FWA Insights: Identifying modifier misuse in radiology services

Improper use of modifier codes in radiology can lead to excessive billing, often misrepresenting radiology services and diminishing trust between providers and health plans. As new requirements and measures emerge, special investigative units (SIUs) should remain vigilant with claims analyses and proper documentation to reduce overpayments.

This month’s edition of FWA Insights dives into outlier billing for modifier codes and excessive services in radiology, revealing the ramifications of medical coding discrepancies and providing practical steps to prevent fraud, waste, and abuse (FWA).

Investigation reveals modifier discrepancies

After receiving a tip from the health plan, Cotiviti’s SIU uncovered a radiology provider with outlier billing practices. The provider was flagged for unusual use of modifier codes and a high percentage of encounters for a single diagnosis.

Cotiviti investigators identified suspect billing patterns and estimated risk from the last two years of professional claims data. The investigative team began with a thorough analysis to examine billing patterns for CPT procedure codes 93922 (limited bilateral noninvasive physiologic studies of upper or lower extremity arteries), 95923 (testing of autonomic nervous system function; sudomotor), and 95921 (Testing of autonomic nervous system function; cardiovagal), revealing that codes 95923 and 93922 were often billed together with modifier 59.

Modifier 59 is used to indicate that a provider performed a distinct procedure or service for a beneficiary on the same day as another procedure or service. The provider’s documentation must also demonstrate that the service was distinct from other services performed on that day. Excessive use of modifier 59 can lead to overbilling and compliance issues, warranting further review.

Claims data showed that 28% of the provider’s paid claims included modifier 59, where the provider in question received over 30% more compensation than comparable industry peers. This preliminary review placed the potential overpayment at nearly $300,000.

Improper documentation yields high savings

Cotiviti requested medical records to validate the billed services where the provider failed to submit documentation, resulting in an overpayment. After the provider received an overpayment notice, records were submitted for review.

The investigation revealed several issues, including that the administration of the questionnaire and testing were performed on the same day, raising concerns about procedural integrity. The individual who performed the questionnaire was also not an employee of the provider that submitted the claims, and made the determination from the questionnaire responses whether or not a service was to be performed by the provider. Finally, there were several questionnaires submitted for appeal medical review that were potentially altered from the original review.

Based on this discovery, Cotiviti determined an overpayment of more than $500,000. The provider agreed to this amount and submitted payment in full to the health plan.

Key takeaways

For SIUs and medical coders, these findings highlight the importance of ongoing vigilance and attention to detail in radiology billing.

Health plans should consider these best practices to uncover improper billing and prevent overpayments:

• SIUs should apply a critical lens and pay close attention to providers who are outliers in modifier use. Proper documentation is essential to prove distinct services.
• Identifying suspect billing patterns through comprehensive claims analysis helps detect excessive or unnecessary services, reaffirming the crucial role that data mining plays in revealing improper billing. Most of the providers’ payments occurred within the last two quarters of the year, which may indicate a misrepresentation of services.
• Ensuring that medical records are complete, signed, and clearly explain the purpose and results of procedures is vital for compliance and accurate billing.

Combined with data-driven investigations and meticulous medical record review, targeted FWA data mining strategies can identify excessive use of outlier codes to help prevent overbilling.