Federal Audits of E/M Services

Michael Calahan, PA, MBA

October 2011, Vol 1, No 3 - Reimbursement

It is no secret federal auditors promise to assail providers through a variety of strong recoupment initiatives. Evaluation and management (E/M) services are primed for this offensive. No longer able to report consultation codes to the Centers for Medicare & Medicaid Services (CMS), oncologists must improve E/M reporting strategies for routine cognitive services, such as office visits and inpatient hospital visits. This increases the impact of E/M services on practice revenue and elevates these mundane services to “juicy” targets for federal programs such as the Comprehensive Error Rate Testing and Recovery Audit Contractor initiatives.

What should oncologists do in the face of this scrutiny? Start by learning which audit findings yield valuable opportunities for clinical documentation improvement as well as stronger E/M coding. Here are my “Top 10” audit findings together with survival tips.


1   No response to additional documentation requests (ADRs). Most often, physician services are downcoded or denied by auditors because of no response to ADRs.

Survival tips:  Every provider office should log the receipt, track the processing, and confirm the fulfillment of these medical record (MR) requests to avoid unnecessary repayments.


2   Unsigned, illegible, or indeterminate MRs. Unsigned MRs, illegible provider signatures, and/or the inability to differentiate ancillary staff notes from treating provider notes account for a preponderance of audit findings.

Survival tips:  Change Request 6698 (March 1, 2010) requires legible signatures to certify services; illegible signatures submitted without signature logs/ attestations are adjudged as “indeterminate,” and equated to unsigned documentation. Mixing ancillary staff notes in the body of the clinical note without signature clarification is tantamount to uncertified records. Providers and ancillary staff must each sign/date clinical note contributions, thereby clarifying authorship. Excluding certain hospice notes/orders stamped signatures are not valid.


3   Review of systems (ROS) missing or poorly documented. Recording the history portion of E/M services is the weakest area of provider documentation. Within the history, the most overlooked element is the ROS that, when poorly documented, severely limits the level of E/M service legitimately billed.

Survival tips:  Have ancillary staff obtain the ROS; providers should verify and authenticate these data. If obtaining on a separate questionnaire, “bridge” these data to the actual visit notes.


4   Poor documentation for E/M code Current Procedural Terminology (CPT) 99211. CPT 99211 is designed for minimal problems requiring “quick” visits carried out by ancillary staff, supervised by the treating provider. Adequately substantiated in the MR documentation, CPT 99211 can be reported for myriad services.

Survival tips:  CPT 99211 represents a true E/M service; therefore, the MR documentation must convey both evaluation and management facets. Because a CPT 99211 service is typically furnished by ancillary staff under the provider’s direct supervision, CPT 99211 is reported as “incident to” and the provider must certify the chart notes.


5   Misapplication of modifier 25. Modifier 25 is reported with an E/M service when significant, separately identifiable services are rendered by the same physician on the same day of a procedure or other service. Common problem areas include: (a) modifier 25 incorrectly reported with a non-E/M service, for example, CPT 93000 to 93025 for EKG; and (b) modifier 25 reported with an E/M code when the patient presented solely for a prescheduled minor procedure, for example, joint injection.

Survival tips:  Modifier 25 is designed to allow certain E/M services to bypass system edits. Without proper usage, the Medicare carrier may impose claimsdelaying prepayment screens and documentation reviews.


6   Time used as the key component for the E/M service. Providers can report noontime-based E/M services using time as the key component (instead of the 3 key components of history, physical examination [PE], and medical decision making [MDM]) when counseling and/or coordination of care constitute 50% or greater of the total face-to-face time; however, auditors find no times documented in the MRs.

Survival tips:  Document 2 strata of times when using this option: (1) total face-toface time for the entire encounter; and (2) total time spent in counseling and/or coordination of care. Content of the counseling/coordination of care must be documented.


7   “4×4 rule”: expanded problem focused (EPF) or detailed examination? Confusion surrounds these specific examination levels because the official documentation guidelines (DGs) are ambiguous for both levels by stating they must contain “2 to 7 elements.” This causes provider misinterpretation and results in audit findings of “insufficient documentation for detailed exams.”

Survival tips:  Know the “4×4 rule,” which comprises 4 PE elements examined in 4 body areas/organ systems (fully documented). For providers, this rule is a quick method to avoid misinterpretation; for auditors, it allows efficient assessment and exact PE-level differentiation. Providers should check with their Medicare carrier to ascertain the DGs for EPF and detailed PEs.


8   Misreporting of CPT 99499 (unlisted E/M service). CMS addresses CPT 99499 in the Medicare Claims Processing Manual 100- 04 Chapter 12§30, stating “the Carrier has the discretion to value the service” coded with CPT 99499. The carrier is in control, and many carriers maintain that CPT 99499 should be reported only rarely. This is because adjudicators must review documentation and apply individual consideration protocols for correct pricing.

Survival tips:  Report CPT 99499 in rare circumstances and only per your carriers’ instructions.


9   Misapplication of modifier 24. When reporting unrelated E/M services during the global surgical period of a major procedure (90 days) or of a minor procedure (up to 10 days), the MR documentation must support the E/M code appended with modifier 24. MR documentation must detail why the service should be allowed outside the global period.

Survival tips:  This is one of the few E/M areas regularly on the Office of Inspector General Annual Work Plan. Implement steps to prevent inadvertent reporting of E/M services included in the status post convalescence: careful documentation and ICD-9-CMcoding are essential.


10   Key components of E/M services not fully documented or missing. For most E/M services, 3 key components govern code selection: (1) history; (2) PE; and (3) MDM. These components must be included in the documentation for new office visits and initial inpatient services. If only 2 key components are required to be documented, for example, CPT 99212 to 99215 or CPT 99231 to 99233, at least 2 components must meet the service’s lowest thresholds.

Survival tips:  Error 1—History: Poorly recorded data including chief complaint (CC); history of present illness (HPI); and past medical, family/social history (PFSH). Contradictory data among these elements are also a common error, for example, CC states one reason for the visit but the HPI details a different problem. Some carriers require the CC and HPI to be documented by the treating pro vider only. Terms such as “noncontributory” under the PFSH or ROS may be invalid; know your carrier’s preferences.

Error 2—PE: Missing or insufficient information. A common PE statement is “no change from prior visit,” but when 3 key components are required, this brief statement is inadequate. “Negative” and “within normal limits” notations are acceptable forms of documentation for unaffected areas/organ systems only.

Error 3—MDM: Truncated or disorganized data. MDM information conveys the complexity/risk of the service and therefore must be fully documented. Disorganized MDM data can cause mistakes in copying the requested MRs. Providers should always create a data bridge between the body of the visit text and other supporting visit documents such as an ROS questionnaire. Data bridges are critical when the provider has reviewed old MRs, ordered tests/ studies, carried forward or revised diagnoses and medications, etc.