Putting E/M services on the RAC

In July, I posted about a report from the U.S. Department of Health & Human Services Office of the Inspector General (OIG) which found that from 2001 to 2010, physicians increased their billing of higher level evaluation and management (E/M) codes in all types of E/M services. In that post, I encouraged you to make sure that your documentation supports the level of E/M services that you are billing. With the OIG paying attention, the Centers for Medicare & Medicaid Services (CMS) were likely to follow suit, and you needed to be prepared.

Well, it appears that CMS was paying attention, or at least its recovery audit contractors (RACs) were. This week, CMS alerted the American Medical Association (AMA) that it has approved the Medicare Region C RAC. The contractor for Region C,  Connolly, is to begin conducting audits of coding for E/M services in physician offices, specifically CPT code 99215. According to the AMA, in the next several weeks Connolly will begin a complex medical review of code 99215 and will be permitted to extrapolate their findings based on a statistical sample of such claims. Connolly is the Medicare fee-for-service RAC contractor who conducts RAC audits in the following states:

• Ala.
• Ark.
• Colo.
• Fla.
• Ga.
• La.
• Miss.
• N.M.
• N.C.
• Okla.
• S.C.
• Tenn.
• Texas
• Va.
• W.Va.
• Puerto Rico
• U.S. Virgin Islands

However, it has not yet been announced if all or only a subset of these states and territories will be under review. As of this writing, Connolly has not posted this information and other details of the review on its website. These reviews are expected to begin imminently in Region C and, according to CMS, are likely to be approved in other Medicare regions in the near future. 

The American Academy of Family Physicians, the AMA, and 100 other state and specialty societies sent a letter to CMS in March 2009 strongly opposing RAC audits of E/M services. However, the OIG report apparently encouraged CMS, through its RAC auditors to do otherwise.

So, what's a family physician to do? I would argue that the advice given in my July post still applies:  make sure that your documentation supports the level of E/M services that you are billing to Medicare. If you are subjected to a RAC audit, take some solace in the fact that, according to CMS' FY 2010 Recovery Auditor Report to Congress, 46 percent of the Medicare RAC determinations that were appealed were decided in the provider's favor. That means you have almost a 50/50 chance of prevailing in the long run. Of course, as John Maynard Keynes once observed, "In the long run, we are all dead." Hopefully, the prospects for physicians in this case are a bit more optimistic.