Medicare Improper Payments Report

According to Part B News (, some specialty groups may want to take a closer look at their coding and billing processes for office visit codes 99201-99215 after a new report from CMS details more than a billion-dollar blunder. A dozen specialty groups are linked to more than $1.2 billion in improper payments in 2016 for the 10 E/M office codes, according to The Supplementary Appendices for the Medicare Fee-for-Service 2016 Improper Payments Report. The top three groups – internal medicine, family practice and cardiology – account for nearly half, or 49%, of the total improper payments, even though their percentage of improper payments is lower than other groups. For instance, neurology leads the way with an 18% improper payment rate, compared with 8% for internal medicine and family practice, though improper payments for neurology, at $62 million, were dwarfed by internal medicine ($262 million), family practice ($223 million) and cardiology ($146 million). Remember that not all improper payments mean that you’re overbilling Medicare. In fact, significant underpayments, which occur when a practice downcodes a service to a lower level E/M than warranted, also prevail. In 2016, CMS estimates that providers downcoded about $342 million worth of E/M office visits. In the same year, upcoding office visits accounted for $426 million in erroneous payments. Orthopedic surgery, urology and podiatry also made the list with sizable improper payments. Hematology/oncology, dermatology and ophthalmology had smaller amounts and lower rates. The report compels practices to take a closer look at their coding – CMS estimates that 59% of the billing errors for established office codes occur because of incorrect coding; 32% are attributed to insufficient documentation; and just 2% relate to errors in medical necessity. A greater portion, or 83%, of billing errors for new office visit codes are a result of incorrect coding.

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