Billing spikes tied to increased use of electronic medical and billing records.

The New York Times recently reported that “Medicare bills rise as records turn electronic”. Find the story here.

As reported, the issue is this: “When the federal government began providing billions of dollars in incentives to push hospitals and physicians to use electronic medical and billing records, the goal was not only to improve efficiency and patient safety, but also to reduce health care costs. …But, in reality, the move to electronic health records may be contributing to billions of dollars in higher costs for Medicare, private insurers and patients by making it easier for hospitals and physicians to bill more for their services, whether or not they provide additional care.”

The article cites Medicare data to suggest that hospitals are using EHRs to exaggerate the scope of work that doctors provide, in an effort to increase their reimbursement rates. This practice, known as “upcoding” was also examined by the Center for Public Integrity earlier this month, focusing on hospital emergency room billing. Find that report here.

As reported, here are some of the data related to hospital billing: “Over all, hospitals that received government incentives to adopt electronic records showed a 47 percent rise in Medicare payments at higher levels from 2006 to 2010, the latest year for which data are available, compared with a 32 percent rise in hospitals that have not received any government incentives, according to the analysis by The Times.”

It’s also noted that the “most aggressive billing” can be found in practices and services specializing in family practice, internal medicine and emergency care, accounting for about 1,700 of the more than 440,000 doctors in the country – and according to the Inspector General of the Department of Health and Human Services, representing “as much as” $100 million in Medicare payments in 2010 alone. Find the IG report here.

As reported by Politico, the Department of Health and Human Services (HHS) and the Department of Justice (DOJ) have sent letters to five major hospital groups to warn against using EHRs to “game the system”. The letter stated that the government would “not tolerate health care fraud” and that “law enforcement will take appropriate steps to pursue health care providers who misuse electronic health records to bill for services never provided.”

But as reported by the Center for Public Integrity: “Dr. Donald Berwick, the immediate past administrator of the Centers for Medicare and Medicaid Services (CMS), which administers the Medicare program, said a small portion of the billing increase is likely caused by outright fraud, but in the majority of cases hospitals are legally boosting profits by targeting the vulnerabilities of Medicare’s payment system. “They are learning how to play the game,” Berwick said about the hospitals.”

In its story, “Hospitals: Feds share billing blame”, Politico reports that among the targeted groups, the Association of Academic Health Centers responded that the problem is that the government has failed to provide adequate guidelines on billing for some of the most common practices, even after requests have been made for such guidance – guidance hospitals have asked for.

Politico also reports that “Both the AHA and AAHC also complained about Medicare Recovery Audit contractors, which the Centers for Medicare & Medicaid Services hire to review billings. The so-called recovery audit contractors have long been accused of being overzealous, in part because they are paid a percentage of improper payments that they identify, even if those payments are reduced or overturned on appeal.”

The full story from Politico can be found here.