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What is upcoding?

By Graham Cotten | | May 24, 2024

What Is Upcoding?

“Upcoding” is a type of Medicare fraud. Physicians and hospitals use CPT codes to bill Medicare for procedures and services they perform. When hospitals “upcode” a procedure, they bill Medicare using a CPT code meant for a longer or more complex procedure than the one they actually performed. Upcoding is illegal and can result in a federal lawsuit (such as a qui tam case) and even prosecution.

Take the example of a casual 5-minute patient visit that is upcoded to a comprehensive 50-minute examination. A physician sees a patient for 5 minutes and should have used CPT 99212 to bill for the patient visit. Instead, the physician uses CPT Code 99215, which is meant for patient visits that last at least 50 minutes and involve a comprehensive examination and medical decision making of high complexity. Because the casual visit was upcoded to a comprehensive exam, Medicare pays more money than it should have.

Real Life Example

A whistleblower filed a qui tam case against a New Jersey physician‘s office that had engaged in upcoding for five years. The physicians allegedly regularly upcoded certain Current Procedural Terminology (CPT) codes typically used to report more complex services, or services longer in duration, relating to the evaluation and management of patients. They also knowingly submitted claims to Medicare for services that a physician did not provide to patients by regularly billing for impossible days (when a physician purports to provide such a high volume of services or procedures in one day that there is no way the physician reasonably could have performed them all). The physician paid more than $700,000 to settle the case.

 

Blowing the Whistle

Whistleblowers play a crucial role in uncovering and combating illicit activities such as upcoding within the healthcare sector. Their unique position often provides them with insider information about fraudulent practices that might otherwise go unnoticed. This includes misconduct within healthcare facilities, billing companies, or other organizations involved in Medicare billing.

Possessing firsthand knowledge of fraudulent activities, whistleblowers can offer essential evidence to authorities. This evidence is critical in launching investigations and pursuing legal actions against perpetrators of Medicare fraud. The information provided by whistleblowers can expose complex schemes that defraud the system, leading to significant recoveries of misappropriated funds.

Filing a Qui Tam Case

The False Claims Act (FCA) is a key piece of legislation that incentivizes and protects whistleblowers. It allows individuals to file lawsuits on behalf of the government against entities engaged in fraud. Under the FCA, whistleblowers, also known as “relators,” are entitled to a portion of the funds recovered by the government, which can range from 15% to 30% of the total recovery, depending on various factors such as the extent of their contribution to the case.

Moreover, the FCA includes provisions to protect whistleblowers from retaliation by their employers. These protections are crucial in encouraging individuals to come forward without fear of losing their jobs or facing other forms of retribution. Whistleblowers are shielded from actions such as termination, demotion, harassment, and other adverse employment practices.

Ultimately, whistleblowers serve as key allies in the fight against Medicare fraud. Their actions help to uphold the integrity of the healthcare system, ensuring that taxpayer dollars are used appropriately and effectively to provide quality care to those in need. By hiring an attorney who can help them navigate an FCA case, whistleblowers not only contribute to significant financial recoveries for the government but also promote a culture of accountability and transparency within the healthcare industry.

 

What is upcoding