Regulatory agencies on the lookout for overpayments—and how practices can avoid fate of Zwanger-Pesiri

A Long-Island radiology practice agreed to pay more than $10 million late last year to settle two counts of healthcare fraud related to performing and billing pelvic ultrasounds. This settlement raised regulatory eyebrows, according to a presentation at RBMA’s PaRADigm 2017 meeting, and imaging practices should take steps to ensure they aren’t making the same mistakes.

From 2003 to 2015, Zwanger-Pesiri Radiology group automatically performed a transabdominal ultrasound whenever a transvaginal ultrasound was ordered by a treating physician, and vice-versa. However, they failed to follow correct procedure for authorizing the second ultrasound, resulting in payments that were fraudulent in the eyes of the law.

“What [the State of New York] is criticizing in the settlement is something that happens all the time in the industry,” said W. Kenneth Davis, lawyer at Chicago-based firm Katten Muchin Rosenman. “The lack of documentation was especially apparent when [both procedures] were automatically ordered, when they looked at the records there was a stark paucity of support do both.”

Diagnostic tests must be ordered by the treating physician, but the supervising physician can alter it if he believes it’s clinically inappropriate or the patient’s condition is incompatible with the exam. But the supervising physician must go get a new order from the treating physician. There are exceptions, such as conditional follow-up exams, but the pathway to test alteration almost always lies through the treating physician. However, if the interpreting physician is unable to reach the treating physician, altering the test can still be accomplished—if even more conditions are met.

This is where pelvic ultrasounds come in, according to Davis. When a generic pelvic ultrasound is ordered, it can be accomplished through a transabdominal or transvaginal ultrasound and it’s often up to the interpreting physician to make that decision. Sometimes, that decision is both—but the medical necessity needs to be documented in the patient record.  

“If you boil all this down, if a physician orders a pelvic ultrasound, under the test design exception your interpreting physician can determine whether to perform a transabdominal ultrasound or a transvaginal ultrasound,” said Davis. “Heres the kicker; it has to be done on a patient by patient basis and there has to be medical necessity support within the record. You could have notation from the interpreting physician saying ‘this is why we’re having this done,’.”

“Zwanger-Pesiri had programmed their billing system to link the two, which was wrong in a number of ways,” he added. “

To avoid the hefty settlement paid by Zwanger-Pesiri, Davis recommends an audit of occasions when both procedures were preformed—even if your practice is in violation, you can avoid a legal quagmire through the “60-day rule.”

Under the Affordable Care Act, CMS passed a rule giving providers 60 days to report and return overpayments from the date they are quantified. According to Davis, CMS will generally give you six months to quantify the amounts after noticing irregularities.

Scenarios that qualify as overpayments include:

·      If the performing physician has ordered a transvaginal ultrasound and you bill for a transabdominal ultrasound.

·      Bills for services in violation of Stark law.

·      Bills for services that were referred by a physician where you have a relationship that arguably violates anti-kickback statues.

“If you’re doing both transabdominal and transvaginal ultrasound together, the necessity rates could vary dramatically from center to center,” said Davis. “You may find that 80 percent  were ok. You may find that 20 percent were okay—the critical thing is you can’t simply assume the medical necessity is there without going into the records.”