Compliance Plan for Third-Party Medical Billing Companies

By Caral Edelberg, President, Medical Management Resources

The Office of Inspector General released the long-awaited Compliance Plan for Third-Party Medical Billing Companies November 30. The extensive plan identifies the top areas of attention for billing companies and provides suggestions for both small and large billing companies on compliance issues.

Outlined in the plan are seven critical elements that should be included in each billing compliance plan. They include:

• Development and distribution of written standards of conduct, policies, and procedures that promote commitment to compliance and address specific areas of potential fraud (i.e., claims submission process, code gaming, and financial relationships with the providers.)

• Designation of a chief compliance officer and/or other appropriate responsible persons or committees responsible for operating and monitoring the corporate compliance program and reporting directly to the CEO and governing body.

• Development and implementation of regular, effective education and training programs for any affected employees.

• Creation and maintenance of a reporting process, or hotline, to assure that complaints are handled appropriately.

• Development of a system to respond to both internal and external allegations of improper and/or illegal activities with assurances of disciplinary action.

• Use of audits and other evaluation techniques to monitor compliance and identify problem areas.

• Investigation and correction of systemic problems with assurances of non-employment of sanctioned individuals.

Although the plan contains many valuable suggestions for the development and maintenance of compliance policies and procedures, it also includes numerous predictably controversial recommendations, which are sure to create many issues between billing companies and their provider clients. The potentially contentious issues include:

• Restricting coders and billing consultants from sharing in any financial incentives which may encourage upcoding claims;

• Ensuring that only properly documented services may be billed;

• Assuring timely and appropriate resolution of overpayments (credit balances);

• Suggesting a program for sanctions for billing supervisors who fail to adequately instruct subordinates or fail to detect non-compliance;

• Self-reporting to the government of corporate misconduct that may violate criminal, civil or administrative law; and

• Requirements for reporting where credible evidence of client misconduct or fraudulent/abusive conduct exists, as well as assurances of billing company’s termination of billing activities for the client.

Editor’s note: A detailed discussion of the pros and cons of the OIG Billing Compliance plan with helpful suggestions for developing your own unique plan will be featured in an upcoming issue of ED Management.