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USA Today: 'Guardrails' needed? Telehealth fraud cost Medicare $128M in first year of COVID pandemic, feds say

12 Sep 2022 7:02 AM | Matt Zavadsky (Administrator)

Despite the intimation in the headline, the news report provides commentary on a federal report that reveals a small number of providers are likely responsible for the majority of potentially fraudulent telehealth billing, not unlike other aspects of the healthcare delivery system.

Reports like these will be crucial as MedPAC, HHS, Congress and states consider making payment flexibilities enacted as part of the PHE, permanent. The availability of telehealth has helped EMS provide enhanced services to prevent avoidable ER visits.

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'Guardrails' needed? Telehealth fraud cost Medicare $128M in first year of COVID pandemic, feds say

Ken Alltucker

USA TODAY

September 11, 2022

https://www.usatoday.com/story/news/health/2022/09/11/covid-telehealth-fraud-medicare-hhs/8013711001/

Key Points:

  • During the first year of the COVID pandemic, 1,714 doctors and health providers billed Medicare nearly $128 million in “high risk” claims, according to a new report from federal investigators.
  • Telehealth industry officials caution against creating “inappropriate barriers” to care, saying the report shows only a small number of providers engage in potential fraud or wasteful billing.
  • More than 28 million seniors and disabled residents on Medicare accessed telehealth in the first year of the pandemic, an 88-fold increase from the previous year.

The federal government eased telehealth requirements at the beginning of the COVID-19 pandemic so more Americans could get remote care with fewer obstacles.

A report by government investigators last week found that more-permissive remote care has come at a price. During the first year of the pandemic, 1,714 doctors and health providers billed Medicare nearly $128 million in “high risk” claims, according to the Department of Health and Human Services Office of Inspector General.

Investigators said less than 1% of the 742,000 Medicare-certified doctors and other providers of telehealth services submitted roughly a half million problematic claims. Yet the billings are concerning enough that government investigators urged the Biden administration to tighten oversight to ensure millions of Americans can access remote care while safeguarding taxpayer dollars.

“We're really looking at practices that indicate a high probability of fraud, waste or abuse,” said Andrew VanLandingham, the HHS inspector general’s senior counselor for policy. 

The report comes less than two months after the inspector general's office alerted medical professionals about rising telemedicine fraud by companies that often pay kickbacks to doctors, labs and others to generate orders paid by Medicare and other federal health programs. Also in July, the Justice Department announced 36 people were charged for over $1 billion in health fraud involving telemedicine providers. Some were part of a telemarketing network that lured thousands of elderly or disabled patients to get unnecessary genetic testing or orders for medical equipment.

Medicare fraud, telehealth access and 'inappropriate barriers'

The latest inspector general report doesn’t address whether doctors or other providers intended to commit fraud, VanLandingham said, but the analysis suggests a high likelihood of billing abuses.

The report informs the Centers for Medicare and Medicaid Services, Congress and other stakeholders of potential ways a small percentage of providers are exploiting Medicare and suggests strategies to tighten oversight during the third year of the pandemic. 

The report also comes as Congress must decide whether to permanently extend pandemic-era telehealth rules that accelerated the use of remote care.

Telehealth industry officials say the report shows only a small number of health providers engage in potential fraud or wasteful billing. The officials also say decision-makers must evaluate the importance of convenient access for millions of Americans who get appropriate care.

“We want to make sure that in addressing concerns about fraud – as minute as that fraud might be – you're not erecting really harsh and inappropriate barriers,” said Kyle Zebley, the American Telemedicine Association’s senior vice president of public policy.

Before 2020, Medicare largely restricted telehealth to people who accessed medical care via video and audio connections set up in rural clinics. Amid the pandemic, Medicare allowed recipients in cities and suburbs to get care remotely, often from their home, via a phone call or a video chat. Medicare also more than doubled the types of services eligible for reimbursement

Medicare wanted to make it easier for people to get care without the risk of COVID-19 exposure during a visit to a clinic or hospital.

During the first year of the pandemic, more than 28 million seniors and disabled residents on Medicare accessed telehealth, an 88-fold increase from the previous year. Another inspector general report, also released last week, showed the expanded telehealth services reached more people in underserved populations and lower-income families eligible for Medicare and Medicaid.

The report did not identify doctors or hospitals that submitted claims investigators considered likely fraud, waste or abuse. However, examples included unnamed doctors who charged extra fees, billed the highest and most expensive level of care every time and submitted bills every day of the year.

Under Medicare’s fee-for-service billing, doctors are paid for the number of tests, procedures or other services they perform. And when patients require a higher level of care, reimbursement is more lucrative.

The report broadly recommended Medicare review the more than 1,700 doctors and providers suspected of abusive billing practices. Medicare also should crack down on a billing practice that allows lower-level providers such as physician assistants or nurse practitioners to bill Medicare using the name of a supervising physician. Billing using a supervisor's name existed before the pandemic, but VanLandingham said investigators are concerned such practices in telehealth could result in more subpar care.

"For oversight purposes, it's really critical for us to understand who was seeing that patient and where the physician was because that's how we can really ensure that that beneficiary is getting good quality care," VanLandingham said.

A 'facility fee,' double billing and other prolific charges

The report found hundreds of doctors inappropriately charged a "facility fee" while also billing for a telehealth visit.

Medicare allows a hospital or clinic to charge a facility fee when they host a patient who gets care from a remote provider – for example, a rural hospital that lacks a roster of specialists might connect a patient with a remote specialist located in a big city. However, a doctor who provides remote care isn't allowed to also collect a facility fee. Nearly two dozen doctors were prolific double billers, collecting a facility fee and a telehealth visit more than 1,000 times over the year, the report said.

Fiscal watchdog groups said the inspector general report points out potential problems Congress and Medicare must fix before extending the pandemic telehealth policies beyond the end of the public health emergency, now set to expire in mid-October, though it will likely be extended to mid-January. Congress passed a bill to stretch the relaxed telehealth policies five months beyond the public health emergency. Legislation pending in the Senate would continue the policies through 2024.

Josh Gordon is director of Health Policy for the Committee for a Responsible Federal Budget, a nonpartisan research group. His group released a report in April calling for safeguards to avoid unnecessary use, incentives, fraud and abuse. 

"If you set things up with the right incentives and the right guardrails from the beginning, it's a lot easier to get a handle on these programs over the long term," Gordon said. "If you wait, have it become very popular, very expensive, then it becomes much harder to go back and install guardrails or change the incentives."


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