OIG Finds Overpayment on Modifier 25 Use

In a public notice dated May 21, 2012, by the Office of the Inspector General (OIG), a Burlington, Vermont health care system agreed to refund $211,000 for services from 2008 to 2010. This total represented both hospital and physician services. The review found that the office visit documentation frequently did not support the use of modifier 25 in conjunction with eye injections.

OIG noted in the Press Release that:

“The billing errors occurred because the providers believed in good faith that the care they provided included a separately billable E&M service. In all of the sampled claims, the provider not only assessed and prepared the patient for the eye injection and provided the injection, he or she also examined the patient’s other eye and assessed the potential effects of the patient’s other conditions, such as diabetes and hypertension, on that eye. The providers feel that this approach promotes efficient and high quality medical care, and likely reduces the need for additional visits. On further review of these claims by certified coders, however, . . . the documentation . . . did not support a separately billable E&M service because one component of the E&M service (medical decision making) was not documented regarding the eye not receiving the injection.”

Note that the refund was required, in spite of the OIG’s acknowledgement that the errors occurred “in good faith”.

Some of the significant findings of note within the OIG Press Release are:

100 claims out of 2,871 were reviewed from a random sample; only 15 of the 100 were found to meet coding guidelines

It was determined the other 85 of 100 services were incorrect since they “were not significant, separately identifiable, and above and beyond the usual preoperative work of the eye injection procedure.”

The other eye was examined but the services did not fully meet the Modifier 25 guidelines.

The full report can be found at: http://oig.hhs.gov/oas/reports/region1/11100515.pdf.

Modifier 25 use is under intense scrutiny by payers. It is not just current services that are being reviewed. Be sure you are in compliance with the rules and regulations surrounding this modifier and only use it when you fully meet the guidelines. If you have questions, Corcoran Consulting Group can help. We have numerous educational materials available to assist with training on this topic. For more information, contact us at 800.399.6565, or request our FAQ on Modifier-25 via this link.