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How Proper Medical Billing and Coding Practices Can Keep Physicians Out of Legal Trouble

How Proper Medical Billing and Coding Practices Can Keep Physicians Out of Legal Trouble

For obvious reasons, medical billing is essential in the practice of medicine. Just like everyone else, doctors want to be paid for their services. While timely and proper billing is the key to financial success and stability of a medical practice, improper billing practices may get a physician in trouble beyond any imagination. Medical billing and keeping medical records are two absolutely interrelated areas and proper documentation maintenance is crucial to avoiding many billing issues.

Physicians are not trained to be medical billers; most practices employ billing professionals or medical management companies to handle all billing issues. However, it is ultimately the doctors responsibility to make sure that the claims are valid and all the regulatory requirements are met when the claims are submitted to payers. There are many potential payers but Medicare and Medicaid are clearly the largest ones, followed by insurance companies and HMOs. Each payer has a complicated system of payment policies and procedures, many of which are constantly changing. Failure to comply with the established billing procedures is likely to result in an audit or even a criminal investigation. Many federal Medicare fraud criminal prosecutions were triggered by medical billing audits and investigations.

According to the Office of Inspector Generals Compliance Guidance, the following billing activities are most likely to be targeted for audits or investigations: billing for items or services not provided, submitting claims for services or equipment which is not medically necessary, double billing, billing for services not covered by the program and representing that a covered service was provided, failing to properly use coding modifiers, clustering, and upcoding the level of service provided.

The proper keeping of documentation in the medical records is the proven way to avoid many potential problems and minimize damages in case potential problems become real. Properly maintained medical record documentation may be used by defense in an investigation or an audit to determine what services were provided and who provided them. Most importantly, it could be established that there existed a reasonable medical necessity for the services. Many billing issues may be resolved early in the investigative process when a physician is able to demonstrate that his or her billing was accurate and appropriate.

A good medical record will contain information about reason patient sought the practitioners help, relevant medical history and diagnostic test results, physical exam findings, medical assessment, clinical impression and diagnosis, the treatment plan, and date and signature of the provider.