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January 2006

Savvy Coder: Coding & Reimbursement

The Office of Inspector General Names the Priorities for Its 2006 Anti-Fraud Campaign
By Sue Vicchrilli, COT, OCS, Academy Coding Executive, and
David W. Parke II, Senior Secretary for Ophthalmic Practice

On Nov. 16, the Department of Health & Human Services (HHS) published its new Office of Inspector General Work Plan. In this, the OIG identifies programs and activities that it intends to scrutinize during fiscal year 2006.

The OIG’s plan includes six areas of investigation that will be of particular interest to Eye M.D.s.

Billing service companies. The OIG will once again review the relationships between billing companies and the providers who use their services. In this investigation, the OIG will 1) identify the types of arrangements physicians and other Medicare providers have with billing services and 2) determine the impact of those arrangements on the providers’ billings.

Medicare payments to VA physicians. Physicians employed by the Department of Veterans Affairs (VA) may not bill Medicare for services rendered at one hospital during the times they were on duty for the VA at another hospital. Preliminary work has identified a number of VA physicians who received Medicare reimbursements totaling $105 million for services rendered between the beginning of January 2001 and the end of June 2003. The OIG will vet the validity of Medicare reimbursements for services billed by physicians who also report being on duty at a VA hospital.

Ordering physicians who are excluded from Medicare. The OIG will check the extent of services ordered by physicians who have been excluded from federal health care programs and the amount paid by Part B. Federal regulation generally precludes physicians who are excluded from federal health care programs from ordering or performing services for Medicare beneficiaries.

Physician pathology services. The OIG will investigate pathology services performed in physicians’ offices.

Medicare pays more than $1 billion annually to physicians for pathology services, and the OIG wants to determine if the billing for those services complies with Medicare Part B requirements. The OIG will identify and review the relationships between physicians who furnish pathology services in their offices and outside pathology companies.

Initial preventive physical exam. The OIG will look into billings for this new exam to ensure that payments aren’t being made for services that had already been performed in a past evaluation and management visit.

Part D prescription drug benefit. The OIG will also focus on the new Part D prescription drug benefit that went into effect on Jan. 1, 2006. Its inquisitional activities will include:

  • Tracking beneficiaries’ true out-of-pocket costs for Part D prescription drug coverage.
  • Checking that marketing materials for prescription drug benefits are in compliance with CMS regulations and guidelines.
  • Measuring pharmacy access in rural areas.
  • Determining whether there is sufficient coordination and oversight to avoid duplicate payments.

There May Be a Rain Check
The OIG is still scrutinizing HHS programs that were set up to provide relief for those individuals who were affected by Hurricane Katrina and Hurricane Rita.

Because the OIG shifted some of its resources to that effort, it warns that some of the projects in the 2006 OIG Work Plan may be delayed until 2007.

Further Reading
To read the entire 67-page OIG Work Plan, go to and select “Publications.” For more information on the Part D Prescription Drug Benefit, AAOE members can read the October issue of their Techniques newsletter at