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A Medical Charting Error Could Be a Federal Crime


Periodic internal audits can save physicians a lot of grief - if the government thinks the physician had knowledge of an error in a medical record or willfully disregarded it, then the physician can face criminal fraud charges.

John Natale, MD, a highly skilled thoracic and cardiovascular surgeon, is currently sitting in a federal prison. After being indicted for Medicare fraud, then found not guilty by the jury on all fraud charges, he was convicted on two counts of making false statements in his operative reports.

Writing in her column for the Association of American Physicians and Surgeons, Jane Orient, MD, notes that “the term ‘false statement’ suggests a deliberate lie,” but could actually be a simple error made while dictating reports.

The judge in Natale’s case has noted that any error in any medical record related to a health program could be a federal crime. That sounds severe, but Kathrin Kudner, an attorney with Dykema Gossett, a member of the firm’s Health Care Practice, and chair of the firm’s HIPAA task force, is not surprised by the proceedings.

“If you’ve read anything about health care reform, clearly fraud and abuse enforcement is one of the big targets,” Kudner says.

To error is …

Kudner explains that there are several ways that a doctor or hospital can miscue on a claim. When a claim is filed for Medicare or Medicaid, it has to be accurate. A physician must list services that he or she rendered on the date they were rendered, and at the level they were rendered. For example, a physician office visit can be billed as a brief, moderate, extended or advanced visit. The reimbursement rates are higher for the more extensive visit.

The other concept in Medicare is that reimbursement will be made only for services that were medically necessary. That, says Kudner, is a very subjective analysis as to whether a particular level of care or a kind of procedure or particular device is medically necessary to meet the needs of the patient. And the biggest offender here is not having sufficient documentation in the record to substantiate the care the physician actually did deliver.

“That’s what I see the most, are situations where the documentation is sloppy, and it’s just not as complete as it needs to be in order to justify the claim that [a physician is] making,” Kudner explains. “It’s not that the doctor or hospital didn’t provide the service; it’s not that the service wasn’t medically necessary; it’s not that the service was at the wrong level; it’s just that what is written in the chart doesn’t substantiate any of the claim, or all of the claim. So when Medicare comes in and audits, all they do is look at the record. And if the record doesn’t have the right kind of information in there, they’re going to deem that to be a false claim.”

Does punishment fit the crime?

Kudner says that if a physician truly did make an error and the government believes he or she made an error, the penalty is really repayment of what the government considers the funds they shouldn’t have received. However, if the government thinks the physician had knowledge or willful disregard or was intentional, then they’ll come after you under a criminal fraud statute.

“A lot of these (cases) you don’t even see in the paper,” she explains. “What happens is they’re found on an audit, or they’re found by some kind of internal desk audit, and they’re just settled, and they don’t ever come up to the level of litigation. But the false claims act itself has a knowledge standard that you knowingly presented or caused to be presented … and case law has sort of made that a little broader by saying known or should have known.”

That “should have known” is what causes all the heartache, Kudner says. There are a lot of Medicare and Medicaid regulations. “Should have known” means that if a physician receives a bulletin and it detailed how to re-code something a particular way, and the physician fails to do that, it could be a false claim. That puts physicians on notice of all the regulations, all the transmittals, all the bulletins that they receive.

“I think that’s a pretty onerous burden,” Kudner says. “But the government does do some kind of screening. If it’s a consistent and repetitive error, if it’s a one time glitch in your computer system that you put a coding mechanism in wrong so everything you put in under that code got shot out as a false claim, all of those are taken into consideration when you go back to the government with an argument.”

Protecting yourself

Kudner suggests physicians do periodic internal audits — just pull 10 records and check them for accuracy. Also, make certain staff is well trained. Every office should have at least one person who is a coding specialist.

“And make sure that if you are getting denials, or you’ve had some auditing issues, that you do a pre-claim audit,” Kudner suggests. “Go through the record before you submit it, just as the government would do post-payment.”

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