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Medicare Advantage (MA), also known as Medicare Part C, provides Medicare recipients an alternative to traditional fee-for-service Medicare, replacing the beneficiary’s Part A and Part B plans. Most MA plans are operated by the traditional commercial insurers such as Blue Cross, UnitedHealthCare, and Aetna. Because an increasing number of Medicare beneficiaries are choosing to enroll in MA plans, the Office of Inspector General (OIG) of the U.S. Department of Health and Human Services (HHS) has taken great interest in their activities.

Overall, the 2015 Work Plan recently issued by the OIG contained no big surprises, with few new target areas for audit. As in the past, the OIG will be looking at several issues related to MA plans, including risk adjustments. “We will review the medical record documentation to ensure that it supports the diagnoses MA organizations submitted to CMS (the Centers for Medicare & Medicaid Services) for use in CMS’s risk-score calculations and determine whether the diagnoses submitted complied with federal requirements,” the language of the plan reads. “Prior OIG reviews have shown that medical record documentation does not always support the diagnoses submitted to CMS by MA organizations.”

CMS pays MA plans a monthly amount based on enrolled patients’ medical conditions and the estimated costs to provide care. CMS bases the payment on a complex formula that uses the hierarchical condition categories (HCCs) to determine the appropriate risk estimates and anticipated costs of care. In a presentation published by Aetna in 2012, it was reported that an 85-year-old female with diabetes would result in a monthly payment of $481, but if the physician documented that the patient had diabetes-related chronic kidney disease, malnutrition, a history of a myocardial infarction, and a below-knee amputation, the monthly payment would be $2,475.

By regulation, these conditions must be documented properly in order to be considered in the HCC calculation. The diagnosis must be based on clinical medical record documentation recorded from a face-to-face encounter, coded according to the ICD-9-CM Guidelines for Coding and Reporting, assigned based on dates of service within the data collection period, and submitted to the MA organization from an appropriate risk adjustment provider type and an appropriate risk adjustment physician data source.  The diagnoses must be documented each year to qualify as an HCC for that year’s payment to the MA plan.

As one can imagine, when physicians are told that documenting more specifically in their office chart will result in a higher payment for the MA plan and nothing for them, they take little interest. In fact, better documentation does help the physician with his or her own quality scores, which can lead to future pay differentials. But the MA plans have decided that they cannot depend on independent physicians to document all these conditions properly and have taken on a new tactic: paying doctors to do it right.

The MA plans have started contracting with private companies that pay physicians to go to beneficiary’s homes, conduct a history and physical exam, and submit these records to the MA plan for HCC coding and maximization of their monthly payment. One such company pays doctors $100 per visit, plus expenses. They provide the physician with a carefully prepared documentation template that allows the doctor to capture every medical diagnosis with the highest specificity and current status and perform a complete examination, including the testing of orthostatic vital signs, a retinal examination, and examination for peripheral neuropathy. These physicians are provided malpractice insurance even though the company states that malpractice insurance is not required, as the physician is not providing care but rather gathering information. When all the information is collected, it goes through the company quality assurance department and then a list of recommended interventions based on published standards is forwarded to the patient’s primary care physician.

So while this meets the letter of the regulation, with documentation by a physician and a report sent to the primary care physician, does it meet the spirit of the regulation or is it actually sophisticated gaming? Without lab results, can a physician really know that a patient has chronic kidney disease or that his or her diabetes is controlled or uncontrolled? Can a non-dilated retinal examination in someone’s living room detect diabetic retinopathy? If a patient states he has a bad heart and takes lisinopril and an occasional furosemide, does that mean he has uncompensated systolic heart failure (or perhaps well-compensated diastolic heart failure?) I am sure the OIG will consider all these factors, and the overarching concept of the use of HCC documentation by a physician who is providing no medical care to the patient, as it reviews HCC coding practices by the MA plans.

About the Author

Ronald Hirsch, MD, is vice president of the Regulations and Education Group at Accretive Physician Advisory Services at Accretive Health. Dr. Hirsch’s career in medicine includes many clinical leadership roles at healthcare organizations ranging from acute care hospitals and home health agencies to long-term care facilities and group medical practices. In addition to serving as a medical director of case management and medical necessity reviewer throughout his career, Dr. Hirsch has delivered numerous peer lectures on case management best practices and is a published author on the topic. He is a member of the American Case Management Association and a Fellow of the American College of Physicians

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