Feds 'listen' for sounds of Medicare billing abuse

Baltimore session looks at role of electronic health records in higher doctor and hospital fees

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Doctors, hospitals and insurance companies are making the switch to electronic health records.

Lucy Pemoni/Associated Press

When news broke last September that some doctors and hospitals could be using electronic health records to overbill Medicare, top government officials swung into action.

U.S. Health and Human Services Secretary Kathleen Sebelius and Attorney General Eric Holder fired off a stern letter to five prominent medical groups threatening criminal prosecution for applying the technology to bill for more complex and costly services than merited — a practice is known as “upcoding.”

But the Centers for Medicare and Medicaid Services, which reports to Sebelius, is taking a much less confrontational stance as it opens a “listening session” this morning in Baltimore on the digital billing controversy.

The agency has lined up nearly a dozen health industry speakers representing mostly hospitals, doctors and the software industry to give their take on fair and honest billing and coding standards to impose as medicine wires up. No one at the meeting will represent patients or others who pay medical bills.

A CMS spokesman called the meeting "another step toward ensuring appropriate use" of electronic records, which are "critical to our efforts to reform the health care delivery system, lowering costs while improving the quality of care.”

The initial reaction from Sebelius and Holder came on the heels of the Center for Public Integrity’s “Cracking the Codes”  series, a year-long investigation which showed that thousands of medical professionals billed sharply higher rates for treating seniors over the last decade — adding $11 billion or more to their fees. The findings suggested billing abuses could be worsening as doctors and hospitals switch from paper to electronic health records.

As the government has made good on plans to invest some $35 billion helping doctors and hospitals convert from paper to digital records, hundreds of technology firms have jumped into the market — often by promising doctors and hospitals that their gear can significantly boost the bottom line.

Most manufacturers and medical users contend the software merely allows them to more efficiently bill for their services, which in the past was often done by hand.

Critics argue, however, that with a flick of the wrist the devices can create a finely detailed medical file that’s often difficult for auditors to verify. Sebelius and Holder noted that in some cases, the machines can “cut and paste” information from previous doctor visits “in order to inflate what providers get paid.”

Sue Bowman, of the American Health Information Management Association, said her testimony in Baltimore would recommend research to figure out the precise role — if any — electronic records are playing in encouraging errant billing. “Like any tool (electronic health records) can help us be more efficient, but it can also be misused,” she said in an interview.

The Baltimore session takes place amid rumblings in Congress — at least among Republicans — that the multi-billion dollar initiative has veered off course.

Last month, six Republican U.S. Senators called for an overhaul of the plan, citing a range of concerns from patient privacy to stepped-up Medicare billing fraud.

Their report noted that many medical experts believe the digital systems can reduce health care costs and enhance medical quality by reducing wasteful testing and cutting down on harmful errors. But it also cited “troubling indications that some providers are using this technology to game the system, possibly to obtain payments to which they are not entitled.”

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