Identifying and Addressing Upcoding Template

Compliance Program Implementation and Ethical Decision-Making

Healthcare managers and leaders must be familiar with laws, regulations, and the associated organizational policies and procedures that reinforce compliance. Fraud and abuse are just one example of a critical compliance area in healthcare administration (Stowell et al., 2020). While the issue of fraud and abuse is a complicated statutory theme, the government has availed enough resources to enhance comprehension of laws, regulations, and steps to take when suspected or actual incidents occur. The essay aims to write a workplace brief of evidence-based recommendations to identify and address upcoding, an incorrect health care billing practice. It will include a description of the major categories of health care fraud and abuse and the laws designed to address the

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Major Categories of Health Care Fraud and Abuse

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Category of Health Care Fraud and Abuse	Description of Category and Example from Authoritative Source*
Billing for services not rendered.	Audit and overpayment recoupment refer to billing for services not rendered, which comprise an overpayment that becomes debt providers owe to the federal government. It is an act of fraud punishable by law (Hoover et al., 2020)
Use of unlicensed staff	Unlicensed staff or personnel refers to a person other than a physical therapist or physical therapist assistant who performs patient-related tasks consistent with the unlicensed personnel’s education, training, and expertise under the direct on−premises supervision of the physical therapist (Borson, 2022). Therefore, practicing without a license is the Act of working without the licensure offered for that profession in a particular jurisdiction. It is against the law to practice or use unlicensed personnel to undertake activities that require licensure. Such actions are retrogressive to the law and hence have penalties for practicing without a valid license.
Altering medical records.	Changing medical data implies tampering with the evidence. Such proof will destroy the defendant’s integrity before a jury and leave the strong impression that they are trying to conceal the truth. Evidence showing that a record has been altered can force the settlement of an otherwise defensible case (Elsayed, 2020).
Drug diversion	Drug diversion is the criminal dissemination or abuse of prescription drugs or their use for purposes not intended by the prescriber. Prescription drug diversion may occur as prescription drugs are distributed from the manufacturer to wholesale distributors, pharmacies, or the patient (Ford & Grape, 2019)
Kickbacks and bribery.	A bribe is an Act or practice of giving or receiving something of value to corruptly influence the actions of another, most commonly to influence a contract award or the execution of a contract (Ford & Grape, 2019). On the other hand, a kickback is a bribe paid incrementally by the contractor as it is paid, usually an agreed percentage of the contract. In the health care setting, for example, when a physician or medical provider uses any payment or compensation to encourage a patient to come to their office or to promote another medical provider to refer patients to their office or facility.
Billing Practice Known as Upcoding	Upcoding is a category of fraud where healthcare providers submit incorrect billing codes to insurance institutions to receive inflated reimbursements. The most substantial impact of Upcoding is the increased cost to health payers—which they extrapolate on to consumers (Milcent, 2021). When government payers end up paying excessive money for health care, this is reflected in taxes and governments’ budgets.

Category of Health Care Fraud and Abuse

Description of Category and Example from Authoritative Source*

Billing for services not rendered.

Audit and overpayment recoupment refer to billing for services not rendered, which comprise an overpayment that becomes debt providers owe to the federal government. It is an act of fraud punishable by law (Hoover et al., 2020)

Use of unlicensed staff

Unlicensed staff or personnel refers to a person other than a physical therapist or physical therapist assistant who performs patient-related tasks consistent with the unlicensed personnel’s education, training, and expertise under the direct on−premises supervision of the physical therapist (Borson, 2022). Therefore, practicing without a license is the Act of working without the licensure offered for that profession in a particular jurisdiction. It is against the law to practice or use unlicensed personnel to undertake activities that require licensure. Such actions are retrogressive to the law and hence have penalties for practicing without a valid license.

Altering medical records.

Changing medical data implies tampering with the evidence. Such proof will destroy the defendant’s integrity before a jury and leave the strong impression that they are trying to conceal the truth. Evidence showing that a record has been altered can force the settlement of an otherwise defensible case (Elsayed, 2020).

Drug diversion

Drug diversion is the criminal dissemination or abuse of prescription drugs or their use for purposes not intended by the prescriber. Prescription drug diversion may occur as prescription drugs are distributed from the manufacturer to wholesale distributors, pharmacies, or the patient (Ford & Grape, 2019)

Kickbacks and bribery.

A bribe is an Act or practice of giving or receiving something of value to corruptly influence the actions of another, most commonly to influence a contract award or the execution of a contract (Ford & Grape, 2019). On the other hand, a kickback is a bribe paid incrementally by the contractor as it is paid, usually an agreed percentage of the contract. In the health care setting, for example, when a physician or medical provider uses any payment or compensation to encourage a patient to come to their office or to promote another medical provider to refer patients to their office or facility.

Billing Practice Known as Upcoding

Upcoding is a category of fraud where healthcare providers submit incorrect billing codes to insurance institutions to receive inflated reimbursements. The most substantial impact of Upcoding is the increased cost to health payers—which they extrapolate on to consumers (Milcent, 2021). When government payers end up paying excessive money for health care, this is reflected in taxes and governments’ budgets.

Five Health Care Fraud and Abuse Laws

Number	Health Care Fraud and Abuse Law	Description of Law	Rationale: How Does This Law Apply to Health Care?
1.	The False Claims Act (F.C.A.),	The False Claims Act is the federal law that imposes liability on persons and companies who defraud governmental programs. It is the federal government’s primary litigation tool in combating fraud against the government. The F.C.A. provides that any person who knowingly submitted false claims to the government is liable for a treble of the government’s damages plus a penalty proportional to inflation for each committed false claim (Milcent, 2021). The Act allows the government to pursue the violators and perpetrators of fraud on its own. In addition, the F.C.A. act enables the public to file suits on behalf of the government –qui tam suits- against those who have defrauded the government. Private individuals or those who successfully bring qui tam actions may receive a percentage of the government’s recovery.	The False Claims Act applies to health care by prohibiting workers from submitting fraudulent claims. In other words, healthcare practices must not bill the government for things they did not do (Milcent, 2021).
2.	The Civil Monetary Penalties Law (CMPL).	The Civil Money Penalties Law (CMPL) authorizes the Secretary of Health and Human Services to impose civil money penalties, an assessment, and program exclusion for various forms of fraud and abuse involving the Medicare and Medicaid programs.	The law imposes civil money penalties, an assessment, and program exclusion for various forms of fraud and abuse involving the Medicare and Medicaid programs.
3.	The Exclusion Authorities law (E.A.)	The law mandates the inspector general’s office to exclude individuals and institutions from federally funded healthcare programs. This is according to section 1128 of the Social Security Act; similarly, it excludes persons and entities from Medicare and State healthcare programs under section 1156 and maintains a list of all currently excluded individuals and institutions.	The law applies to health care by aiding in curbing and excluding rogue and corrupt individuals and entities from continuing to benefit from the Medicare programs.
4.	The Physician Self-Referral Law (Stark law),	The Physician Self-Referral Law prohibits physicians from making referrals of patients to receive delegated health services payable by Medicare or Medicaid from institutions with which the healthcare provider or a nuclear family has a financial connection unless an exception applies (Kanter& Pauly, 2019).	The Physician Self-Referral Law prohibits health care providers from referring patients to receive assigned health services that are supposed to be paid by Medicare or Medicaid from entities with which the health care provider or an immediate family member has a financial connection (Kanter& Pauly, 2019).
5.	The Anti-Kickback Statute (A.K.S.),	The federal Anti-Kickback Statute (A.K.S.) is a criminal statute that prohibits the exchange or offers of anything of value to compromise, induce or reward the referral of business reimbursable by federal health care programs(Kanter& Pauly, 2019). .	The Centers for Medicare and Medicaid Services (C.M.S.) claims that kickbacks have led to overutilization and increased costs of healthcare services, corruption of medical decision-making, steering patients away from good services or therapies, and unfair, non-competitive service delivery (Kanter& Pauly, 2019). Therefore, the law aids in cube increased cost of healthcare services and corruption of medical decision making, steering patients away from good health services.

Number

Health Care Fraud and Abuse Law

Description of Law

Rationale: How Does This Law Apply to Health Care?

1.

The False Claims Act (F.C.A.),

The False Claims Act is the federal law that imposes liability on persons and companies who defraud governmental programs. It is the federal government’s primary litigation tool in combating fraud against the government. The F.C.A. provides that any person who knowingly submitted false claims to the government is liable for a treble of the government’s damages plus a penalty proportional to inflation for each committed false claim (Milcent, 2021). The Act allows the government to pursue the violators and perpetrators of fraud on its own. In addition, the F.C.A. act enables the public to file suits on behalf of the government –qui tam suits- against those who have defrauded the government. Private individuals or those who successfully bring qui tam actions may receive a percentage of the government’s recovery.

The False Claims Act applies to health care by prohibiting workers from submitting fraudulent claims. In other words, healthcare practices must not bill the government for things they did not do (Milcent, 2021).

2.

The Civil Monetary Penalties Law (CMPL).

The Civil Money Penalties Law (CMPL) authorizes the Secretary of Health and Human Services to impose civil money penalties, an assessment, and program exclusion for various forms of fraud and abuse involving the Medicare and Medicaid programs.

The law imposes civil money penalties, an assessment, and program exclusion for various forms of fraud and abuse involving the Medicare and Medicaid programs.

3.

The Exclusion Authorities law (E.A.)

The law mandates the inspector general’s office to exclude individuals and institutions from federally funded healthcare programs. This is according to section 1128 of the Social Security Act; similarly, it excludes persons and entities from Medicare and State healthcare programs under section 1156 and maintains a list of all currently excluded individuals and institutions.

The law applies to health care by aiding in curbing and excluding rogue and corrupt individuals and entities from continuing to benefit from the Medicare programs.

4.

The Physician Self-Referral Law (Stark law),

The Physician Self-Referral Law prohibits physicians from making referrals of patients to receive delegated health services payable by Medicare or Medicaid from institutions with which the healthcare provider or a nuclear family has a financial connection unless an exception applies (Kanter& Pauly, 2019).

The Physician Self-Referral Law prohibits health care providers from referring patients to receive assigned health services that are supposed to be paid by Medicare or Medicaid from entities with which the health care provider or an immediate family member has a financial connection (Kanter& Pauly, 2019).

5.

The Anti-Kickback Statute (A.K.S.),

The federal Anti-Kickback Statute (A.K.S.) is a criminal statute that prohibits the exchange or offers of anything of value to compromise, induce or reward the referral of business reimbursable by federal health care programs(Kanter& Pauly, 2019).

The Centers for Medicare and Medicaid Services (C.M.S.) claims that kickbacks have led to overutilization and increased costs of healthcare services, corruption of medical decision-making, steering patients away from good services or therapies, and unfair, non-competitive service delivery (Kanter& Pauly, 2019). Therefore, the law aids in cube increased cost of healthcare services and corruption of medical decision making, steering patients away from good health services.

Upcoding and the Law

Law Pertaining to Upcoding	Explanation of Upcoding	Case Example of Upcoding
18 U.S.C. § 1347- The criminal healthcare fraud statute. This statute makes healthcare fraud, such as upcoding, a criminal offense. This statute imposes hefty punishment for the crime.	Upcoding is when a provider assigns an incorrect billing code to a medical procedure or treatment to increase reimbursement. Medicare abuse exposes providers to criminal and civil liability. Furthermore, the program integrity comprises a range of activities targeting various causes of improper payments.	An example of upcoding is when a physician provides a follow-up office visit or follow-up inpatient consultation but bills a higher level E&M code as if they had provided a comprehensive new patient office visit or an initial inpatient consultation.

Law Pertaining to Upcoding

Explanation of Upcoding

Case Example of Upcoding

18 U.S.C. § 1347- The criminal healthcare fraud statute. This statute makes healthcare fraud, such as upcoding, a criminal offense. This statute imposes hefty punishment for the crime.

Upcoding is when a provider assigns an incorrect billing code to a medical procedure or treatment to increase reimbursement. Medicare abuse exposes providers to criminal and civil liability. Furthermore, the program integrity comprises a range of activities targeting various causes of improper payments.

An example of upcoding is when a physician provides a follow-up office visit or follow-up inpatient consultation but bills a higher level E&M code as if they had provided a comprehensive new patient office visit or an initial inpatient consultation.

Evidence-Based Recommendations to Address Upcoding

Recommendation*	Source
It is recommended that the best option and the only way to identify an Upcoding impasse is to collect and compare data on the E/M coding and billing. It is best to begin by aggregating all of the data for a given period, for instance, starting with data for the past few months from the system into a report, provider by provider.	(Bastani et al., 2019)
In detecting Upcoding or down coding, an individual must be conversant with the billing or fee schedule and be able to compare those to the amount mentioned on the E/M or the E.O.B. forms. In addition, the person must be familiar with the NCCI edits and mutually exclusive elements.	(Cook & Averett, 2020).
It is an issue of individual integrity; thus, individuals must make it a personal duty to ensure patient information is correct and aligned adequately with data and avoid Upcoding.	(Mackey et al ., 2020)
It is also recommended to utilize the current Medical coding manual to avoid billing duplication. In addition, there is a need to verify insurance benefits and coverage in Advance.	(Teng et al., 2020)
If an individual is not knowledgeable about how health billing is done, it is recommended that the entity or individual hire a professional medical biller. We also recommend Improvement medical billing and coding systems with Coronis Health.	(Sonawala, 2019).

References

Bastani, H., Goh, J., & Bayati, M. (2019). Evidence of Upcoding in pay-for-performance programs. Management Science, 65(3), 1042-1060. https://doi.org/10.1287/mnsc.2017.2996

Cook, A., & Averett, S. (2020). Do hospitals respond to changing incentive structures? Evidence from Medicare’s 2007 DRG restructuring. Journal of Health Economics, 73, 102319. https://doi.org/10.1016/j.jhealeco.2020.102319

Elsayed, D. E. M. (2020). Fraud and misconduct in publishing medical research. Sudan Journal of Medical Sciences (SJMS). https://doi.org/10.18502/sjms.v15i2.6693

Ford, C., & Grape, R. (2019). The Role of Data in Mitigating Drug Diversion. Drug Topics, 163(5), 9-10. http://www.drugtopics.com/

Hoover, N. D., Turner, R. B., Sampson, J., Pye, T., & Hotan, T. (2020). Financial sustainability of an Oregon rural health, primary care, and pharmacist-run comprehensive medication management program through direct medical billing. Journal of Managed Care & Specialty Pharmacy, 26(1), 30-34. https://doi.org/10.18553/jmcp.2020.26.1.30

Kanter, G. P., & Pauly, M. V. (2019). Coordination of care or conflict of interest? Exempting ACOs from the Stark Law. N Engl J Med, 380(5), 410-411.

Mackey, T. K., Miyachi, K., Fung, D., Qian, S., & Short, J. (2020). Combating health care fraud and abuse: conceptualization and prototyping study of a blockchain antifraud framework. Journal of Medical Internet Research, 22(9), e18623. https://preprints.jmir.org/preprint/18623?__hstc=102212634.8112e46f7e0d4a858505ac42912ee601.1654965091476.1654965091476.1654965091476.1&__hssc=102212634.1.1654965091477&__hsfp=1295907224

Milcent, C. (2021). From downcoding to upcoding: DRG based payment in hospitals. International Journal of Health Economics and Management, 21(1), 1-26. https://doi.org/10.1007/s10754-020-09287-x

Sonawala, K. M. (2019). KMSonawala Mobile Heart Care Clinic: An Initiative to Provide Mobile Vehicle Heart Care to Patients in the Los Angeles County and Orange County Cities and Census-Designated Places (CDPs), with Emphasis on Treating Patients Who Identify as Asian Indians. California State University, Long Beach.

Stowell, N. F., Pacini, C., Wadlinger, N., Crain, J. M., & Schmidt, M. (2020). Investigating Healthcare Fraud: Its Scope, Applicable Laws, and Regulations. William & Mary Business Law Review, 11(2), 479. https://scholarship.law.wm.edu/wmblr/vol11/iss2/5

Teng, F., Ma, Z., Chen, J., Xiao, M., & Huang, L. (2020). Automatic medical code assignment via deep learning approach for intelligent healthcare. IEEE Journal of Biomedical and Health Informatics, 24(9), 2506-2515. https://doi.org/10.1109/JBHI.2020.2996937

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Identifying and Addressing Upcoding Template
Major Categories of Health Care Fraud and Abuse
Category of Health Care Fraud and Abuse Description of Category and Example from Authoritative Source*
[Enter category of health care fraud and abuse here] [Enter description of category and example from authoritative source here]
[Enter category of health care fraud and abuse here] [Enter description of category and example from authoritative source here]
[Enter category of health care fraud and abuse here] [Enter description of category and example from authoritative source here]
[Enter category of health care fraud and abuse here] [Enter description of category and example from authoritative source here]
[Enter category of health care fraud and abuse here] [Enter description of category and example from authoritative source here]
*Be sure to include the billing practice known as upcoding.

Five Health Care Fraud and Abuse Laws
Number Health Care Fraud and Abuse Law Description of Law Rationale: How Does This Law Apply to Health Care?
1. [Enter health care fraud and abuse law here] [Enter description of law here] [Enter explanation of how law applies to health care here]
2. [Enter health care fraud and abuse law here] [Enter health care fraud and abuse law here] [Enter explanation of how law applies to health care here]
3. [Enter health care fraud and abuse law here] [Enter health care fraud and abuse law here] [Enter explanation of how law applies to health care here]
4. [Enter health care fraud and abuse law here] [Enter health care fraud and abuse law here] [Enter explanation of how law applies to health care here]
5. [Enter health care fraud and abuse law here] [Enter health care fraud and abuse law here] [Enter explanation of how law applies to health care here]
Upcoding and the Law
Law Pertaining to Upcoding Explanation of Upcoding Case Example of Upcoding
[Enter law pertaining to upcoding here] [Enter explanation of upcoding here] [Enter case example of upcoding here]

Evidence-Based Recommendations to Address Upcoding
Recommendation* Source
[Enter evidence-based recommendation to address upcoding here] [Enter source for evidence-based recommendation here]
[Enter evidence-based recommendation to address upcoding here] [Enter source for evidence-based recommendation here]
[Enter evidence-based recommendation to address upcoding here] [Enter source for evidence-based recommendation here]
[Enter evidence-based recommendation to address upcoding here] [Enter source for evidence-based recommendation here]
[Enter evidence-based recommendation to address upcoding here] [Enter source for evidence-based recommendation here]
*Visit these websites:
• https://www.cms.gov/Outreach-and-Education/Medicare-Learning-Network-MLN/MLNProducts/Downloads/Avoiding_Medicare_FandA_Physicians_FactSheet_905645.pdf
• https://oig.hhs.gov/compliance/101/

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Identifying and Addressing Upcoding Template

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Identifying and Addressing Upcoding Template