Archive for June, 2014

Deceptive Medical Billing Practices and Your Bodily Injury Investigation

Deceptive medical billing practices are a challenge irrespective of the complexity of claims being presented. From upcoding and unbundling to modifier abuse and improper global surgical edits, figuring out what is REALLY owed can be one of the greatest challenges for adjusters.  Perhaps nowhere is this more evident than when it comes to third party BI demands.

When a demand for an injury is received, there will be consideration for both special damages, providing compensation for economic loss, as well as general damages to compensate for pain and suffering. While both areas can be challenging, it is special damages that warrant particular scrutiny. Specials are often used as a foundation upon which large demands for generals can be made.   Because of the opportunistic nature that personal injury claims can pose, it has become more important than ever to conduct a thorough medical bill review.

As an industry, we continue to see escalating BI severities.   This is largely driven by inflated medical specials that have been trending at a pace in excess of the general consumer price index.     By developing a proven strategy to reign in medical inflation, carriers can gain a competitive advantage in the marketplace. 

Consider a demand received for a fairly typical accident in with the insured making a left turn in front of the claimant causing $2,500 in property damage and a soft-tissue low-back injury. There was no trip to the emergency room and the claimant treatment consisted of an initial visit to a medical doctor for $500, a referral to a chiropractor with $10,000 in treatment, a referral to specialist for $700 and $6,000 in diagnostic testing. At first glance, that $17,200 claim for medical specials seems pretty significant. A closer review of the medical bills, however, reveals that many of the CPT codes were inaccurate.

The initial treating physician billed $500 for CPT code 99205, which is a high-level office visit for a new patient requiring three key components:

 1)      A comprehensive history

 2)      A comprehensive examination

 3)      Medical decision making of high complexity

 A billing for this type of service typically occurs when there is a serious condition during which the doctor spends at least 60 minutes face to face with the patient. In this particular case, an injury of lower complexity is reported. This means what occurred is “upcoding,” a fraudulent practice, in which provider services are billed for higher CPT procedure codes than were actually performed, resulting in a higher payment by the insurance company.  

Given the volume of demands crossing an adjuster’s desk, there simply aren’t enough hours in the day to identify all CPT codes that have potentially been upcoded.   By leveraging software, such as Decision Point or Smart Advisor, adjusters can tap technology to more effectively identify potentially deceptive billing practices.

 When conducting the claims investigation, it is very important to take steps to not only validate treatment, but to also obtain details from the injured party, such as a physical description of the medical clinic and provider; route driven to the clinic; and a descriptive summary of procedures conducted and the duration of each. During my tenure investigating claims, it was not uncommon for claimants to cite face to face time as a matter of just a few minutes.

 Going back to our scenario, let’s say that after seeing the initial physician, the claimant is then referred to a chiropractor who bills 12 weeks of CPT codes 97110 (therapy) and 97140 (manipulation). This is important, as there are only four true chiropractic CPT codes as follows:

 98940 – Chiropractic manipulative treatment (CMT); spinal, one to two regions

 98941 – Spinal, three to four regions

 98942 – Spinal, five regions

 98943 – CMT, extraspinal, one or more regions

The billing by the chiropractor in this case is an example of “unbundling,” as 97110 and 97140 would be included in the chiropractic manipulation code. It is important to note that not all instances may be improper if the therapy or manipulation was done as a standalone procedure.

The secondary issue is the run up of $10,000 in chiropractic treatment in such a short period of time, often necessitating a records review for medical necessity and duration of treatment. To most effectively identify proper coding, treatment and duration issues, carriers may benefit from utilizing medical bill review services, coding experts and medical professionals who have the training and knowledge of the National Correct Coding Initiative (NCCI) to identify abuses.

 The demand also includes diagnostic testing which was billed as CPT code 72148 for a lumbar MRI with contrast and 72149 for a lumbar MRI without contrast.  72148 was billed at $2,400 and 72149 was billed at $2,600. These services should have been billed at CPT code 72158 for a lumbar MRI with and without contrast material. The reasonable cost for this bundled operation may have been $2,800. Again, paramount to determining what is owed is a review of medical bills to determine upcoding and unbundling.

 To properly evaluate a BI demand, it is imperative that the adjuster dig into all of the information provided by the attorney.   Medical bills should be thoroughly scrutinized with a process that leverages medical knowledge and coding expertise to focus on causation, relationship of diagnosis to treatment, frequency, duration and appropriateness of medical billings.

When digging into a BI demand, there are 10 key questions that the adjuster should be asking:

1)      Was there a mechanism for injury?

2)      Is there a causal relationship between the treatment and the injury?

3)      Were there pre-existing conditions or intervening causes?

4)      Is the treatment appropriate for the claim injuries?

5)      Is the treatment active or passive?

6)      Did the injury result in an objectively identified permanent impairment?

7)      What is the level of service being provided?

8)      What is the frequency, duration and expected time to reach MMI, or maximum medical improvement?

9)      Is coding accurate, including unbundling, upcoding, modifier abuse or global surgical edits?

10)   What is the actual amount of specials owed versus what was billed?

Of course, these tips are solely related to the medical specials.   Every BI investigation should also include consideration of liability and general damages.   Rather than focusing solely on “numbers” as personal injury attorney’s like to do, focus on the equitable resolution of each of the components of every claim.

1)      Liability- Who is at fault and to what degree?  What duties were owed, what duties were breached?

2)      Special Damages- Not only the medical bills as we have discussed, but also things like lost wages, mileage, replacement services or other economic loss.

3)      General Damages- When considering pain and suffering, recognize that not all claims, and not all venues, are equal.  The same claim in Bronx County, New York, will have a much different value than in Harris County, Texas.   While this same seem obvious, don’t underestimate the power of tools such as ClaimIQ to provide recommendations to adjusters based upon expert knowledge  that can improve both accuracy and consistency as opposed to the anecdotal advice from others, which can often lead to leakage.

While claims vary in complexity, this article is designed to provide a basic overview of what should be expected during the bodily injury demand review. By taking the additional steps to execute on basic blocking and tackling, carriers will create a competitive edge as they transform their claims organizations from ordinary to extraordinary.

Christopher Tidball is a claims consultant and the author of Re-Adjusted: 20 Essential Rules To Take Your Claims Organization From Ordinary To Extraordinary! He has more than 20 years of industry experience with multiple leading insurance carriers.   He will be speaking on Deceptive Medical Billing Practices as The Florida Defense Lawyers Association Liability Conference on June 6th, in Orlando, Florida.  To contact him, please e-mail .  To order his claims process improvement books, please visit



June 3, 2014 at 2:03 pm Leave a comment

Enter your email address to subscribe to this blog and receive notifications of new posts by email.

Join 145 other followers

Contact the Author

Chris Tidball is a claims and revenue management consultant and author of the "20 Essential Rules" series of self and organizational improvement books. You can ask him a question at

Kicked to the Curb

Kicked to the Curb


Finding Millions on Twitter

Error: Twitter did not respond. Please wait a few minutes and refresh this page.