Imagine getting a demand letter from a carrier that states your practice has incorrectly billed a procedure for the last year. To make matters worse, the carrier is asking you to return an overpayment, which amounts to thousands of dollars, and they want the full overpayment check within 45 days. Believe it or not, this scenario happens to rheumatology practices across the country.
Regardless if the carrier is right or wrong, you must respond to a demand letter within 45 days of receipt. If you want to appeal, refer to “Appealing an Audit” in the December issue of The Rheumatologist (p. 20) for step-by-step information on the process.
The ACR offers resources to support a practice’s coding and billing department including:
- The Rheumatology Coding Manual;
- The Business Side of Rheumatology Practice manual;
- National Medicare fee schedules;
- Physician Quality Reporting Initiative information;
- Patient documentation templates; and
- Coding, billing, and audit presentations at state society meetings.
Visit www.rheumatology.org/practice to learn more about any of these resources.
Receiving a demand letter like this can result from a number of missteps. Here are the two common mistakes that put your practice at risk for incorrect coding:
- Staff is not properly trained in all coding and billing guidelines. Coding guidelines are constantly changing, and it is the practice’s responsibility to keep staff up to date. “I did not know” is not an acceptable excuse to an insurance carrier. Furthermore, just because a carrier pays for something does not mean it was correctly paid. This can occur if claims are adjudicated and there was a system problem that allowed a noncovered charge to be paid. For example, drug administration codes changed in 2004. The code 99211 was no longer allowed to be billed with the new codes. One carrier continued to incorrectly reimburse for this code for two years and when the mistake was discovered, the carrier demanded compensation for the incorrect payments in one lump sum. A practice that had been using the 99211 code incorrectly was devastated, and it had no recourse except to pay the money back or let the carrier recoup the money from all future claims until the overpayment was repaid.
- Viewing a new drug or piece of equipment as an avenue to increase the practice’s revenue. A carrier may not deem the drug or equipment as medically necessary, and you should research new products or equipment before purchase to ensure you will be covered.
Liability for incorrectly billing or handling appeal requests rests on the physician. When hiring billing, coding, and practice administrator staff, here are basic questions you should ask in the interview:
- Do you know how to read and understand an explanation of benefits?
- Do you know the coding rules for rheumatology procedures?
- Do you know how to export and assess an accounts receivable report?
- Do you know the guidelines for handling appeals?
In today’s climate of audits, prior authorizations, and medical policies, rheumatologists cannot afford to practice in ignorance of coding and billing guidelines because the financial stability of the practice is at risk.