More Medicare Audits Now Than Ever Before

6 Indest-2008-3George F. Indest III, J.D., M.P.A., LL.M., Board Certified by The Florida Bar in the Legal Specialty of Health Law

A Medicare audit, whether it is performed by a contractor of the Centers for Medicare & Medicaid Services (CMS), or by another organization, can be a daunting process. It is never “routine” and should never be taken lightly.

Because of the efforts to reduce expenditures on entitlement programs and the success that the government has had in recovering large sums of Medicare overpayments, we are seeing a tremendous increase in Medicare fraud initiatives, including but not limited to audits by Medicare Administrative Contractors (MACs), audits by Zone Program Integrity Contractors (ZPICs), Recovery Audit Contractors (RACs), the use of investigative subpoenas to obtain records, and related activities.

Medicare, Medicaid and TRICARE now routinely share audit results and information on repayments made by health providers. We had a client who conducted a self-audit and found an overpayment situation. The client made a voluntary disclosure and sent in a voluntary repayment of the amount it had overbilled Medicare. A few weeks later our client received an overpayment demand from the federal TRICARE program. The TRICARE demands were based on the same patients and the same claims for the co-pays and deductibles that had been paid back to Medicare.

Common Errors Found in Medicare Audits.

We often seem some common errors in Medicare audits. Most of the errors relate to improper or incomplete documentation. Such errors include:

1. Failure to obtain the physician’s signature on the order or plan.
2. Failure to have an order signed by a physician.
3. Tests, consults, prescriptions, therapy, or services ordered by a non-Medicare provider.                                                                                                                    4. Failure to document the start time and stop time of each (time-based) procedure.                                                                                                                                                  5. Failure to have complete, unique notes for each patient (use of “cloned” notes).                                                                                                                                                      6. Failure to demonstrate if a client is progressing toward improvement or goal. 7. Lack of medical necessity for procedures performed.                                                 8. Failure to have the care plan signed by the physician within 24 hours.

Locate and Review the Local Coverage Determinations (LCDs) for the Codes You Bill.

All Medicare providers should ensure that they are familiar with the local coverage determinations (LCDs) that are published by MACs for the CPT codes they routinely bill. These are available on the MAC website. Strict compliance with all such guidelines is required.

Make Sure to Obtain the Physician’s Signature Prior to Treatment.

Therapists and others providing services in response to a physician’s order or consult request must ensure that they obtain the proper physician’s signature before treating patients. Make this an ironclad rule in your practice or business. We have heard from some therapists that physicians often ignore their correspondence and documentation, or the physician sits on it for weeks at a time before signing it. If you refuse to touch the patient without the required doctor’s signature you cannot be faulted. The responsibility is on the physician who fails to sign a plan in a timely manner. If you are unable to do this, then just plan on providing the services for free. Guidance on documentation required for a therapist, as well as LCD, and therapy services required for Medicare can be found on the CMS website.

Checklist for Medicare Audits.

These are some of the actions we recommend you take and which we take in medicare blogrepresenting a physician or other health provider in responding to a Medicare audit.

1. All correspondence from Medicare, or the Medicare contractor, should be taken seriously. Avoid the temptation to consider the request from Medicare just another medical records request. Avoid the temptation to delegate this to an administrative employee.

2. Read the audit letter carefully and provide all the information requested. In addition to medical records, auditors often ask for invoices and purchase orders for the drugs and medical supplies dispensed to patients, for which Medicare reimbursed you.

3. Include a copy of the complete record and not just those from the dates of service requested in the audit letter. Include any diagnostic tests and other documents from the chart that support the services provided. Many practices document the medications and immunizations given to the patient in a separate part of the chart and not in the progress notes; all documents, the complete record, should be provided to the auditor. Remember that even other physicians’ records obtained as history, including reports, consultations and records from other physicians or hospitals, should also be included. Consent forms, medical history questionnaires, histories, physicals, other physicians’ orders, all may be a crucial part of the record. If the patient was referred to you by a hospital order, nursing home discharge order or another order, obtain these to provide to the auditor.

4. Make sure all the medical records are legible and legibly copied. If the record is not legible, have the illegible record transcribed and include the transcription along with the hand-written or illegible records. Make sure that any such transcriptions are clearly marked as a transcription with the current date it is actually transcribed. Label it accurately. Do not allow any room for there to be any confusion that the newly transcribed part was part of the original record.

5. If your practice involves taking or interpreting x-rays or other diagnostic studies, include these studies. They are part of the patient’s record. If the x-rays are digital, they can be submitted on a compact disc (CD).

For the complete checklist, click here.

Challenge Overpayment Demands from Medicare and Medicaid Audits.

Recently we have spoken with numerous physicians and other health care professionals who have been placed on prepayment review after failing to challenge Medicare audit results. The problem is that these providers, once placed on prepayment review, have their payments held up for many months and are often forced out of business. Sometimes it appears that this may actually be the goal of the auditing contractor or agency.


Have you or your practice ever been audited? What was the process like? Did you retain legal counsel to help with the process? Was having legal assistance worth it? Please leave any thoughtful comments below.

Don’t Wait Until It’s Too Late; Consult with a Health Law Attorney Experienced in Medicare and Medicaid Issues Now.

The attorneys of The Health Law Firm represent health care providers in Medicare audits, ZPIC audits and RAC audits throughout Florida and across the U.S. We also represent physicians, medical groups, nursing homes, home health agencies, pharmacies, hospitals, occupation therapists (OTs), physical therapists (PTs), speech therapists (STs), rehabilitation therapists (RTs) and other healthcare providers and institutions in Medicare and Medicaid investigations, audits, recovery actions and termination from the Medicare or Medicaid program.

To contact The Health Law Firm please call (407) 331-6620 or (850) 439-1001 and visit our website at

About the Author: George F. Indest III, J.D., M.P.A., LL.M., is Board Certified by The Florida Bar in Health Law. He is the President and Managing Partner of The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. The Health Law Firm, 1101 Douglas Ave., Altamonte Springs, FL 32714, Phone: (407) 331-6620.

The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.
Copyright © 1999-2015 The Health Law Firm. All rights reserved.

CMS Issues Conditions of Participation for Community Mental Health Centers

By Lance O. Leider, J.D., The Health Law Firm

On October 28, 2013, the Centers for Medicare and Medicaid Services (CMS) announced a Final Rule establishing conditions of participation (CoPs) for Medicare-certified community mental health centers (CMHCs). The Final Rule is CMS 3202-F. These conditions are the health and safety regulations Medicare providers must meet in order to participate in the Medicare program and receive reimbursements. The stated purpose of the CoPs is to improve client care, establish requirements for staff and provider operations, and encourage clients to participate in their own treatment. According to CMS, many CMHCs are currently not required to meet any health and safety standards.

To read the Final Rule from the CMS, click here.

A CMHC is a provider that meets applicable licensure and certification requirements in the state in which it is located and provides certain care and services.

Mental Health Centers Must Meet These New CoPs.

CMS finalized six new CoPs. All clients will have a treatment team, an active treatment plan, and coordination of services providing individualized client care. Clients must be provided with an initial evaluation, a comprehensive assessment, and a discharge or transfer plan that identifies each client’s needs and how those needs will be met on a timely basis. Also, CMHCs must use outcome and client satisfaction data to identify specific program needs and improve the quality of care provided. The regulations also promote continuity of care by emphasizing the need for communication with other service providers regarding client needs at the time of discharge or transfer.

In a press release, CMS stated that the new CoPs will help raise standards for the 100 CMHCs that participate in Medicare. The conditions will supposedly ensure a higher quality of care and safety for more than 13,000 Medicare beneficiaries being treated at mental health centers.

Click here to read the press release from the CMS.

Effective Date for New Requirements is October 29, 2014.

The regulations take effect on October 29, 2014. To verify CMHCs are meeting the new requirements, CMS will survey these centers at least once every five years. However, if CMS receives a complaint on a CMHC, surveys may occur more frequently. Considering the scrutiny that has been applied recently to the provision of mental health services, we expect surveys to be much more frequent.

Contact Health Law Attorneys Experienced in the Mental Health Counselors, Therapists and Facilities.

The attorneys of The Health Law Firm provide legal representation to mental health counselors, psychologists, social workers and family therapists in Department of Health (DOH) investigations, FBI investigations, audits and other types of investigations of health professionals and providers. Our attorneys also represent community mental health centers and other types of mental health facilities.

To contact The Health Law Firm, please call (407) 331-6620 or (850) 439-1001 and visit our website at


What do you think of the new CoPs for CMHCs? How do you think these conditions will improve patient care? Please leave any thoughtful comments below.


Centers for Medicare and Medicaid Services. “CMS Issues New Patient Safety Standards for Community Mental Health Centers.” CMS. (October 28, 2013). From:

Bourque, Dianne. “CMS Finalizes Conditions of Participation for Community Mental Health Centers.” American Health Lawyers Association. (November 5, 2013).
About the Author: Lance O. Leider is an attorney with The Health Law Firm, which has a national practice. Its main office is in the Orlando, Florida, area. The Health Law Firm, 1101 Douglas Avenue, Altamonte Springs, Florida 32714, Phone: (407) 331-6620.

“The Health Law Firm” is a registered fictitious business name of George F. Indest III, P.A. – The Health Law Firm, a Florida professional service corporation, since 1999.
Copyright © 1996-2012 The Health Law Firm. All rights reserved.

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