The Sudden Increase in Medicare Denials and Documentation Requests

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Tom Necela of reports on the sudden increase in Medicare denials and documentation reqeusts.

So many, MANY chiropractors want to know the same thing:

“Why the sudden increase in Medicare denials?”

“What happened? This past week we got flooded with 67 requests for documentation!”

“Are we doing something wrong? We received over 50 requests for detailed notes in one batch!”

Medicare’s New Effort to Keep (or Take) Your Money

Maybe some of these chiropractors are doing things wrong, maybe some are not. Either way, though, the increase in claim scrutiny is a planned, targeted effort launched by Medicare in an attempt to stop fraudulent claims and improper payments before they happen.

A $71 Million contract was awarded to the Northrup Grumman Company to spearhead the “Predictive Modeling” project which began in July 2011.  According to a study done by the Lewin group, this new approach may save Medicare a potential $40 billion over the next four years.

Predictive modeling is not necessarily new; banks, insurance companies and corporate efficiency experts already employ such techniques to find potential fraud or maximize production. But the application to healthcare is unique – and not without controversy.  The Centers for Medicare and Medicaid Services will apply the experimental investigational process to all new Medicare fee-for-service claims beginning July 1, 2011.

The “predictive modeling” approach will use risk-scoring tools to analyze claims as they come in and, in theory, stop them in their tracks before Medicare pays out. With the help of algorithms, Medicare contractors will analyze claims and flag possible problems by assigning them risk scores and “alerts.”

Already the American Medical Association has emerged as a vocal opponent.  In a letter dated August 8, 2011 the AMA “strongly urge[d] CMS not to use the program to identify improper payments unrelated to fraud.

How does this affect chiropractors?

  • Do not be surprised if you start getting a proliferation of requests for documentation.
  • If the number of requests is exceedingly large (depending on your carrier, typical requests consist of only 10-12 patients) you may have been selected for the predictive modeling program.
  • This means that your claims are being flagged for unusual patterns in respect to your peers or in respect to Medicare billing regulations

Examples of why Medicare’s Predictive Model can flag you as a chiropractor:

  • Billing for more than one adjustment per day (repeat procedures)
  • High volume chiropractors who submit many claims to Medicare
  • Chiropractors who have a large percentage of their practice as Medicare
  • Chiropractors who treat their patients very frequently or for a long time
  • Improperly billing Medicare for non-covered services

The “Unfair” Reality of Predictive Modeling

Obviously, most of you can see the shortcomings in this method when applied to chiropractic.  Certainly, one can understand that if Medicare will only cover one surgical procedure (or one adjustment) per day, then it would be easy – even effective — to try and catch those who were breaking the rules.  Similarly, billing Medicare for services that you know Medicare doesn’t cover for chiropractors is not the brightest idea either.

But Predictive Modeling is not needed to catch these offenses.  Claims edits and other flags should already do this job.

Where the playing field is not level is when the predictive modeling program is applied to chiropractors who just look “different.”  Take, for example, the DC who treats a patient for a long time or sees a lot of Medicare patients.  Sure, statistically he will look differently than other DC’s – but that, in and of itself, does not mean he has done anything wrong.

The Dangers of Being “Different”

Read the rest of this story at


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