Posted and filed under Compliance, Fraud, FWA, Healthcare.

Over the past few weeks, we have been engaging with clients on a variety of topics, the most recent being the discussion of “code rotation.” Some have asked what we mean when we discuss this term of art. We had often heard this term used by our retired OIG agents and thought it was an interesting phrase. When mentioning the phrase, it was used in the context of podiatry fraud schemes. For those of you in the podiatry auditing world, you are likely aware of the 61-day rule, which we describe below for some context.

Under Medicare rules, the program will generally only pay for certain podiatric procedures on the 61st day following the last service. To circumvent the edits that are in place, an unscrupulous provider may render the same services on a more frequent basis, and just misrepresent the service(s) rendered to receive reimbursement. By “code rotation,” an unscrupulous can seek to obtain reimbursement for a service that would otherwise not be paid. We were told of a specific case that was investigated by one of our retired OIG agents who saw this multiple time.

In one specific instance, the unscrupulous provider had a spreadsheet that he gave to his biller to use as a guide on the order in which the codes should be rotated. Each month, the patient would be treated by the provider, receive the same services, and the codes were rotated in an order set by the provider. Of course, as a collateral issue, the biller was complicit and knew that this was a fraud scheme. The provider was prosecuted, paid a hefty sum in restitution and civil damages, and served a prison sentence. He was also permanently excluded from the program and voluntarily surrendered his podiatry license. The biller was not prosecuted and served as a witness as part of the investigation.

We are sure that several other schemes can involve a rotation of codes, but the aforementioned example above was the one that both came to mind and was the easiest example. Part of the discussion was that in the absence of conducting a medical record review, the data analytics on their own might not have uncovered this fraud scheme. The rotation of the codes, in conjunction with the ever-annoying modifier 25, can bypass edits that are in place.

Medical record review is a very important part of the investigative continuum and should not be overlooked as part of any robust compliance program from a provider perspective. Knowing where your documentation falls, is extremely important in any compliance program. As we have espoused numerous times, the OIG, as part of its model compliance guidance, recommends self-audits; heed the OIG. Our retired OIG special agents can tell story upon story where had the provider just set a basic compliance plan in place, there would never have been the interaction that ensued.