Medicare: Using Education and Claims Scrutiny to Minimize Physician Billing Errors

In its audit for year 2001, the Department of Health and Human Services' Office of Inspector General found that $12.1 billion was improperly paid to Medicare providers. GAO's February report (GAO-02-249) showed that physicians often do not receive complete, accurate, clear, or timely guidance on Medicare billing and payment policies. At the carriers studied, GAO found significant shortcomings in printed material, web sites, and telephone help lines used to provide information and respond to physicians' questions. GAO concluded the Centers for Medicare and Medicaid Services (CMS) needed to initiate a more centralized and coordinated approach and provide technical assistance to carriers to improve provider communications. In fiscal year 2001, CMS revised its policy on conducting medical reviews. The policy directs carriers to differentiate among levels of billing problems and tailor corrective actions accordingly. As a result of this and other medical review modifications, the highest overpayment amounts assessed a physician practice by a carrier dropped substantially.