On the heels of two similar settlements, a Baltimore health system has settled a case for $122,928 in which it was accused of getting the doctors whose practice it had acquired to bill their established patients as if they were new, inflating their charges.
Whistleblower Jonathan Safren, M.D., will receive $20,000 in the settlement of United States ex rel Jonathan Safren v. St. Agnes Healthcare, which charged presentation of false claims and creation and use of false records.
The alleged substitution of new outpatient E/M codes (99203-99205) for established patient codes (99213-99215) is reminsicent of two settlements of similar charges in July against UMass Memorial Medical Center and Boston Medical Center (BMC), which together coughed up more than $700,000 to the Office of Inspector General (OIG).
According to the original complaint filed in U.S. District Court for the Northern District of Maryland in July, St. Agnes, itself part of the Ascension health system, acquired MidAtlantic Cardiovascular Associates, a 12-provider cardio practice, in 2011.
Safren claimed that St. Agnes' compliance director "in knowing violation of the governing CMS guidelines, directed the cardiologists to bill the next office visit made by each of their established patients under the CPT code for a new patient visit, regardless of whether the patients had been seen by the physician in the previous three years," the complaint said.
Safren, one of the cardiologists, claimed he'd pointed out this violation to the compliance director but she "dismissed his concerns," the complaint said. Safren left St. Agnes in 2013.
The complaint cites the AMA CPT Manual, the Medicare Claims Processing Manual and "the 'Frequently Asked Questions' section of the CMS website" on the difference between new and established patients and explains that new patient codes are reimbursed at a higher rate than established patient codes because of "the additional time spent on a comprehensive examination and history." It also notes that the takeover by St. Agnes "did not affect the physicians' relationship with their patients in any way."
The complaint also mentions that the cardiologists got productivity bonuses based on their relative value units (RVUs), which "thus incentivized the members of the Maryland Cardiovascular Associates to increase their RVUs. ... When a Maryland Cardiovascular Associates physician billed an established patient under billing codes reserved for new patients, the physician was eligible to share in a portion of the enhanced fee that was generated by the mis-classification."
When Safren objected to this scheme in a meeting of the cardiologists and the compliance director, the complaint goes on, "three or four" of his colleagues argued to him "that billing for existing patients as if they were new patients would help the Maryland Cardiovascular Associates attain its productivity bonus."
In fact, four of Safren's colleagues told him they were continuing to use the new patient codes for their existing patients and one of Safren's colleagues told him his refusal to do likewise "didn't help your production numbers," per the complaint.