OIG Report Alleges that Telehealth Claims Did Not Meet Medicare Requirements

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OIG recently issued a report in April 2018 titled, “CMS Paid Practitioners for Telehealth Services That Did Not Meet Medicare Requirements,” in which it claims to have found that CMS improperly paid practitioners in 31 of 100 telehealth claims reviewed.  In the report, OIG asserted  that CMS could have saved approximately $3.7 million during the audit period of 2014 and 2015 “if practitioners had provided telehealth services in accordance with Medicare requirements.”  What OIG apparently meant by this was that if either CMS had denied the claims or the claims had been submitted in a manner it found acceptable, Medicare would have saved approximately $3,699,848 for calendar years 2014 and 2015.  Accordingly, OIG made a few recommendations regarding how CMS may realize savings in the future, namely, that CMS conduct post-payment reviews on telehealth claims, educate practitioners on Medicare requirements for telehealth services and work with the Medicare Administrative Contractors (MACs) to implement all of the claim edits for telehealth services in the Medicare Claims Processing Manual.

If a telehealth service satisfies Medicare requirements, both the originating site and the distant site may bill Medicare.  For qualifying telehealth services, Medicare payments include a professional fee, paid to the practitioner performing the telehealth service at a distant site, and an associated originating site facility fee, paid to the facility where the beneficiary receives the telehealth service.  During the audit period, the originating site fee under the Medicare fee schedule was approximately $25.  Practitioners bill Medicare for the distant site professional service by adding a modifier to the appropriate HCPCS code indicating a telehealth service.  Because a 2009 MedPAC report found that errors are more likely to occur in claims where the originating site does not bill Medicare for the telehealth service, OIG only reviewed claims where the originating site did not bill Medicare.

Medicare Part B pays for telehealth services provided by a practitioner to a beneficiary through a telecommunications system if certain requirements are met.  First, with the exception of a Federal demonstration program in Alaska and Hawaii, the communication must be a real-time audio and visual communication system.  Two of the claims reviewed in the sample failed to satisfy this requirement.

Second, the originating site must: (i) be located in a county outside of a metropolitan statistical area (MSA); (ii) be located in a health professional shortage area (HPSA) that is either outside an MSA or within a rural census tract; or (iii) have been participating in a Federal demonstration project prior to December 31, 2000.  OIG reported that 24 of the claims failed to meet this requirement.

Third, the originating site must be a hospital, critical access hospital, skilled nursing facility, rural health clinic, federally qualified health center, hospital-based or CAH-based renal dialysis center, practitioner office, or community mental health center.  Three claims were provided at unauthorized originating sites.

Fourth, only clinicians and telemedicine entities may bill Medicare for professional distant site services.  Seven of the claims were improperly billed by institutional providers.  Further, one of the claims in the sample did not include an allowable professional code for a telehealth service.

Finally, the telehealth service for one claim was improperly provided by a practitioner outside of the United States.

A copy of the OIG’s report is available here.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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