CPT Coding and Medicare Audits

by Chester W. Schmidt, Jr., M.D.

[Spring/Summer 1998; Vol. 25 No. 1]

By now, we are all aware that the current administration has given the Justice Department its marching orders to clamp down on alleged Medicare fraud and abuse. The recent suit by the government revealed Medicare paid out $20 billion “inappropriately” to all providers: hospitals, health care professionals (including physicians), home health care agencies, durable medical goods businesses, and nursing homes. The dollar figure was down from $23 billion a year ago and the term “inappropriate” covers Health Care Financing Agency errors and provider errors as well as fraud and abuse.

Psychiatrists from different parts of the country are reporting to the APA that they are being subjected to audits for a variety of reasons. The Office of the Inspector General has published “Fraud Alerts” which focus on the incorrect use of the old interactive individual medical psychotherapy code (90855) now (90810-90815 and 90823-98029), upcoding psychotherapy codes (coding 45-50 minute for services of 20-30 minutes), coding and charging for individual psychotherapy (90804-90829) and psychopharmacologic management (90862) on the same day, and finally exclusive use of the old individual psychotherapy code (90844).

The attorney general’s office has added to our concerns with audits to determine the adequacy of documentation for coding of the level of evaluation and management services billed to Medicare. Psychiatrists principally use E/M codes for hospital inpatient services (99221-99239), consultations (99241-99263), and nursing facility services (99301-99316). In 1995 and again in 1997, HCFA and the AMA published documentation guidelines for E/M codes. The 1997 guidelines were to be effective July 1, 1998, but outcries voiced by physicians all over the country resulted in an indefinite delay in implementation of the 1997 guidelines pending major revisions. It is hoped that the revisions will simplify, streamline and make the guidelines more user friendly. The APA, as are all specialty societies, is providing recommendations to the AMA for changes in the guidelines. In the meantime, physicians have the choice of using the 1995 or 1997 guidelines until revisions are complete. The main difference between the 1995 and 1997 guidelines are the addition of single system examinations (including one for psychiatry) in the 1997 guidelines. The single system examination for psychiatry is a distinct advantage for us as practitioners because we do not have to do multi-system examinations as a component of a psychiatric evaluation when using the E/M codes.

What is the poor practitioner to do to stay out of audits and harm’s way?

• Buy a CPT 1998 Manual from the AMA and read it. The relevant sections are pages 1-43 and pages 351-353.
• Buy a copy of the July 7, 1997, Volume 7, No. 7 issue of the CPT Assistant published by the AMA titled “Documentation Guidelines for Evaluation and Management Services” and read it.
• Always use the code that best fits the service provided the patient.
• Document the services you provide patients whether on inpatient units or in your office. The documentation requirements for E/M services are very specific (see CPT Assistant, July 7, 1997). Documentation requirements for psychiatric services, including psychotherapy, are yet to be standardized; your office note should include the following:
  • date of service
  • length of service
  • type of psychotherapy
  • short description of goals attained during the session
  • medications
  • side effects of medications
  • a legible signature

• Stay away from interactive codes unless you are a child psychiatrist. If you use the codes, you must document the medical necessity for using the code.
• Do not get creative with codes—a few dollars extra is not worth an audit.
• If you have doubts about your mode of practice and coding, especially with Medicare patients, call the APA (202) 682-6039 and/or the Medicare local carrier for clarification before you start billing for service.
• To become a real expert, buy the second edition (out in several months) of the CPT Handbook for Psychiatrists, American Psychiatric Press, Inc.

The documentation guidelines can be downloaded in WordPerfect 6.1 from web site www.hcfa.gov. medicare/mcarpti.htm.

Dr. Schmidt is professor of psychiatry at The Johns Hopkins University School of Medicine and chair of the APA Work Group on Codes and Reimbursements.