Third party billing group rebuts OIG fraud report

The Healthcare Billing and Management Association (HBMA) told a key congressional committee April 14 that the Department of Health and Human Services’ Office of Inspector General’s (OIG) recent report on third party billing companies is "significantly flawed" and "factually inaccurate" in virtually every section.

"At best, it reveals a superficial and incomplete knowledge of a very complex industry," the Laguna Beach, CA-based association wrote the House Commerce Subcommittee on Oversight April 14. HBMA’s missive followed its appearance before the subcommittee April 6 where the OIG and the General Accounting Office (GAO) used the example of one purported third party biller to illustrate problems plaguing the industry (see Compliance Hotline, April 10, 2000, p. 3).

In fact, Robert Burleigh, chair of HBMA’s Ethics and Compliance Committee, contends that the single company examined by the committee, Behavioral Medical Systems, Inc. of Sugarland, TX, is not really a billing company at all. He says the company misrepresented itself as a provider, not only to the Medicare program, but apparently to the real billing company that it used to submit the false claims.

Burleigh also argues that GAO’s report incorrectly characterized its example case as billing company fraud when it was not. HBMA speculates that GAO wanted to avoid reporting old news’ and slanted the report about BMS in order to describe provider fraud as billing company fraud. "The only other conclusion is that they do not know the difference between a provider and a billing company," Burleigh argues.

According to Burleigh, the GAO and OIG make constant reference to "third party billing companies" in their reports without attempting to define their use of the term. "What about the medical practice that, for tax reasons, has incorporated its own billing office under another identity?" he asserts. "What about the claims clearinghouse to whom claims are sent by medical practices or billing companies? What about hospital-owned practices, billed by the hospital under the identity of its management service organization?"

If Congress accepts the OIG’s report as gospel, it could have a profound impact on the entire third party billing industry, Burleigh concludes.

HBMA also criticized the OIG’s recommendation that billing companies should be identifiable by carriers. "That could be a relatively benign additional requirement, but even if billing company registration had already existed, it would have done nothing to prevent or detect the misconduct reportedly perpetrated by BMS," the association argued.