Nowadays, rarely does a week go by without the Department of Justice announcing another settlement related to allegations of a lack of medical necessity resulting in false claims. It’s a significant black eye for the healthcare compliance industry – one that compliance professionals should constantly be working to avoid.
As they do so, they should keep the following tips in mind as they assess and monitor the medical necessity of claims.
Tip #1 – Insurance Coverage
When speaking with clinicians, make sure to clarify that medical necessity billing risks are not necessarily an attempt to second-guess a clinician’s decision for care, but rather an insurance coverage issue. For example, “the OIG recognizes that physicians should be able to order any tests, including screening tests, they believe are appropriate for the treatment of their patients. However, a physician practice should be aware that Medicare will only pay for services that meet the Medicare definition of reasonable and necessary.”1
Too often, compliance professionals lead the conversation with a statement that “the services were not medically necessary.” Instead, they could say, “the services did not meet Medicare’s definition of medical necessity or coverage.”
Tip #2 – LCDs and NCDs
Help revenue cycle professionals and clinicians become aware of the local Medicare Administrative Contractor’s (MAC) local coverage determinations (LCD) and Medicare’s national coverage determinations (NCD). These policies outline coverage criteria for specific services identified by medical codes. In many LCDs, there are narrative descriptions of expectations before Medicare considers the services medically necessary. For example, one MAC’s LCD for spinal facet joint injections requires documented failure of attempts for conservative therapy to treat the patient’s pain before performing spinal injections. Specifically, it states the medical record of the patient must demonstrate “pain present for minimum of 3 months with documented failure to respond to noninvasive conservative management (as tolerated).” So, clinicians who order or perform facet joint injections run the risk of the claims being “medically unnecessary” or not covered under the LCD. Other LCDs also have similar narrative descriptions outlining expectations for coverage, or for what the local MAC considers to be “medically necessary.”
Tip #3 – Maximize Clinical Training
Auditing and monitoring for medical necessity can be a challenge because many compliance programs do not employ individuals with medical training. These people are usually in the best position to determine whether the services meet medical necessity requirements. Most compliance programs do, however, ensure that medical claims submitted to payors are audited and/or monitored by certified medical coders who assess whether the codes reported are supported by the medical documentation.
Still, most medical coders are not clinically trained, nor do they usually perform medical necessity reviews when they are performing coding audits. With this in mind, compliance programs should involve individuals with at least some clinical training to perform auditing and monitoring with an eye on medical necessity. It does not always need to be a clinical specialist involved at the beginning of an audit or monitoring procedure. Such individuals with basic clinical training can screen claims for medical necessity, and if/when a more formal opinion is needed they can then engage clinicians who have specialized training in a particular treatment or procedure.
Conclusion
There is no silver bullet to solving medical necessity risks as they relate to medical claims submitted to payers such as Medicare. That said, these tips can be a starting point for compliance programs who know they need to minimize their compliance risk around medical necessity.
Download CJ’s tip sheet below
CJ Wolf, MD, M.Ed. is a healthcare compliance professional with over 22 years of experience in healthcare economics, revenue cycle, coding, billing, and healthcare compliance. He has worked for Intermountain Healthcare, the University of Texas MD Anderson Cancer Center, the University of Texas System, an international medical device company and a healthcare compliance software start up. Currently, Dr. Wolf teaches and provides private healthcare compliance and coding consulting services as well as training.
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