Practice Management Alert

Plus, Excellus BCBS will send refunds for incorrectly denied lead screening tests.

Two state comptroller audits released in April 2012 show that Empire Blue Cross Blue Shield (BCBS) and United Healthcare (UHC) were overpaid by a combined total of $11 million for healthcare services, some of which were never even performed.

Both payers process claims for the New York's government employee health plan, known as the Empire Plan. The audits suggest that neither payer appropriately or effectively monitored provider claims. There were errors in 111 (57 percent) of the 194 claims in Empire review sample, resulting in a net overpayment of $387,772 for the sample, according to the audit.

In the UHC audit report, the reviewers stated: "For 27 (12.6 percent) of the 214 claims we tested, a significant and separately identifiable E/M service was not provided. On one claim, for example, United paid a provider $561 for a lesion removal and another $204 for a purported E/M service. However, there was no indication in the medical records that a significant and separately identifiable E/M service was, in fact, provided. Thus, the provider should not have billed (and United should not have paid) the additional $204 for the E/M service."

"While most New Yorkers are watching their spending, Blue Cross Blue Shield and United HealthCare are not monitoring bills and are letting the state overpay health providers," said NY comptroller Tom DiNapoli. "An error rate showing that nearly 6 of every 10 claims are billed incorrectly is simply unacceptable and cannot continue."

You can review the Empire audit at http://www.osc.state.ny.us/audits/allaudits/093012/10s74.pdf and the UHC audit at

In March, Excellus Blue Cross Blue Shield (BCBS) settled with the New York attorney general, agreeing to process refunds for incorrectly denied childhood lead screening tests. The refunded amounts will also include interest.

"This settlement puts health insurance providers on notice that unlawful denials of mandated insurance coverage will not be tolerated by this office," said New York Attorney General Eric Schneiderman, according to the Utica Observer-Dispatch.

The NY AG's office received Excellus member complaints that stated the payer was denying coverage for the lead screenings, which are required by NY state law. The AG investigated claims from 2009 to 2011. Since the payer denied the charges, practices then either billed the patients directly or wrote off the charges.

As part of the settlement, Excellus will re-process the lead test claims, after fixing the claims systems errors that caused the denials, and will then refund the out-of-pocket costs, plus 12 percent interest, to members.