Resist the Temptation to "Up-Code!"

By way of example, assume you are a physician who is visited by a new patient. The patient may be covered by a health insurance plan where you are a participating provider (“In-Network”) or where you are not (“Out-of-Network”), Medicare, or Medicaid. The patient may have been injured in a motor vehicle collision and covered under Personal Injury Protection (“PIP”) benefits provided by their automobile insurance carrier.

You provide an initial examination and diagnosis, which must be categorized under the appropriate CPT Code to identify the procedure performed. This is typically not a difficult choice for an initial examination and evaluation. However, the Code must also include a modifier indicating the level of complexity of the patient encounter – ranging from “1” for a routine evaluation, to “5” for an extremely complex evaluation.

Of course, procedures coded at level “5” carry the highest reimbursement to the physician. This may give rise to an impulse to “Up-Code,” that is, to assign a complexity level higher than the actual examination would warrant. DO NOT DO THIS!!! You must resist this temptation!

The Centers for Medicare & Medicaid Services (“CMS”), CMS’s contractors, health insurance carriers, and automobile insurance carriers, all perform computer data analysis on a physician’s coding practices. Computer models predict the expected mix of complexity levels of patient encounters, from routine to extremely complex. If your coding falls outside the parameters expected by the computer, you will get an inquiry from an insurer. The further outside the parameters you fall, the more likely you are to be subject to a full audit, and a repayment demand.

Particularly with respect to CMS, if you engage in blatant “Up-Coding,” this can result in prosecution under the False Claims Act, and otherwise. Physicians evaluating patients injured in automobile collisions have been known to code EVERY initial patient encounter at level “5.” This is a sure way to encounter scrutiny and it will not end well. Of course, if an evaluation warrants coding at level “5” then do so, providing what is reflected in the patient’s chart supports a finding of an extremely complex evaluation. However, it is guaranteed that every single case will NOT be a level “5!” Indeed, such cases are few and far between.

Just as it is in the case of contacting a physician regarding any disease process, if you are involved in any of these inquiries, the sooner you contact competent healthcare counsel, the better chance you have of a favorable outcome.

If you would like a consultation on this or any legal matter, do not hesitate to contact Scaringi Law at 717-657-7770.