This article was first published in the Summer 2013 issue of New Retina MD, as the cover story.

Lawrence S. Halperin, MD: Many retina practices are receiving medical claim audits on a regular basis. Because a negative audit outcome can have a significant effect on a practice and because the increased scrutiny of retina claims increases the proportion of risk for retina practices, the editors of New Retina MD thought it would be helpful to readers to gather a panel of physicians and experts to discuss the issue.

Can you outline your experience with the audit process?

Michael X. Repka, MD: I am a pediatric ophthalmologist at the Wilmer Eye Institute at John Hopkins School of Medicine and the Medical Director for Governmental Affairs of the American Academy of Ophthalmology (AAO). My experience with claims audits comes from the physician organization and compliance perspective.

Trexler M. Topping, MD: I am President and Medical Director of Ophthalmic Consultants of Boston, which is a group of about 30 ophthalmologists and 10 optometrists. We are very active in practice management, and I am closely allied with all of the audits that are carried out in our practice. I also serve on the Health Policy Committee at the AAO and the board of the American Society of Retina Specialists (ASRS).

Stephen A. Kamenetzky, MD: am not currently practicing, but I previously was a comprehensive ophthalmologist. Currently, I am a consultant on the AAO's Health Policy Committee, the representative to the Centers for Medicare and Medicaid Services (CMS) and the American Medical Association (AMA) Relative Value Update Committee (RUC) Advisor for the AAO, and Co-chair of the AAO Coding Section. I am also a Medical Director of Anthem Blue Cross Blue Shield in Missouri.

Cherie L. McNett: I am the Director of Health Policy for the AAO, overseeing the reimbursement and Medicare regulatory policy at the federal level. I work with Dr. Repka, our AMA Current Procedural Terminology (CPT) advisor, and Dr. Kamenetzky on RUC-related activities.

RED FLAGS IN BILLING

Dr. Halperin: Ms. McNett, what retina coding and billing practices most commonly prompt audits?

Ms. McNett: In the past year, we have seen numerous audits that specifically target modifier 25 when appended to an Evaluation and Management (E&M) code. The CMS has very complicated rules regarding adding services to E&M codes, particularly when this is done with a minor procedure or in combination with other codes.

We have also seen many audits involving the use of anti-VEGF agents, and, more recently, we have seen several audits involving wrong retina diagnosis codes, particularly with billing for an injection when the diagnosis was dry age-related macular degeneration (AMD).

Dr. Halperin: Was the problem with how the diagnosis was linked? For example, with the electronic health record (EHR) that we use, we have to be careful because sometimes the code that the computer automatically generates is incorrect, so we have to double-check it.

Ms. McNett: I don't know that specifically. In the practice that I've been helping, it appears to have been incorrect billing.

Dr. Topping: In my practice, we don't have an EHR that pulls the billing charge out of the diagnosis that is entered; rather, the code must be input independently, so this has not been an issue for us. For practices with a system such as Dr. Halperin describes, double-checking the code is crucial because errors cannot be simply blamed on automation.

Dr. Kamenetzky: At Anthem Blue Cross Blue Shield, I review almost all of the eye care claim appeals. What impresses me the most is the carelessness that ophthalmologists show in picking a diagnosis code that matches the disease for which the drug is approved. For example, if the diagnosis is diabetic macular edema and the general code for macular edema is used, a claim for anti-VEGF medication approved only for diabetic macular edema may not be paid. If general codes are continually used for specific diagnoses for drug claims, the practice could face an audit.

WHAT TO DO WHEN AN AUDIT NOTICE IS RECEIVED

Dr. Halperin: When a practice receives notice of an audit, what are the first steps to take?

Ms. McNett: The date the letter was received should be logged and the deadlines noted and carefully followed. If there is any question about the requirements, you can always request a meeting with the medical director for that audit contractor. Even though this discussion will not stop the clock from ticking, it can improve clarity, and, in some cases, it can result in dismissal of the audit. The single most important thing, however, is to follow the timelines that are provided.

Dr. Kamenetzky: Do not alter the medical records. As bad as any situation might be, altering records will make it worse.

Dr. Halperin: It is crucial not to add or alter information in the medical record. It is better to add a cover letter stating that a mistake was made in not including all the details for a given date of service. The worst thing that will happen is that you won't get paid for that patient.

Dr. Topping: After the audit letter has been logged and put on file, all the pertinent case files must be collected. In our practice, we then have our compliance staff review every record in the file to evaluate what our level of exposure is. If the files look good, we are confident the audit will go well. If we find that our files look bad, we grit our teeth, send them to the auditor, and prepare for Armageddon. In the latter scenario, we will work with our entire staff to improve documentation for the future.

Dr. Kamenetzky: It is important to consider what will happen after a bad audit. The absolute worst scenario is a prison term. The next worst case is to be banned from the Medicare program, which is a big deal for an ophthalmologist. The best bad outcome is to have to pay money back. Most physicians would not have to worry about the prison scenario, but being banned from the Medicare program is a real possibility in a bad audit. In many cases, a settlement can be negotiated.

WHEN TO HIRE OUTSIDE HELP

Dr. Halperin: I know of a practice that has 6 recovery audit contractor (RAC) audits going on at the same time, all surrounding the use of anti-VEGF drugs. We all know that these audits are initiated to ensure that practices are not overbilling insurance, but why, as in the case of the practice to which I refer, are so many audits performed when they seem redundant?

Ms. McNett: RAC auditors are authorized to perform semiautomated reviews, in which they can plug massive amounts of claims into their computer systems and review them. The problem with the semiautomated reviews may be that the limits to the documentation requests do not apply to the reviews and do not follow the general rules of RAC audits with which most physician are familiar.

Dr. Repka: So why not just 1 big audit?

Ms. McNett: I believe that what happens is that, with the semiautomated reviews, a batch of documents is reviewed, and then, as more questionable claims come up, different requests must be made. The system does not have the ability to determine that the claims are all coming from 1 group, so the requests are sent as the questions are generated.

Dr. Kamenetzky: The RAC group is subject to its own set of rules. I would think that a practice that is in as deep as Dr. Halperin describes would have competent legal representation from a firm that is familiar with the RAC rules. This is not something a practice should try to do on its own.

Ms. McNett: CMS can grant all kinds of exceptions to RAC rules, but finding what these exceptions are can be difficult.

Dr. Kamenetzky: Are these exceptions for the auditor or the audited?

Ms. McNett: These exceptions are for the auditor.

Dr. Halperin: There have been many practices that have been audited on the use of ranibizumab (Lucentis, Genentech). The issue for the audit is whether 1 vial was used for 1 injection or for multiple injections. In some cases, the audit is completed, and the ruling will clear the practice, and then 2 weeks later the practice is notified of another audit for the same thing. What are predictors of a situation like this?

Ms. McNett: I do not know if a practice can predict this because every audit is different. In the instance that you just described, it sounds like the first incidence was not an audit per se, but rather a fact-finding exercise that turned into a real RAC audit. In general, ophthalmology is a target because it was identified in the last Office of the Inspector General (OIG) work plan as a specialty for which services needed to be reviewed. In my opinion, I do not think this is coincidental in light of the increase in RAC audits.

Dr. Halperin: Why do you think that the OIG felt that ophthalmology was in need of greater scrutiny?

Dr. Kamenetzky: The OIG is concerned about our billing habits. In the case of ranibizumab, payment is structured on a single vial for a single patient. If a physician administers 4 injections out of the same vial, the cost of the drug per injection is reduced by 75%, and the payment per injection remains the same. That's what CMS is looking for. The dollar volume of ranibizumab in the Medicare payment structure is higher than most drugs that are covered, so it is a natural target.

Dr. Halperin: In general terms, when should a practice handle an audit on its own vs obtaining outside help?

Dr. Kamenetzky: I don't think a practice that has little experience in this area should try to handle any audit on its own in most situations because the cost of proper representation will be less than the cost of becoming immersed in a situation that is poorly understood. This is my personal opinion, not that of the AAO. My advice would be to involve a health care attorney who is well versed in the RAC rules from the very beginning.

Ms. McNett: I think it depends on the audit. I have helped many practices with varying levels of RAC requests, and there are some audits that request 10 to 13 records vs those that request hundreds. It's at the high end of requests where I think an attorney is necessary.

Dr. Topping: We have been audited many times, and most of those could be handled in house. We are seeing a change in the audits from private insurers in that, instead of asking for the records for a patient for 1 date, they are asking for records for an entire year. I think this is interesting because there is a possibility that the insurer is looking for a “copy-and-paste" pattern in medical records, where visits look too similar.

Before we send out billing information to insurance, we review the record to ensure that there is justification for the use of modifier 25. If we do not have sufficient documentation, we delete the E&M visit that was being billed in addition to the injection code. It is infrequent that we are audited for these records, but when we have been audited, all of them have passed. Fortunately, we have not yet been deluged with a 100-chart audit and have not had the need to hire legal counsel, but I do not doubt that this will happen.

Ms. McNett: If practices spent more time reviewing charts before billing insurance, this would eliminate some of the risk of being audited.

TYPES OF AUDITS

Dr. Halperin: Can we review the types of audits that are out there and how they differ?

Ms. McNett: There are Medicare Administrative Contractor (MAC) audits, which are generated in the case of discrepancies in Part A and B claims and services. Comprehensive Error Rate Testing (CERT) is not necessarily an audit of a practice but rather an audit of a contractor to improve error rates. CERT alerts tend to be a good gauge of future targets of RAC and MAC audits.

Zone Program Integrity Contractors (ZPIC) audits specifically target fraud. These are relatively uncommon in ophthalmology because ophthalmologists do not bill frequently to Medicaid.

Dr. Topping: We are frequently audited from private insurance companies. Can you comment on these types of audits?

Ms. McNett: Every private insurer can have its own audit program, so I do not deal with these frequently.

Dr. Kamenetzky: Most private insurer audits are based on billing patterns for services such as imaging that are outliers when compared with other ophthalmologists. The rules for the audit process are the same as with RAC and MAC audits.

SUMMARY

Dr. Topping: Because ophthalmology has a number of subspecialties that are not clearly separated from one another in a database, retina specialists and other subspecialists may be at a disadvantage. For example, a retina specialist who is performing a large number of fluorescein angiograms will automatically fall off the bell curve and be considered an outlier for performing too many angiograms, and a glaucoma specialist who is performing a high volume of laser peripheral iridotomies or tube shunt procedures will fall off the other end of the bell curve.

Dr. Halperin: Retina specifically is facing more audits due to the expensive medications that we use and the frequency with which they are dosed. I think we all agree that a solid knowledge of proper coding and careful documentation is crucial to lowering your practice risk for an audit. It is possible that, no matter how diligently you and your staff follow these rules, an audit will be carried out, simply because of what Dr. Topping said-retina specialists automatically fall off the curve of “normal" ophthalmology practice in the eyes of insurers. However, it is up to us to take the important steps to ensure that our records are clear and support best practices.

Lawrence S. Halperin, MD, is in private practice at the Retina Group of Florida. He is also Clinical Associate Professor at the Charles E. Schmidt College of Medicine, Florida Atlantic University. He is a member of the board of directors of the ASRS, chair of the Retina Advocacy and Federal Affairs Committee, and serves on the Practice Management Committee for the ASRS. He may be reached at lhalperin@mac.com. 

Stephen A. Kamenetzky, MD, is a member of the AAO Relative Value Scale Update Committee. He is a Medical Director for Anthem Blue Cross Blue Shield and was on the board of directors and Treasurer of Ophthalmic Mutual Insurance Company. He may be reached at kamen1@mindspring.com .

Cherie L. McNett is Director of Health Policy at the AAO. She may be reached atcmcnett@aaodc.com.

Michael X. Repka, MD, is Vice Chair for Clinical Practice and Professor of Ophthalmology & Pediatrics in the Division of Pediatric Ophthalmology & Adult Strabismus at The Wilmer Eye Institute, The Johns Hopkins School of Medicine in Baltimore. He is also Medical Director for Governmental Affairs at the AAO. He may be reached at mrepka@jhmi.edu.

Trexler M. Topping, MD, practices at Ophthalmic Consultants of Boston and Boston Eye Surgery & Laser Center. He serves on the Health Policy Committee at the AAO and the board of the ASRS. He may be reached at +1 617 367 4800.