insurance company pays $80 on a $100 charge. If you waive the copay, then the bill was actually only $80, not $100, and the insurance company should only pay $60.
• Billing for Out-of-Network Services – Submitting bills that aren’t qualified because the treatment is considered out-of-network.

Navigating the Landscape

For the healthcare provider, this high level of scrutiny means that you can’t make mistakes. You have to ensure that your business is organized and keeps accurate records to prevent violating the False Claims Act. Or at least that any small mistakes don’t end up looking like criminal fraudulent activity.

Call us today to learn how we can implement your billing and compliance protocols to protect you from mistakes that could lead to criminal investigations and prosecutions. Keep in mind that criminal and civil investigations of healthcare fraud carry significant penalties, including lengthy prison terms, loss of your medical license, CMS exclusion, and large monetary penalties, all meaning the end of your career at the very least. You need an experienced attorney to help you navigate the complicated world of medical billing so you can rest easy.