Audit Risk: EHR Coding, Cloning, and Templated Notes

Audit Risk: EHR Coding, Cloning, and Templated NotesPhysicians beware: CMS recently expanded RAC audits (Recovery Audit Contractors) to include office visit (E&M) claims, with the goal of identifying inflated coding and aggressively pursuing fraud and abuse. A recent New York Times article, “Medicare Bills Rise as Records Turn Electronic”, alleged that “EHRs may be contributing to higher Medicare costs because they make it easier to bill more for services.” This is a natural outgrowth of the pre-meaningful use origins of many EHRs—they were typically designed to create a clinical note that would maximize reimbursement. The point-and-click, templated notes of many EHRs will also be subject to intense scrutiny—because the notes often include copied and pasted text and omit the nuanced information that is critical to truly meaningful documentation.

In a sternly worded letter to hospital and medical association executives on September 24, HHS Secretary Kathleen Sebelius and Attorney General Eric Holder warned that they “will not tolerate health care fraud” and will take steps “to ensure payment accuracy.” They expressed serious concerns that some providers are misusing EHRs to increase reimbursement by cloning medical record documentation and by upcoding visits.

This new focus on auditing E&M coding was spurred by the findings of a report by the OIG (Office of the Inspector General) issued in May 2012, “Coding Trends of Medicare Evaluation and Management Services.” Over the last 10 years, physicians have increased their billing of higher-level E&M codes and reduced their billing of lower-level codes. Therefore, the OIG recommended that CMS have its contractors review physicians’ billings for E&M services and that they review—for appropriate action—those physicians who bill higher-level codes.

One of Medicare’s administrative contractors, (National Government Services), recently announced that it will not accept cloned documentation. “Cloned documentation will be considered misrepresentation of the medical necessity requirement for coverage of services due to the lack of specific individual information for each unique patient. Identification of this type of documentation will lead to denial of services for lack of medical necessity and the recoupment of all overpayments.”

These audits pose a significant risk since auditors are paid based on the amount they recover from providers.