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Effective Compliance Plans for Physicians Part I Print E-mail
Written by Ben Frosch   
Saturday, 24 March 2012 16:16

Part I: Why Do Physician Practices Need Effective Compliance Plans?

As a result of the Affordable Care Act, the health insurance reform legislation, there can no longer be any doubt that the Department of Health and Human Services - Office Inspector General ("OIG") strongly encourages, indeed expects, every physician, supplier and provider participating in the Medicare and Medicaid programs to develop, implement, and maintain an effective corporate compliance plan that is designed to reduce the likelihood of fraudulent or abusive billing and other activities. OIG physician compliance education materials disseminated in 2011 indicate that the Centers for Medicare and Medicaid services (CMS) has not finalized the requirements, but will advance specific proposals at some point, and soon compliance plans will be mandatory. Over a decade ago, the OIG issued the draft "Compliance Program for Individual and Small Group Physician Practices" ("Physician Guidelines"), which outlines the steps the government expects individual practitioners and small group practices to take. The OIG has indicated that the presence or absence of an effective compliance plan is likely to be a significant factor in reaching its decision to prosecute or agree to otherwise resolve an allegation of abuse or criminal activity involving a provider of health care services.

The OIG is requiring providers who are found to be out of compliance with the fraud and abuse laws, for example, by failing to conform to the billing and coding requirements, to establish compliance plans as part of their Corporate Integrity Agreements. In being proactive and voluntarily adopting an effective compliance plan before being required to do so, a provider has the opportunity to better control both the cost of its plan and the plan's implementation. By proactively implementing an effective compliance plan, a physician's practice also creates for itself an opportunity to implement measures designed, for example, to improve the accuracy of the practice's billing, and correct any systemic weaknesses that could lead to erroneous or false claims, and establish effective controls, for detecting, correcting and preventing future billing problems. In short, by implementing an effective compliance plan a provider can reduce substantially the risk of OIG scrutiny. 

Mr. Frosch is the President of Frosch Medical Consultants in Plantation, FL.

Last Updated on Tuesday, 03 April 2012 06:31
2012 Office of Inspector General (OIG) Work Plan Medicare Part B Print E-mail
Written by Benjamin L. Frosch   
Saturday, 21 January 2012 15:18

ben frosch
With the passage the Affordable Health Care Act (Health Care Reform) and the Medicare program in financial jeopardy, the OIG 2012 Work Plan is possibly more important than any of their previous work plans. With a few thousand staff members throughout the United States, the Office of Inspector General (OIG) plans and performs audits, investigations, evaluations, and legal activities pertaining to the Department of Health and Human Services (HHS). With the Issuance of the 2012 OIG Work Plan, there are a variety of important Medicare issues that they will evaluate pertaining to Medicare physicians and other healthcare providers. This may be a good opportunity to evaluate compliance in your practice with respect to the following Part B subjects that are in the OIG Work Plan.   With more federal agencies taking a closer look at Medicare fraud and abuse than ever before, it is very clear that there is a zero tolerance for Medicare fraud and abuse.   The following is a list of what I think are some of the hottest physician subjects targeted in the 2012 OIG Work Plan.


This is going to be a subject under the microscope in 2012 and beyond. The OIG will be identifying providers that exhibit questionable billing for E/M services in 2009.  Medicare paid $32 Billion dollars for E&M services in 2009, representing 19% of all Medicare Part B payments. Providers are responsible for ensuring that the E/M codes that they submit accurately reflect the services they provide and were medically necessary. E/M codes represent the type, setting, and complexity of services of provided and the patient status, such as new or established.

The OIG has and will continue to review physician coding on Medicare Part B claims for services performed in Ambulatory Surgical Centers (ASC) and hospital out-patient departments to determine whether they are coded properly with the correct place of service. Federal regulations provide for different levels of payments to physicians depending on where services are performed. Medicare pays a physician a higher amount when a service is performed in a non-facility setting, such as a physician office, than it does when a service is performed in hospital outpatient department or, with certain exceptions, in an Ambulatory Surgical Center.  

The OIG will continue to evaluate Medicare payments for Part B imaging services to determine whether they reflect the expenses incurred and whether the utilization rates reflect industry practices. Physicians are paid for services pursuant to the Medicare Fee Schedule, which covers the major categories of cost, including the physician professional cost component, malpractice cost, and practice expenses.   Practice expenses are those such as office rent, wages of personnel, and equipment.   For selected imaging services, the OIG will focus on the practice expense components, including the equipment utilization rate. From the 2011 Work Plan, the OIG will continue to review Medicare payments for high cost diagnostic tests to determine whether the tests were medically necessary. The Social Security Act provides that Medicare will not pay for items or services that are not "not reasonable and necessary".

The OIG will review the appropriateness of the use of certain claims modifier codes during the global surgery period and determine whether Medicare payments for claims with modifiers used during the global surgery period were in accordance with Medicare requirements. Prior OIG work has shown that improper use of modifiers during the global surgery period resulted in inappropriate payments. The global surgery payment includes a surgical service and related preoperative and postoperative E/M services provided during the global surgery period.

Physicians: Incident-To Services
CMS and the OIG have always been concerned about proper use of the "incident-to" provision. Therefore, the OIG will review physician billing for "incident-to" services to determine whether payment for such services had a higher error rate than that for non-incident-to services. Additionally, they will assess CMS's ability to monitor services billed as "incident-to." Medicare Part B pays for certain services billed by physicians that are performed by non-physicians incident to a physician office visit. In 2009 the OIG found that when Medicare allowed physicians' billings for more than 24 hours of services in a day, half of the services were not performed by a physician. They also found that unqualified non-physicians performed 21 percent of the services that physicians did not perform personally.

Incident-to services represent a program vulnerability to CMS in that they do not appear in claims data and can be identified only by reviewing the medical records.  Medicare may also be vulnerable to overutilization and expose a Medicare beneficiary to care that does not meet professional standards of quality.                          (ARTICLE CONTINUES BELOW)

Last Updated on Monday, 30 January 2012 09:53
2012 Office of Inspector General (OIG) Work Plan Medicare Part B (continued) Print E-mail
Written by Benjamin L. Frosch   
Saturday, 21 January 2012 15:13

Sleep Testing
The OIG will take a closer look at the appropriateness of Medicare payments for sleep test procedures provided at sleep disorder clinics and determine whether they were in accordance with Medicare regulations and guidelines. A preliminary review by the OIG identified improper payments when certain modifiers codes are not reported with sleep test procedures. Therefore, the OIG will examine Medicare payments to physicians and Independent Diagnostic Testing Facilities (IDTF's) for sleep test procedures.

Outpatient Physical Therapy Services
The OIG will review outpatient physical therapy services provided by independent therapists to determine whether they were in compliance with Medicare reimbursement regulations. In the past, the OIG has identified claims for therapy services provided by independent physical therapists that were not, medically reasonable and necessary, or properly documented. They will focus on independent therapists who have a high utilization rate for outpatient physical therapy services because of their concern that they may not be medically reasonable and necessary.

Clinical Laboratories Services

The OIG will take a look at and review trends in laboratory utilization under Medicare, such as in the types of laboratory tests and the number of tests ordered. They will examine how physician specialty, diagnosis, and geographic differences in the practice of medicine affect physicians' laboratory test ordering. In 2008, Medicare paid about $7 billion for clinical laboratory services, which represents a 92 percent increase from 1998. It is believed that much of the growth in laboratory spending was the result of increased volume of ordered tests.

Physicians and Other Suppliers: High Cumulative Part B Payments
The OIG will be reviewing payment systems controls that identify high cumulative Medicare Part B payments to physicians and other providers. The OIG will evaluate whether payment system controls are in place to identify such payments and assess the effectiveness of those controls.

Medicare Part B services must be reasonable and necessary in accordance with the Social Security Act. A high cumulative payment is an unusually high payment made to an individual physician or provider, or on behalf of an individual beneficiary, over a specified period. The OIG is concerned that unusually high Medicare payments may indicate incorrect billing or fraud and abuse.

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Mr. Frosch is the President of Frosch Medical Consultants in Plantation, Florida.  He is a frequent contributor to FHIweekly and Specialty Focus. 
Last Updated on Saturday, 21 January 2012 16:08
ASK BEN: Medicare Q & A December 2011 Update Print E-mail
Written by Benjamin L. Frosch   
Monday, 02 January 2012 00:00

Q:  I recently completed my fellowship and will be setting up my own solo practice next month.  I wish to set up a P.A. (Professional Association) and am confused about which documents to submit.  Do I need to submit a separate CMS 855B to get a provider number for my P.A. and then obtain a personal number by completing a CMS 855I and CMS 855R reassigning my personal benefits to my P.A.  Are all of these documents necessary? 

New Physician
Orlando, FL  

A:  Since you are the sole owner and only member of your Professional Association (P.A.), you only need to complete the CMS 855I.  Pay particular attention to section 4 (A) which you would need to complete since you are the sole owner of a Professional Association and will bill Medicare through this business entity.   However, when you apply for your personal NPI, you should also apply for a NPI number pertaining to your Professional Association utilizing its tax ID number.  You will also have to submit a Medicare Participation Agreement and EFT 558 form for electronic funds transfer.  Please refer to Medicare Registration at for specific guidance.

    Our group practice received our Medicare number last year and was entered into the PECOS system. During that process, my partners and I also revalidated with Medicare Provider Enrollment. Is it true that we will have to revalidate again by 2013 and go through this entire painful process once more? Can we start the revalidation process now in order to get it over with?

Internal Medicine
Hollywood Florida

  Its official, you must revalidate by 2013. Every provider who was enrolled in Medicare before March 25, 2011 must revalidate with Medicare in order to keep their billing privileges. However, you must wait for a letter from Medicare Provider Enrollment asking you to start your revalidation process. Your deadline for this is March 23 2013. If you do not make the deadline, your Medicare payments will be frozen until you are revalidated and updated in the Provider Enrollment Chain Ownership System (PECOS). You can revalidate utilizing the appropriate CMS855 forms or online through the PECOS website. It’s important to remember that revalidation means resubmitting your entire enrollment data and information including various supporting documents.

 I have a large geriatric practice and have started to perform more and more debridements. One of the reasons for this increase is that my nursing home patients have increased.   I am confused as to when I can and cannot bill a visit with these debridement codes. Any direction?

Geriatric Physician
Fort Lauderdale, FL

A:  Visits by the same physician on the same day as a minor surgery are included in the payment for the procedure unless a significant, separately identifiable service is also performed. As an example, a visit on the same day could be probably billed in addition to suturing a scalp wound if a full neurological examination is made for a patient with head trauma. You would attach a "25"modifer to your visit code which means it is a separately identified service.   Billing for a visit would not be appropriate if the physician only identified the need for the procedure and confirmed allergy and immunization status.

The initial consultation for evaluation of the problem by the physician to determine the need for surgery may be covered, but this policy only applies to major surgical procedures. The initial evaluation is always included in the allowance for a minor surgical procedure. Please refer to the CMS (Centers for Medicare and Medicaid) website for further instructions and a complete list of minor and major surgical procedures.

Mr. Frosch is the President of Frosch Medical Consultants, Inc. in Plantation, FL.                  

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Last Updated on Monday, 16 January 2012 13:09
ASK BEN: Medicare Q & A Fall 2011 Update (cont.) Print E-mail
Written by Benjamin L. Frosch   
Sunday, 13 November 2011 10:47

   Our practice does accept Medicare patients but we are not happy with Medicare's policies and payments in addition to all the trouble with denials, resubmission, etc. I would like to become a private practice that accepts no insurance whatsoever. I have heard that I cannot stop being a Medicare provider even if I opt out of Medicare. I could not have patients that hold a Medicare card as a private patient and charge my regular rate. Is it true?  

How can I have a practice that does not have to deal with health insurance companies or Medicare and where all patients would be self pay regardless of what insurance they may have? If the patients want to submit a claim to their insurance, that would be between them and their insurance company. In my view, we should be able to just hang a sign saying "We accept no insurance. Every patient is personally responsible for the payment of all charges which are due at the time of service". However, it seems impossible.

General Practice Medicine
Miami, FL

A: It is not impossible; however it may be difficult to find patients that agree to that financial arrangement. With respect to Medicare beneficiaries, if you decide to opt out of the Medicare program, you can charge Medicare patients whatever you wish. However, there are a variety of steps that must be taken to "opt out" and comply with Medicare regulations. For starters, in order for you to "opt out" you would need to complete and sign an "opt out affidavit" and submit it to Medicare Registration at First Coast Service Options, Inc. (FCSO). Thereafter, you would need to provide each of your Medicare patients with an "opt out contract" that specifies the conditions such as the fact that they are totally responsible for your fees and cannot even submit a claim to Medicare unassigned. There is a lot of detail to "opting out" of the Medicare program, please refer to for further information.

As far as private insured patients, you are not obligated to accept their insurance and you can charge them your regular rate at the time of service assuming you have no contractual obligations with any insurance company.

Mr. Frosch is the President of Frosch Medical Consultants, Inc. in Plantation, FL.

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Last Updated on Wednesday, 23 November 2011 13:03
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