Behavioral Healthcare Organization Settles Allegations of Improper Billing for Services Furnished by Unlicensed Providers
The United States Attorney’s Office for the District of Connecticut recently announced a civil settlement agreement with a behavioral healthcare organization that provides in-home family therapy and counseling in the greater Hartford area (the “Company”). The government’s allegations arose out of improper billing for services provided by unlicensed providers.
Connecticut’s Department of Social Services (“DSS”) contracted with the Company to provide behavioral health services to Medicaid beneficiaries, including recipients of the Connecticut Medical Assistance Program. The government alleged that the Company routinely submitted claims to Medicaid for services as if a licensed behavioral health clinician performed the services when, in fact, the services were performed by an unlicensed provider. DSS prohibits licensed behavioral health clinicians in independent practice to submit claims for services provided by unlicensed individuals, even if the individuals who furnished the services were supervised and working towards their licensure.
The Company also billed for “incident to” services, which violated the terms of the DSS Provider Manual for Licensed Behavioral Health Clinicians in Independent Practice. Generally, when billing “incident to,” services are furnished by a midlevel provider and the claim displays the name of a supervising physician. If the payor allows “incident to” billing and the services and documentation meet the payor’s supervision, site-of-service, and other requirements, the claim is reimbursed at 100% of the physician fee schedule, versus the midlevel provider’s reimbursement rate, which is typically 85% of the physician fee schedule. In the instant matter, DSS did not permit “incident to” billing, which was the basis of the additional allegation of billing impropriety. The Company was attempting to collect the highest possible reimbursement under an “incident to” billing regime not allowed by DSS, and was doing so for claims that were not even deemed valid or reimbursable because the services were furnished by unlicensed providers. As a result of the investigation, which was conducted by the Office of Inspector General for the U.S. Department of Health and Human Services, the Company will pay $273,000 to the federal and state governments for the improper billing that occurred over a nearly 6-year period.
This case presents an important reminder that: (i) providers should verify whether the applicable payor permits a non-licensee or licensee-in-training to participate in the furnishing of services for which a claim will be submitted; and (ii) “incident to” billing is not always permitted, and when it is allowed, it is subject to strict requirements.
How Frier Levitt Can Help
Healthcare providers submitting claims to Medicare, Medicaid, or commercial insurers must adhere to the rules governing the provision of covered services, including coding and billing requirements for the proper submission of claims. Failure to adhere to the applicable requirements can result in a variety of adverse consequences, including claim denials, audits, recoupments, and potentially, False Claims Act liability.
Frier Levitt has a team of experienced attorneys dedicated to defending provider clients against healthcare fraud investigations and prosecutions, and the collateral consequences therefrom. Our attorneys also regularly assist in the defense of payor claims reviews, and can assist providers with proactive “self-audits” to enhance compliance and the probability of successfully defending future audits and investigations. For more information, contact Frier Levitt to speak with an attorney.