Health Law Update by Lamb McErlane PC attorneys Vasilios J. Kalogredis, Esq. and Sonal Parekh, Esq.

On December 14, 2023, the Office of Inspector General (“OIG”) released a “Toolkit” offering Medicare Advantage (“MA”) organizations information and techniques to empower them to identify and evaluate high-risk diagnosis codes to ensure proper payments (i.e., decreased miscoding) and better care for enrollees. The Toolkit was released in response to (i) the OIG’s 2023 audit which revealed an average of 70% of diagnosis miscoding, where certain specific diagnosis codes were found to be miscoded 90% of the time, and (ii) requests to share the OIG’s methodologies for identifying high risk codes.

The Centers for Medicare & Medicaid Services (“CMS”) uses a risk adjustment system to pay MA organizations more for providing benefits to enrollees with diagnoses associated with more intensive use of health care resources relative to healthier enrollees that would be expected to use less resources. Accordingly, CMS needs MA organizations to collect and submit accurate diagnosis codes and implement compliance programs to monitor the accuracy of such codes on a continuous basis.

The Toolkit provides information on certain diagnosis codes that are at a higher risk of being miscoded, circumstances in which such miscoding could happen, as well as the methodologies and programming language the OIG uses to identify such high-risk codes.

With this resource readily available, it is advisable that MA organizations use the Toolkit as a starting point to (i) identify and correct inaccurate diagnosis codes, as well as (ii) identify other diagnosis codes that are at high risk for being miscoded and take steps to prevent and correct such errors.

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Vasilios J. (Bill) Kalogredis, Esq. has been advising physicians, dentists, and other healthcare professionals and their businesses as to contractual, regulatory and transactional matters for over 45 years. He is Chairman of Lamb McErlane PC’s Health Law Department. Bill can be reached by email at bkalogredis@lambmcerlane.com or by phone at 610-701-4402.

Sonal Parekh, Esq., is an associate at Lamb McErlane PC who focuses on healthcare transactional matters and a broad range of healthcare regulatory-related issues on behalf of healthcare systems, physicians, dentists, and other healthcare providers, and is a pharmacist by education and training. Sonal can be reached by email at sparekh@lambmcerlane.com or by phone at 610-701-4416.

*This alert is for educational purposes only and is not intended to be legal advice. Should you require legal advice on this topic or have any questions or concerns, please contact Vasilios J. (Bill) Kalogredis, Esq. or Sonal Parekh, Esq.