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Prepare for OIG, CMS scrutiny

Physician Compensation & Recruitment, December 11, 2008

With the release of the 2009 OIG Work Plan and CMS' plan to audit 500 hospitals for Stark compliance, now is the time to prepare for greater scrutiny.

Practices need to review the compensation plans they have with hospitals, and vice versa, says Todd Rodriguez, partner and cochair of the health law practice group at Fox Rothschild, LLP, in Exton, PA.

Among the issues of note are the following:

E/M services during global surgery periods. The OIG will review industry practices related to the number of E/M services provided by physicians and reimbursed as part of the global surgery fee. Among the possible questions to be explored are:

  • Have industry practices related to the number of E/M services provided during the global surgery period changed since the global surgery fee concept was developed in 1992?
  • Has there been improper billing of E/M services during global surgery periods?
  • How frequently are claims paid for services provided in the postoperative period?
  • How has bundling affected the type of care physicians are providing?

It's not completely clear what the OIG is looking for, says Rodriguez, but he suspects that the focus may be on quality-of-care issues.

Incident-to billing. The OIG will look at whether physicians are properly billing for incident-to services. Incident-to billing has been on the Work Plan in past years and its reappearance reflects continued interest in the rules—and noncompliance with them, Rodriguez says. The OIG will also examine the qualifications of nonphysician practitioners to determine whether those qualifications are consistent with professionally recognized standards of care.

Physician reassignment of benefits. The OIG will review the extent to which Medicare physicians reassign their benefits to other entities. This issue arises directly from problems in Florida. The Work Plan states:

Investigations in South Florida have revealed schemes in which fraudulent providers obtain identifying information about legitimate physicians and request reassignments on their behalf. We will examine a national sample of Medicare physicians to determine the extent to which they reassign their benefits to other entities and the extent to which the physicians are aware of their reassignments.

Hospital ownership of physician practices. The OIG will review the appropriateness of Medicare reimbursement for hospital-owned physician practices that have a provider-based designation. Hospitals may receive higher Medicare reimbursements for outpatient services in provider-based practices under the hospital outpatient prospective payment system (OPPS) than under CMS' Medicare Physician Fee Schedule. One review will consider whether hospitals met federal requirements for a provider-based designation and assess the increased cost to Medicare. The other will look for improper payments to hospitals without provider-based designations under the OPPS.


This article was adapted from one that originally ran in the December 2008 issue of Physician Compensation & Recruitment, a HealthLeaders Media publication.

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