American College of Physicians: Internal Medicine — Doctors for Adults ®

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HHS eases audits of physician pay at teaching hospitals

From the September 1997 ACP Observer, copyright © 1997 by the American College of Physicians.

ACP was pleased with a decision by Health and Human Services (HHS) officials this summer to discontinue 16 of the 49 investigations into fraudulent billing practices at teaching hospitals, but felt that the move didn't go far enough.

The agency told academic centers that it will conduct audits only in those states where Medicare carriers had clearly explained the rules regarding reimbursement for the services of teaching physicians before Dec. 30, 1992. Investigations have been stopped at teaching hospitals in Massachusetts, Missouri, Oregon, Puerto Rico, Texas and Vermont.

"This is an admission that unclear rules have been a problem," said Jack Ginsburg, ACP's Senior Associate for Policy Analysis. "HHS has corrected the problem in those states that were blatantly providing inadequate guidance, but we're not sure there has been adequate guidance in the remaining states where investigations continue."

The agency's "Physicians at Teaching Hospitals" (PATH) audits have focused on allegations that teaching hospitals routinely bill Medicare Part B for doctor's services that are actually provided by residents and trainees and merely supervised by teaching physicians. Medicare says teaching hospitals are already compensated for the supervision provided by teaching physicians through their Part A payments.

But some say that the audits are unfair because HHS is retroactively applying guidelines on how much documentation is needed to prove that a teaching physician was personally involved in the patient's care. ACP claims that there were no uniform guidelines for correct coding of teaching-physician visits before August 1995.

Nonetheless, the HHS inspector general and the Department of Justice have charged a number of academic medical centers with submitting inaccurate bills to Medicare, and two institutions have agreed to pay millions of dollars in fines and restitution.

At the annual meeting of the AMA's House of Delegates meeting this summer, an ACP-sponsored resolution called for the government to impose an "immediate moratorium" on the PATH initiative to give teaching hospitals at least a year to "develop and implement corrective action plans" to comply with new documentation requirements for physician services in teaching hospitals.

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