Hospitals: Feds Share Blame for Billing Issues

Politico.com

September 27, 2012

A threat from Health and Human Services (HHS) and the Department of Justice to crack down on questionable Medicare billing has drawn a fairly strong rejoinder from two major hospital groups who say federal regulators deserve part of the blame.

The Association of Academic Health Centers (AAHC) sent a letter Tuesday to the HHS and DOJ, echoing complaints from the American Hospital Association (AHA) that the industry doesn’t have adequate guidelines on billing for some of the most common services. The hospitals said they had repeatedly asked for such information to no avail and that the problem has gotten worse with the proliferation of electronic health records.

“Those concerns have only been exacerbated by the increased uptake of electronic health records and the rapid changes in the delivery system necessary to accommodate more sophisticated technology,” AAHC President Steven Wartman wrote.

On Monday, the HHS and DOJ sent a letter to five major hospital groups, warning them not to use electronic health records to “game the system” and boost their revenues. The scathing HHS/DOJ letter came just days after a New York Times story analyzing Medicare data suggested hospitals and physicians were using electronic health records to illicitly pad federal reimbursement by exaggerating the scope of services they provided.

The Center for Public Integrity this month also published a detailed series on billing and “upcoding” that also examined the role of electronic health records and the related billing software.

Those stories added to questions about the value of the billions of dollars the Obama administration has sent to hospitals and providers to accelerate the use of health IT—all with the idea that technology would improve the quality of care while reducing administrative waste and duplication.

The AHA and AAHC also complained about Medicare Recovery Audit contractors, which the Centers for Medicare and Medicaid Services hire to review billings. The so-called recovery audit contractors have long been accused of being overzealous, in part because they are paid a percentage of improper payments that they identify, even if those payments are reduced or overturned on appeal.

“No one questions the need for auditors to identify billing mistakes, but the flood of new auditing programs, such as Recovery Audit Contractors, [Medicare Administrative Contractors] and others, is drowning hospitals with a deluge of redundant audits, unmanageable medical record requests and inappropriate payment denials,” AHA President Rich Umbdenstock wrote Monday night.

Other hospital groups held their fire in response to the Obama administration’s letter, which promised it wouldn’t be shy to flex its enforcement muscles to prosecute healthcare fraud.

The Association of American Medical Colleges, for instance, provided a statement that said its members have “robust compliance programs” and recommends the billing rules, written in the days of paper records, be revised to reflect the electronic age.

The National Association of Public Hospitals and Health Systems said it “shared” the government’s goal of achieving high-quality, affordable care and pledged its willingness to work alongside the administration, an offer made by the other groups.

“Our hospitals and health systems adhere to high ethical standards and reject practices that might result in fraudulent or other improper claims,” the NAPH statement reads. “We stand ready to help regulators understand fully the many aspects of electronic health record use in the hospital setting as they consider actions to ensure proper billing practices.”

The Federation of American Hospitals, which represents investor-owned hospitals, did not respond to a request for comment.