Medicare:

Concerns With Physicians at Teaching Hospitals (PATH) Audits

HEHS-98-174: Published: Jul 23, 1998. Publicly Released: Aug 12, 1998.

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Pursuant to a congressional request, GAO reviewed the Physicians at Teaching Hospitals (PATH) initiative, focusing on: (1) whether the Department of Health and Human Services' (HHS) Office of the Inspector General (OIG) has a legal basis for conducting PATH audits; (2) whether the OIG has followed an acceptable approach and methodology in conducting the audits; and (3) the significance of the billing problems identified in selected audits.

GAO noted that: (1) in GAO's opinion, HHS' OIG does have a legal basis for applying the specific criteria used in the PATH initiative; (2) the need for a teaching physician to be physically present to bill for services performed by residents is a longstanding requirement of Medicare; (3) the fact that a physical presence requirement has not always been consistently communicated or enforced does not obviate the need for teaching physicians to document their personal involvement in services to legitimately bill Medicare; (4) although detailed guidance for documenting evaluation and management codes was not effective until 1996, the definitions of these codes and instructions for their use have been available since the codes were implemented in 1992 and provided the standard for the PATH initiative; (5) OIG's methodology on the three audits GAO reviewed was reasonable; (6) the criteria OIG used to assess teaching physicians' involvement in services performed by residents were consistent with statutory and regulatory requirements; (7) the criteria used by OIG were no different from the information already provided to the teaching hospitals by their carriers; (8) GAO saw no evidence that OIG or the medical reviewers applied documentation guidance when assessing the level of teaching physician care billed to Medicare during the prior periods covered by the audits; (9) the results of one of the audits examined raises questions about OIG's original intent to audit all major teaching hospitals; (10) auditing every major teaching hospital would be time-consuming and expensive for OIG, the carrier, and the institutions involved; (11) a risk-based approach focusing on the most problem-prone institutions would be a more efficient use of these resources; (12) OIG reduced the number of institutions to be audited, due to competing demands and other factors, but neither its original intent nor its recent decision to reduce the number of audits used a risk-based approach; (13) a substantial difference existed between the billing errors identified by OIG and the amounts the institutions ultimately agreed to repay; and (14) in essence, the Department of Justice used OIG's audit results related to inpatient services for a single year to estimate potential false claims for all Medicare part B services for multiple years.

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