Are you seeing me to help me, or to milk the system?
DURING A 2.12.37 HOUR INDIAN RIVER COUNTY (IRC) COMMISSIONER’S CONSENT AGENDA ITEM ON 12.20.2016, WHICH COMMISSIONER FLETCHER DESCRIBED AS THE LONGEST IN IRC HISTORY, THE COMMISSIONERS DEBATED THE $ 1,122,000 IN ACUPUNCTURE BILLINGS THEY PAID TO ABSOLUTE INTEGRATED MEDICINE (AIM) IN 2016.
The focus of the discussion was how to amend the counties’ health insurance plan to limit this exposure, which County Administrator Jason Brown described as “a cost that is unsustainable.”
This is a complicated issue. We have watched the 2.12.37 hour video of the meeting two times to get our arms around the nature of the issue to explain it to you as simply as possible.
IRC “self-insures” health care for its employees, including those working for the Sheriffs’s Department. The essence of the concept is that IRC is liable for health care costs, chooses to “carry the risk” itself, and not take out insurance through an insurance company.
Since IRC does not have the resources to manage the plan and pay claims itself, it hired Florida Blue to take on that responsibility.
Unlike the School District of Indian River County, IRC provides an acupuncture benefit to its roughly 1,570 employees, retirees and constitutional officers.
In 2012 the paid claims for acupuncture services was under $ 10,000. At that time, there were roughly 1,500 enrolled in the overall plan. Now there are 1,570.
But in 2016, claims paid for acupuncture services to one provider, Absolute Integrated Medicine were $ 1,122,000. In the third quarter of 2016, the claims amounted to $ 253,442.
IRC’s Human Resources Director, Suzanne Boyle, who uncovered the egregious billing, referred to it as “run away claims” and “scary.” Mr. Brown said he had to “express the urgency to stop the bleeding.”
He said of IRC’s top 25 healthcare providers, Absolute Integrated Medicine has been charging over 10 to 20 times what they have paid the other providers (e.g. pediatricians, ObGyn and Oncologists.)
Commissioner Fletcher said: “the numbers are glaring.” Commissioner Susan Adams said: “this has been brought about by one bad actor.”
Others said: “we have to stop the hemorrhaging” and “one office has been causing the problems.”
Even Florida Blue, the claims manager, said that IRC, through its self insurance is “operating with an open check book.”
Here’s what’s been happening:
IRC provides the acupuncture benefit to its employees. In 2016, 221 employees utilized the benefit. There were 8,242 visits at an average cost to the IRC of $ 123.27 per visit.
In 2013, 75 employees utilized the benefit; in 2014 it was 147; in 2015 is was 217; in 2016 it was 221. IRC HR Director Ms. Boyle indicated that there is an upwards trend and the problem will only get worse next year.
IRC pays the 60% coinsurance for the visit and the employee is expected to pay the 40% co-pay.
But AIC has been waiving the co-pay and has been billing it to IRC, together with the coinsurance, as the overall cost of the visit. Thus, all 8,242 visits in 2016 were free.
Furthermore, AIC has been giving its IRC patients free herbs and substances that they would have to buy if they went to another acupuncturist.
So here’s the gig. AIC has been incentivizing IRC patients to utilize their services because they are free and they receive free herbs and substances. That means you could go every day.
Ms. Angela King, owner of Indian River Acupuncture, truly enlightened the Commissioners with a report on ethical billing practices, drilling down into the current Procedural Terminology (CPT) codes, which describe the treatments that are administered.
There are only a few codes relevant to an acupuncturist. She elaborated on the codes and what the average cost would be for each code:
97140: Manual Therapy / $ 16.86
97530: Therapeutic Exercises / $ 15.86
97810: Acupuncture Without Electrical Stimulant / $ 20.90
97811: Acupuncture One or More Needles / $ 46.81
97814: Additional 15 Minutes Personal Contact with Patient: $ 10.70
Ms. King emphasized that no one would have all treatments together; that there could be improper billings under codes, that how can an acupuncturist and staff manage 8,242 visits, and that in her opinion the average cost for an acupuncture treatment would be $30 – $50; $ 60 at the most, not $123.27.
Excess billing of codes, four or more for any session, should lead to the acupuncturist’s records being questioned and investigated as this is indicative of inflated billing.
Further, she said that to get to $ 1,122,000 in billings for 221 people in a year is “beyond expectation and ethical considerations.” Commissioner Bob Solari questioned if it was mathematically possible.
Ms. Boyle seemed exasperated that Florida Blue has not helping her mitigate the issues related to the inflated billing. She said she has been spending weeks going back and forth, basically getting no where, which caused the Commissioner’s to ask isn’t there another health care manager to help us develop a solution?
Ms. Boyle also indicated, that to the extent Florida Blue was trying to oversee claims, AIC has not been responsive in providing backup documentation on their coded billings.
So in the end, to limit the County’s exposure to the “run away claims” and the “open checkbook, ” the Commissioners unanimously voted to a limit of 26 visits for acupuncture per year (consistent with chiropractic benefits) up to a capped maximum benefit of $ 1,500. This will be effective 2.1.2017.
But is that the end of it?
If they are not already doing so, IRC Commissioners and staff should be pursuing a forensic audit of AIC’s billing practices.
Jill Jaynes, Owner, Absolute Integrated Medicine
Jill Jaynes, owner of Absolute Integrated Medicine was not in attendance at the County Commissioner’s meeting. Perhaps on the advise of legal counsel?
Federal law never allows waivers of patient responsibility to be offered as part of any advertisement or solicitation. Basically a provider cannot use the enticement of waving the patient’s co-payment to get a patient in the door. A provider may think that they can advertise a special where they will waive the patient’s co-pay for a new patient consultation to try to get more patient’s into their practice but this is illegal.
Most managed care contracts forbid waiving patient responsibility. They consider such waivers to constitute insurance fraud, misrepresentation and unfair competition. If an insurance carrier discovers a provider is waiving co-payments the insurance carrier has the right to stop payments on a claim and/or recover amounts already paid on claims.
According to the Anti-Kickback Statute [42 U.S.C. § 1320a-7b(b) it is a criminal law that prohibits the knowing and willful payment of “remuneration” to induce or reward patient referrals or the generation of business involving any item or service payable by the Federal health care programs (e.g., drugs, supplies, or health care services for Medicare or Medicaid patients).
Regardless of whether you’re an in-network or out-of-network provider, routinely waiving deductibles and copays could bring some serious—and seriously expensive—litigation. And the likelihood of jail time.
We hope IRC Commissioners are pursuing a forensic audit.