Medicare made the rules and now punishes doctors for following them

I wanted to expand on something I wrote recently, which relates to my other sort-of-recent post on upcoding. I wrote, about scribes and compliance:

Knowing that the scribe cannot document a complete ROS unless I actually did that ROS, I am more compulsive about making sure I hit all ten systems. (Even when it’s not clinically relevant. Such is the Kafkaesque world we live in.) And I make sure to do a full exam where before I may have elided over a few systems. This is, of course, only for cases where the complexity of the case will justify a service level requiring the complete H&P.

This hits at the heart of the upcoding debate. Remember this front-page article in the New York Times, in which the increased billing levels of ER doctors is asserted as prima facie evidence of fraud and abuse, and the follow-up in which the powers that be asserted their intent to reclaim these hundreds of millions of dollars in “inappropriate payments.” We are not looking at a hypothetical threat here, and the financial risk to care providers is enormous.

The rules, for those not familiar with them (and who the hell would be reading a blog post about medical coding if you weren’t?) are that to bill at a level 5, which is the highest ordinary level of service in the ER, the physician must document the following:

  • An extended history
  • A complete review of systems
  • A comprehensive exam
  • High complexity medical decision-making

In order to quality for a level 5, all of these must be met, but the sine qua non is the medical decision-making (MDM). This is, in fact, the ultimate driver of the visit level. MDM consists of three components: the number of diagnostic options (i.e. your differential), the amount of data you must review (i.e. tests, re-examinations) and the risk inherent in the presenting problem. If the MDM isn’t met, no matter how nicely documented the rest of the chart is, a high service level may not be justified. To put it another way, an ankle sprain, no matter how thoroughly documented, is still just an ankle sprain.

Previously, it was common to have cases “downcoded” when a doctor had a high-complexity MDM but slipped up on the other items, most commonly on the ROS. Over the years, physicians have gotten better educated about the system and more sophisticated at making sure the ROS and other requirements have been met so that the billing level can, appropriately, be determined by the MDM.

This rankles. Always has. When I see a patient with chest pain and a heart attack, in order to get paid appropriately I have to ask a bunch of completely irrelevant questions about unrelated systems: do you have burning when you urinate? Do you have any rashes? Nobody would argue that the complexity and risk don’t justify the level 5, but I have to document a bunch of medically unnecessary trivia to compliantly bill at the level the MDM deserves.

And this is where the bureaucratic hassle now becomes a catch-22.

“Medical necessity.”

Medicare considers it fraud to bill for things which are medically unnecessary. If I see an ankle sprain and order blood tests and a CT scan to try and get the bill up to a high level, that legitimately is fraud because the tests ordered are not medically necessary. But what is happening now is that Medicare (in the form of the private contractors who administer it regionally, along with some private payers) are reviewing charts and claiming that the physicians are fraudulently upcoding because we are documenting complete Reviews of Systems when they were not … wait for it … medically necessary.

To be clear: Medicare set the rules, and made them arbitrary and disconnected from reality, and now is coming back and punishing physicians for attempting to follow the rules to the letter of the law.

And the format this takes is scary. You get a letter from the Medicare carrier (or a RAC or a Medicare Advantage administrator) telling you that you’ve been reviewed, found guilty of upcoding, and this finding, based on a handful of charts, is extrapolated back several years. The result is a large demand for reparations, usually in the mid-to-high six figures. The physician group can either write a check or lawyer up and argue it chart by chart in front of an administrative law judge.

What I hate about this is the underlying dishonesty. This is about saving money. I get that, and that is in fact a reasonable goal. Healthcare is astoundingly expensive, and as a society we need to ratchet back the expense. If there’s an argument to be made that physicians are paid too much, then let’s have that debate on its merits. But the attempt to save money by harassing physicians and exploiting the contradictions within the rules that the government itself wrote is beyond maddening.

“Shadowfax” is an emergency physician who blogs at Movin’ Meat.

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  • RHR_Chat

    The saddest part is that the elderly do not get care because doctors don’t want to treat Medicare patients (beyond necessity like ED). What is curious to me is that docs have a powerful lobbying group – AMA. And then there’s AARP and its lobbying. Perhaps the real, baseline goal is to stop treating the elderly. That would fall beautifully with the goals of ObamaCare. The federal govt does not want the elderly to get medical care. As doctors, you must recognize that “possibility.”

    • Steven M Hall, MD

      The AMA may be a powerful lobbying group but they don’t lobby for the physician in billing matters. The AMA promulgated the criteria that all the insurance companies are using to cut us off at the knees and they make most of their $ by selling us the coding books. Physicians need our own union to go up against the insurance industry on matters of post-payment audits. We need to get organized!

      • Suzi Q 38

        Dr. Hall, you are so right.
        As a patient, I need you to get paid a decent wage for helping us.
        For example, our teacher’s union is so strong.
        You need a union that is that strong, with dues to back it up and fight for what is right, because it affects us.

        • purplewings

          Oh yeah, let’s get some more unions in there to raise costs even more for the people! WOW! You’re one selfish human being to even suggest that! Wherever there are unions, there are lousy workers who don’t give a darn about anyone. That’s why students grow up ignorant now. Teachers keep their jobs no matter how miserably they teach. If Doctors do that, there will be bodies everywhere and the profession will become all about money instead of helping people. Even auto factories with unions keep their products higher priced for the public because they need to cover all the bad workers and waste brought on by incredibly bad workers with union guarantee that they will always have a job. The non-union public pays the bills!

          • Duderino

            There’s nothing wrong with healthcare that a free market couldn’t solve.

          • Suzi Q 38

            My point is not a union in the sense of a regular union.
            My point is that if a band of teachers can get together and get so much done, why can’t doctors?
            You are all complaining understandably, but no action.
            Things are going to change drastically, if your concerns are not heard.

          • purplewings

            Thank you for your explanation. Maybe the better word would be to Unite? Which as Americans, we should all be doing, as we will all suffer in the end.

          • Suzi Q 38

            It may mean that more doctors UNITE and decide what is best for you. That accepting Medicare payments that are less than the hourly rate of a hairstylist or plumber with out any advanced degree just isn’t’ right.

          • dufas_duck

            Have you seen what a plumber earns lately????

          • dufas_duck

            We need more $100,000.00 a year hub cap installers and windshield washers….. only the doctors should get basic wages…

  • Margalit Gur-Arie

    I don’t know if this helps (it’s from the CGS MAC), but you don’t have to have a comprehensive ROS necessarily for a level 5, if you have a comprehensive HPI and a high complexity MDM. May not have to write that check after all… :-)

  • Docbart

    You don’t understand. Medicare wants docs to provide more care for less money. It’s as simple as that. If you try to get paid what you think you should get paid, then it’s wrong by them- you committed fraud. Medicaid, on the other hand, doesn’t seem care much what you do to get paid adequately. They just pay so little anyhow, it’s not worth fighting over, unless you claim to have seen a whole lot of patients that you never saw.

  • janysboy

    As a Non-Physician,( I’m a respiratory therapist and clinical perfusionist), I see the problem as non-medically trained people (Lawyers, Politicians, political hangers-on) trying to write the rules to cover an area in which they have no expertise; ie. medicine. Because of their lack of expertise and their own hubris they NEVER forsee all the consequences of the laws and regulations they write. Because of their hubris, they believe they can write new laws which adequately address the problems caused by the old laws. Now we see the truth of the adage, ” Insanity is doing the same thing over and over and expecting different results.”
    The only way out of this I see, (and again I am not a physician) is for ALL people involved in healthcare to support organisations devoted to smaller government on all levels. The Tea Party and the Libertarian Party (neither of which I belong to btw, have to do something about that) are two organisations which I could recommend as devoted to smaller government.

    • Kobukvolbane

      It’s not smaller government, or bigger government, it’s more effective government. Libertarianism is great for people who are doing well–for those who need our care, not so much.

      • James Payne

        Progressivism (aka LIBERALISM aka SOCIALISM) is Lousy for both people who are well off and those who are not…it is ONLY good for those who are politically connected…PERIOD.

        • Kobukvolbane

          Do you work for the government?

          • Enrique

            A subsidized safety net is one thing. But take the free market out of medicine and centralize it from afar, and everyone, *everyone* will have less except the politically connected. (Take a look at Congress’ health plan – funny, it’s a little bit richer than Medicare.) It’s simple economics and human behavior.

            If people are allowed as individuals to look after their own business – doctors, patients, everyone – with reasonable protection from fraud and coercion – they can make “progress” via intelligent decisions that are right for them, in their own situations.

            When centralized committees try to run everything, it doesn’t matter how much they care or how much they study, they end up with incredible inefficiency and waste and the centralize path of money is inevitably tapped by leaches who position themselves to do so. Oversight of a huge system like that is very difficult, as this post points out. Fraud detection is reduced to statistical farce.

            And what’s worse, people get forced to do things they shouldn’t have to. Can’t pay a little extra for a better doctor. Can’t have certain treatments. People who think it’s terrible when an insurance company denies procedures are more comfortable with bureaucrats that are facing massive budget crises? Hmm.

            And look at the state of medicine now…do you think there are so few carriers wielding so much clout because there are lots of regulations and mandates, or a few, reasonable ones that allow consumers to balance costs and benefits? Hint: It’s incredibly regulated, and in some states there are very few carriers.

            “Libertarian utopia” is an oxymoron, of course. Libertarians desire freedom and fairness, and know happiness may be enabled by the government, but never planned by the government. It doesn’t mean they are against subsidies for the poor. But a useful subsidy is one they get to spend on the provider they choose, enhance with additional personal funds, or keep for the future – that’s what incentivizes intelligent and efficient decision-making. Setting up a central-payer system and *price caps* creates perverted incentives and inefficiency that hurts everyone all the way down. If you truly put yourself in the shoes of every party involved, you’ll understand that centralization is not the answer for something as personal and complex as health care.

          • Kobukvolbane

            You may be surprised I agree with a lot of what you say. Your opinions seem to be nothing like those of the person I originally responded to.

          • Enrique

            Glad we agree! :) I think regarding James Payne’s comments, it really depends what each respective person reads into the meaning of “progressivism”. I personally believe that the end result of highly centralized systems leads to only the well-connected having much of anything and the poor being that much worse off, and this is inevitable in a large society. The USSR is an extreme example. The UK is a counter-example, but they are economically liberal and decentralized in most facets beyond healthcare.

            If by “original” you mean janysboy’s support of smaller government, I guess I don’t see the difference. I believe in a government that’s as small as possible. One that only performs the functions that would be impossible or worse if they weren’t centralized – law enforcement to protect against cheating and force, common defense, things like that. Welfare, including medical subsidy and retirement backup, is a more complicated issue. Is it best performed by the federal government? Perhaps, it’s true that many states were negligent for a long time on this issue. On the other hand, the system we have is horribly designed, doesn’t properly protect the poor, and certain to require massive adjustment.

            I think a lot of people equate libertarianism and conservatism with no welfare, but nowadays it’s how the welfare is structured. Paul Ryan’s alternative to Obamacare was structured with a subsidy instead of these centralized mechanisms that are designed to end up as single-payer. It still had free medicine for the needy. It just let them make the spending decisions.

            Of course, I may be missing your point entirely… :)

          • Kobukvolbane

            Briefly: we forget that this country was founded upon, and thrived upon, libertarianism AND communitarianism. There has always been a tension between liberty (which we prize) and community (which we also prize.) I stand by my statement that effective government is what we need, not large or small government, and what you said sounds like exactly the same thing, just approached from a different angle. See, what’s important to me is equal opportunity for all. We can’t be perfect with that, but that’s one thing that centralized government can help with. I live in a state that gets more from the feds than we pay in. Even those who pay big money for taxes benefit from that. Money is money, and the money spent by the much maligned food stamp recipient is welcomed by supermarkets and convenience stores. Some people have a chip on their shoulder, saying they work for private enterprises, but surprise, suprise, that enterprise is, for example, the Portsmouth Naval Shipyard, and…well, that’s gummit money. Same with us in health care. A lot of our income comes from Medicare and Medicaid. We are all in this together, and the common good is not a communist plot.

            I’m not at all knowledgeable about health care policy. But I think local control–with federal oversight–could be very beneficial to health care, to welfare, and to education. It’s personal and that is good. I’m not sure this country is willing to do what it would take to really make a difference though. It would take a lot of money and a lot of effort. Now we just try to get people through the month and hope for the best.

            I could be missing your point entirely, too! I’m tired, I just finished a 14 hour shift, and my fingers are pretty much on their own, here, as I’m not sure how engaged my brain is at this moment.

          • Enrique

            Sounds like we all agree, but maybe have different conceptions of what “small government” means as a political movement these days. I take it to mean restricting government, especially federal government, to functions that are actually thought-out and useful and not trying to solve problems that can’t be solved properly by central control.

            I guess you could call it effective, perhaps logical. I like to call it “intelligent”, and like to think that someday we can decide which principles of oversight we are agreeing or disagreeing on, rather than “This seems like something I’d like fixed so let’s let the feds have a go at it regardless of unintended consequences, state alternatives (which allow up to 50 variations that can be studied and copied or rejected) or Constitutional restrictions.” One of my principles is that the federal government should only perform functions that would be ineffective or conflicting if delegated, such as a unified common defense, or international relations. I’m *pretty* sure the founders were on the same page, hence the limitations on powers in the Constitution.

            A lot of people act like the feds should do everything it possibly can, and state and local governments are only good for creating union jobs and maybe a few very specific local laws. These people DO NOT UNDERSTAND the founders on this issue. Period.

          • Kobukvolbane

            Does sound like we agree on the important things. And I do not tend to think of the founders as a bloc, but rather people who struggled, just as we do, to come to some kind of agreement. Thank you for a civil discussion.

  • Alison Manders Galvan

    The only answer is to Opt Out of Medicare, which we have done effective January 1.

    • margo

      Well done!! Happy New Year and I’m sure it will be if you don’t have to deal with medicare!!!!!!!!!!!!

    • Elegia More

      And what will you say when YOU are disabled or over 65 and can’t find a physician to treat YOU? Or your child on Medicare Disability passes away because she could no longer get continuity of care from a PCP, leading to death from dueling specialists?

      It’s time for us to mail flyers and post them at restaurants and such – a list of “physicians” that dump disabled Medicare patients that have been patients for ages…because they are BUSINESSMEN, not HEALERS.

      Perhaps we should start with Dr. Galvari

      • James Payne

        It’s time for EVERY physician to refuse Medicare…UNTIL the government wants to PAY physicians what everyone ELSE is paying.

      • TexasMom43

        Ah now there you have it. The trick is to tip-toe through the mine-fields in our unhealthy society and survive after age 65 and avoid the medical Obamacare community altogether (Until they begin the “mandatory” vaccinations for seniors on entitlements.

      • Alison Galvan MD

        I don’t kid myself into believing that there will be Medicare when I turn 65. And even “healers” have overhead and payroll to meet.

  • Beau Ellenbecker

    I hate ROS, its useless. Put the pertinents in the HPI and move on. I wish this was not a part of our billing

  • David M Sack

    The only answer as I see it is to do what I have done for years: spend more than half the visit on counselling and coordination of care. It’s usually necessary. The majority of my internal medicine visits do require extensive counselling, and I take the time to call up other doctors to discuss the patient’s problems and the consult notes I received. (It can be surprising how little of what the consultant advises was understood by the patient.). This way, at least I can bill for time spent on what counts. Too bad they are about to cut reimbursements by 1/4, which just about halves what I earn after overhead. They are practically encouraging physicians to click off boxes on our EMR’s just to earn 99214′s. I won’t do it. My internal medicine patients will be receiving counselling on how they can exercise their political influence if they want me to continue practicing internal medicine.

    • TexasMom43

      Be brutally frank with most patients once full Obamacare implemented.
      “Look here, your diet is killing you. Stay off wheat products and high fructose corn sweeteners and gmo products and you can reverse most of your problems – the diabetes, pre-diabetes, obesity, artherosclerosis, help yourself because I can only prescribe medicines that will cover your symptoms if the side-effects don’t kill you”

  • Pagan59

    Hey Shadowfax, how does that boot on the neck feel? Did you think that because you sport the MD that the government wouldn’t use you as the hatchet man? Obamacare is going to make physicians look like uncaring ogres because they won’t be able to afford to treat M-care or M-caid patients. You will be the focus of the blame. The government will blame your greed for not getting care to those people. How selfish is it that you want to make a profit when you should be treating people out of the goodness of your heart? Get used to it.

    • TexasMom43

      Physicians will participate in the genocide which according to an expert has eight stages:
      Classification Symbolization Dehumanization Organization Polarization Preparation Extermination Denial

  • Life X. Perience

    I feel sorry for you but you are now dealing with situations that other businesses and individuals have dealt with for years and no one seemed to be concerned with our plight. The government is intruding in all aspects of our lives and I’m not sure why the medical industry feels exempt.
    By the way are you not the blogger who has been an ardent supporter of Government Health Care in the past ?
    Welcome to the real world because “you ain’t seen nothin yet”.

    • TexasMom43

      God help us all – you’re right – we ain’t seen nothin yet. But poor Shadowfax! Nothing more conservative than a liberal who’se been mugged – right?

  • Sailor

    Have you changed your mind about Obamacare?

  • Pablo Romero

    “Brother, you asked for it.”

  • Cromulent

    These are just the wages of progressivism. Its not a bug but a feature.

    Didn’t this blockhead once write that Medicare is “the most successful government program ever.”?

    • TexasMom43

      Yep, he’s the very bird who chirped on and on about the virtues of Medicare……..

  • Les Aker

    It doesn’t “rangle”. It is just amusing. You were a big support of Obamacare, and all government operated medical services. Now you’re just getting what you wished for.

  • Howard Mirkin

    Any halfwit that looked at Obamacare from the beginning, and saw that Sebelius would be able to change it in just about any way she wants to for the three years after it was signed into law, should have knbetter than to support it.

  • Guest

    The edit function does not work, so I am reposting this one.

    Anyone who looked at Obamacare from the beginning, and saw that Sebelius would be able to change it in just about any way she wants to for the three years after it was signed into law, should have known better than to support it. All one had to do was to count the number of times the words “The Secretary shall” appeared. In some of the bills leading up to the passage of the law it was over 800 times. Shadowfax, you ain’t seen nothing yet!

  • Howard Mirkin

    Obamacare like almost every other government program tries to defy the laws of economics.

    The more people that need care (demand), the more expensive care will be(price) , unless there is more care available (supply). The government solution is to reduce the number of people who need care (demand) by reducing the amount of care they get (supply), i.e., reducing the number of doctors who treat them. The fewer the people there are in the country as a result of less healthcare, the lower the demand for healthcare, the greener the earth, the less polluted the earth will be, and the less carbon dioxide generated. So the government approach to solve all the imagined and real problems is to kill people by default (non-treatment), reduce the number of doctors by limiting the number who can survive in the profession, and let people die.

    It is all so simple. Are you awake yet Shadowfax?

  • RecordsDog

    As a student learning medical coding and billing, I can somewhat sympathize with Doc Shadow. Reading the CMS “guidelines” for assigning CPT codes is Kafkaesque in the extreme. AMA says “x”, but CMS says “not x”.
    While, hopefully, there will be a good job for me in coding and billing, I fear the Medical Police will, one day, haul me downtown to justify a 99214 from 30 years ago. Penalty: $1,000,000 fine and 10 years in jail for fraud. Because some doofus bureaucrat disputes the level of a ROS….

    • dufas_duck

      Actually, the real problem is that the system can make one guilty even if one is innocent.

  • OldSheepFarmer

    Shadowfax is finally getting the arbitrary and capricious nature of the government bureaucracy. Too bad that reality didn’t prevent him from supporting the PPACA.

  • Howard Mirkin

    The name of the program should be changed to Obamapare, because it is really designed to kill people.

    • James Payne

      Hummm…maybe Obamanasia? Obama euthanasia?

    • TexasMom43

      I bought every natural medicine book available the day after this monstrosity was passed. It is a license for the government to kill those who paid into social security all those years – they don’t have to pay your SS if you’re dead.

  • Duderino

    You made Spectator…congrats…

  • erehwon

    Hey, dude, weren’t you the poor schmuck who argued vociferously that Medicare was the finest government program ever instituted by man? Called all your buddies in the profession liars and fools?

    Do you have a good recipe for that big serving of ‘crow’ that you are now being forced to consume?

  • James Payne

    Hey Shadowfax,
    STILL like the idea of Obamacare? STILL support it? Yeah, didn’t THINK so.
    Well, TOUGH! YOU wanted it…YOU got it…and UNFORTUNATELY, those of us who were SMART enough NOT to want it are stuck with it TOO!
    ENJOY that WIN, Liberal!

  • noseitall


    So… you now have the situation where the government makes the rules.

    And the same government that makes the rules is the payer for medical procedures, and the reviewer of medical procedures.

    And it is in the government’s self-interest to minimize medical payments, regardless of the net effect on the patient or the doctor.

    Fortunately, the government’s actions can be appealed to… the government.

    Finally, the doctor or patient may sue by going to a court run by… the government, where the judge is paid by… the government.

    And the government can use your taxes to finance its legal disputes with you.

    What could possibly go wrong?


    • Alison Galvan MD

      Funny, if you ever call Medicare to ask for help with which code to use, they will not tell you. Sometimes we will get someone trying to be helpful and they will not give us the appropriate code, but will say “you’re getting warmer, warmer, now you’re hot!” But if you use the wrong code, that’s fraud.

  • noseitall


    So… you now have the situation where the government makes the healthcare rules.

    And the rules are enforced by… the government.

    And the same government that makes the rules is the payer for medical procedures, and the reviewer of “necessary” medical procedures. Seems like a small conflict of interest, doesn’t it?

    So it is in the government’s self-interest to minimize medical payments, regardless of the effect on the patient or the doctor.

    Fortunately, the government’s actions can be appealed to… the government.

    Finally, the doctor or patient may sue by going to a court run by… the government, where the judge is paid by… the government.

    And the government can use your taxes to finance your prosecution.

    What could possibly go wrong?


  • dufas_duck

    @ Shadowfax, MD, when one ‘pimps’ for a policy and then gets bitten in the tail by that policy, wouldn’t it be more correct to admit the mistake than whine and cry foul or is it in your mind that health care WILL be better served by political appointees and DMV like bureaucrats ??

  • Enrique

    Shadowfax, where is you’re public retraction and apology for defending Medicare and centralized medicine? :)

  • Diana A.

    Obamacare will kill us patients and run decent doctors out of practice. We patients are suffering from it already and its not even supposed to be in business til 2014! Medicare IS a good program, & for many of us, without Medicare we’d get NO care-is this what you now advocate, Shadowfax? Without private insurance, should the sickest of us just lay down & die to make it easier for you to practice on some rich b*tch with a hangnail & good private insurance? Maybe its time for you to QUIT practice, cos with the attitude I get from your post, I wouldn’t want to go to you!

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