Medicare Compliance & Reimbursement

OIG finds lots of improper billing and fraud with physical therapy services.

Watch out: Your physical therapy billings could be under severe scrutiny next year, judging from the HHS Office of Inspector General's (OIG) semi-annual report on fraud and abuse.

A Texas physician received an 11-year, three-month sentence for taking part in schemes to defraud Medicare and Medicare, the OIG notes.

He accepted money from clinic owners in exchange for signing charts for physical therapy, helping the clinic owners to submit false claims.

In another scheme, the doctor ordered motorized wheelchairs for patients whom a company transported to his office and performed unnecessary medical services for those patients.

The number of physicians billing more than $1 million for physical therapy per year more than doubled from 2002 to 2004, the OIG found in a recent study. Claims for physical therapy increased from $353 million to $509 million during that period, and the OIG found "significant and persistent compliance and quality-of-care problems." Doctors' offices overbilled for services, used unskilled staff and billed for services that didn't meet Medicare coverage requirements.

Other convictions that the OIG noted:

• Another Texas physician, an osteopath, received a 10-year sentence and repaid $7.9 million. Investigators claimed he accepted cash in exchange for signing pre-printed prescriptions for more than 60 durable medical equipment companies around the country. The doctor can never practice medicine again without written permission from the court.

• A podiatrist in Illinois faces a 78-month prison stretch for health care fraud and must repay $1.8 million for fraudulent billings, but that's the least of his worries. A jury also found him guilty of murder and sentenced him to death. He allegedly shot a woman six times, a few days before she was due to testify before a grand jury about the more than 70 foot surgeries that he billed to Medicare but never performed. Also sentenced: an elderly beneficiary who allowed the podiatrist to use his personal information to bill Medicare for services that weren't performed.

 • A California audiologist allegedly billed Medicare and Medi-Cal--without a license--for hearing aids, speech therapy and related services.

She also allegedly billed for services provided to deceased patients. She received a 78-month sentence and must repay $868,000.

• An Ohio psychiatrist agreed to be excluded permanently from federal health programs after he allegedly billed Medicare for therapy sessions requiring 30 to 60 minutes of face-to-face patient time, but only provided medication checks of 15 minutes or less.

• A federal jury sentenced a Tennessee oncologist to 15 years and eight months in jail, plus $432,000 in restitution. She allegedly provided partial doses of chemotherapy to her patients, but billed for full doses and also falsified her charts.

• A court sentenced a New York dermatologist to 24 months in prison, and he also faced 50 years' exclusion from Medicare. A jury found him guilty of a scheme to distribute narcotic drugs unlawfully, causing the death of one patient who had visited the doctor as often as 24 times in one month.

The physician also repaid $888,000 and lost his license to practice medicine.

• Similarly, a Florida physician received a 25-year prison sentence and 30 years' exclusion from Medicare after a court found him guilty of Medicaid fraud and "controlled substance violations."

• Queens Hospital Center in New York agreed to pay $75,000 to resolve two patient-dumping allegations, including one where a doctor had examined the patient. The doctor gave a "cursory examination" to a nine-year-old girl who arrived in the emergency department (ED) complaining of fainting, vomiting and headaches. The doctor discharged the girl, but she died of a brain tumor while still in the ED. 

Consults, Drugs Still On OIG Radar

The OIG also recapped some of its most important reports from the past year:

• Medicare spent $1.1 billion on services that physicians wrongly billed as consults, the OIG said. Almost all top-level consults (95 percent) were wrongly coded, the OIG found.

• The OIG also looked into payments for Part B drugs and found that Medicare could be saving between $64 million and $164 million per year if it used other drug prices in the marketplace to set payment amounts. The Centers for Medicare & Medicaid Services didn't calculate the number of units of a drug sold in a consistent way, which led to some drugs being overpriced or underpriced, the OIG says.