HHS-OIG Flags Certain Extreme Outlier Telehealth Providers as Potentially Engaging in Fraudulent Billing During the Pandemic

HHS-OIG recently issued a report assessing Medicare program integrity risks arising from telehealth services furnished during the first year of the pandemic.  Although HHS-OIG identified only 1,714 providers whose billing for telehealth services “poses a high risk to Medicare”—  a relatively small percentage of the 742,000 providers who billed for telehealth services during the relevant time period—a closer review of the report (OEI-02-20-00720) reveals that HHS-OIG focused on only the most extreme outliers.  Providers who took advantage of CMS telehealth billing flexibilities during the pandemic should consider assessing their own organizations for potential outliers based on HHS-OIG’s metrics.

HHS-OIG reviewed billing data for the 742,000 providers who billed Medicare fee-for-service and/or Medicare Advantage plans for a telehealth service during the first year of the pandemic and assessed their billing patterns against seven metrics that could suggest inappropriate telehealth billing:

• billing both a telehealth service and a facility fee for most visits;
• billing telehealth services at the highest, most expensive level every time;
• billing telehealth services for a high number of days in a year;
• billing both Medicare fee-for-service and a Medicare Advantage plan for the same service for a high proportion of services;
• billing a high average number of hours of telehealth services per visit;
• billing telehealth services for a high number of beneficiaries; and
• billing for a telehealth service and ordering medical equipment for a high proportion of beneficiaries.

HHS-OIG identified 1,714 providers who had “concerning billing on at least one of seven measures…that may indicate fraud, waste, or abuse of telehealth services” and referred these providers to CMS for further investigation.  While this could be read to suggest that billing data for the vast majority of providers has a clean bill of health, the report indicates that HHS-OIG identified only the most significant outliers on each metric:

• 672 providers inappropriately billed for both a telehealth service and a facility fee for the majority of their visits;
• 365 providers always billed telehealth services at the highest, most expensive level every time;
• 328 providers billed for telehealth services for more than 300 days in a year;
• 138 providers billed both Medicare fee-for-service and a Medicare Advantage plan for the same service for more than 20% of their telehealth;
• 86 providers billed for an average of more than 2 hours of telehealth services per visit;
• 76 providers each billed for telehealth services for at least 2,000 beneficiaries in a year; and
• 67 providers billed for telehealth services and then ordered medical equipment and supplies for at least half of their beneficiaries.

Indeed, HHS-OIG acknowledged that it “set very high thresholds to identify providers whose billing poses a high risk to Medicare.”  HHS-OIG thus went on to explain that because its report “focuses on specific measures with very high thresholds, it does not capture all concerning billing related to telehealth services that may be occurring in Medicare.”

HHS-OIG identified two areas in which it has limited ability to oversee the provision of telehealth services and urged CMS to take corrective action.  First, HHS-OIG observed that a small subset of the 1,714 providers appeared affiliated with telehealth companies but that the government has no visibility into the name of the telehealth company—and thus no ability to investigate whether other providers associated with that telehealth company may be engaged in problematic billing.  Second, HHS-OIG explained that “incident to” billing can make it challenging for law enforcement to identify the particular provider who furnished the telehealth service at issue.  HHS-OIG recommended that CMS “require the use of a modifier to indicate ‘incident to’ telehealth services when clinical staff primarily delivered the service billed under the supervising practitioner’s identification number.”  According to HHS-OIG, CMS “did not explicitly indicate whether it concurred with” these recommendations.

Other telehealth-focused reports remain pending with HHS-OIG, and this work demonstrates law enforcement’s continued focus on targeted oversight of telehealth services billed to Medicare, especially during the pandemic.

This post is as of the posting date stated above. Sidley Austin LLP assumes no duty to update this post or post about any subsequent developments having a bearing on this post.