Screen Medicare's Highest-Paid for Overpayments, OIG Says

December 23, 2013

For physicians, earning a ton of money from Medicare could result in more scrutiny from investigators who suspect incorrect or fraudulent billing.

That is a likely consequence of a study released December 20 by the Office of Inspector General (OIG) of the Department of Health and Human Services (HHS), which looked at 303 physicians who each received more than $3 million from Medicare in 2009. Their total haul of $1.3 billion represented almost 2% of the total amount Medicare spent on clinician services that year.

Of those 303 physicians, 104 (34%) were later flagged for improper payment reviews by Medicare administrative contractors, which process claims on behalf of the government, and zone program integrity contractors, which sniff out fraud, waste, and abuse. At the end of 2011, these contractors had finished reviewing 80 of the 104 physicians and cleared 48 of any improprieties. The remaining 32 clinicians who were reviewed, however, had some problems:

  • 13 accounted for $34 million in overpayments,

  • 11 received educational letters,

  • 6 were forced to participate in prepayment reviews going forward, and

  • 3 physicians, including 1 of the 13 who were overpaid, had their medical licenses suspended.

In addition, 2 of the 24 physicians whose reviews were ongoing were indicted.

These reviews, the OIG concludes, demonstrate that identifying physicians who receive big bucks from Medicare could help the program spot — and presumably recover — improper payments. It recommended that the Centers for Medicare & Medicaid Services (CMS) set a threshold of cumulative payments that would trigger a review of a physician's claims and figure out how to quickly spot and review claims that exceed the threshold.

CMS said it "partially concurred" with the 2 recommendations but otherwise indicated it would carry them out. In a written response that was part of the OIG report, CMS said it would consider factors such as provider specialty and service type in setting "appropriate threshold levels." It also said it would develop procedures for timely identification and review of clinician claims that exceed the cumulative payment threshold.

High Rollers in Medicare on the Rise

The high rollers whom OIG wants under surveillance are on the rise. In 2011, a total of 476 clinicians collected more than $3 million apiece from Medicare, up almost 78% from 268 clinicians in 2008. During that same period, the number of clinicians in Medicare's Part B program rose 12.5%.

Similarly, Medicare payments increased by nearly 14% for all participating clinicians but by 77% for the clinicians over the $3 million mark. This top tier of clinicians accounted for 2.7% of all Medicare Part B spending in 2011 compared with 1.7% in 2008.

Three medical specialties accounted for 78% of the physicians in the $3 million club in 2009: internal medicine (55%), radiation oncology (12%), and ophthalmology (11%).

Members of this group also were concentrated in terms of geography: 62% practiced in just 6 states: Florida (28%), California (8%), New Jersey (7%), Texas (7%), New York (6%), and Illinois (6%).

The full OIG report is available on the agency's Web site.

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