Doctors, others billing Medicare at higher rates

Thousands of doctors and other medical professionals have billed Medicare for increasingly complicated and costly treatments over the past decade, adding $11 billion or more to their fees — and signaling a possible rise in medical billing abuse, according to an investigation by the Center for Public Integrity.

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Over the past decade, doctors have increasingly used higher-paying codes while cutting back on lower-paying codes

Between 2001 and 2010, doctors increasingly moved to higher-paying codes for billing Medicare for office visits while cutting back on lower-paying ones, according to a year-long examination of about 362 million claims. In 2001, the two highest codes were listed on about 25 percent of the doctor-visit claims; in 2010, they were on 40 percent.

Similarly, hospitals sharply stepped up the use of the highest codes for emergency room visits while cutting back on the lowest codes.

Medical groups say the shift to higher codes reflects the fact that seniors have gotten older and sicker, requiring more complex care. “I rarely have a person who comes to me for a cold,” said Brantley B. Pace, who has practiced family medicine for more than a half-century in Monticello, Miss., and whose bills were among the highest in the sample of claims.

Although patients at individual practices such as Pace’s may be older and sicker, many health-care experts say the age and health of Medicare beneficiaries as a group has not changed, and research supports that contention.

The Center for Public Integrity’s analysis shows no increase in the average age of patients during the decade. Medicare billing data do not indicate that patients are getting more infirm, as their reasons for visiting their doctors were essentially unchanged over time. And annual surveys by the federal Centers for Disease Control and Prevention have found little increase in the amount of time physicians spend with patients.

That suggests that at least part of the shift to higher codes is due to “upcoding” — also known as “code creep” — a form of bill-padding in which doctors and others bill Medicare for more expensive services than were actually delivered, according to health experts and the data analysis by the center.

“This is an urgent problem,” said Mark B. McClellan, a physician who ran the federal Centers for Medicare and Medicaid Services during the George W. Bush administration. He said that CMS should demonstrate it “won’t stand by and do nothing” as payments climb.

Doctors, hospital emergency rooms and many other providers are paid by Medicare based on a series of billing codes that are designed to reflect the complexity of the treatments delivered and the time required. For doctor visits, the lowest code, which pays about $20, is for minimal problems requiring a few minutes’ time. The highest code, which pays about $140, is for more serious cases that typically require
40 minutes of face-to-face contact.

Providers could be deliberately inflating their bills, or simply doing their best to comply with a complicated system. Either way, the aggressive push to electronic medical records is likely fueling the trend toward higher codes, analysts say.