Recently, a fraud scheme was uncovered in Virginia involving a substance abuse clinic and the prescription of Suboxone with accompanying laboratory billing of urine drug screens. The substance abuse clinic prescribed its patients weekly Suboxone, a treatment for opioid addiction, for which a urine drug screen was required at each visit. While the clinic did not accept insurance, the drug screens were provided by a laboratory owned by the same owners as the clinic, which billed insurance up to $2000 for each drug screen test, and an additional $1125 for confirmation sent to an outside laboratory. This scheme contains several important signs payers can understand to prevent paying for fraudulent claims.

First, the type of drug screen the clinic billed differed depending upon the patient’s insurance. Further, the charge amount for the drug screens and confirmations was not consistent with usual, customary and reasonable (UCR) charges. Patients without insurance were charged for inexpensive “point of care” drug screening at $10-$25 a test. For patients with Medicare, Medicaid, or insurance, the plans were billed for expensive automated qualitative or quantitative drug testing at a charge of up to $2000 per test.

• CPT 80104 or HCPCS G0434 for Medicare is used for the “point of care” drug screen. Medicare has a median reimbursement per the Clinical Lab Fee Schedule of $26.82.

• For automated instrumentation qualitative drug testing, CPT 80101 or HCPCS G0431 for Medicare is used. The Medicare median reimbursement is $134.06.

• For automated instrumentation quantitative drug testing, CPT codes are per each drug tested. Examples of these CPT codes are: CPT 83925 for opiates at a Medicare reimbursement of $35.87 and CPT 83840 for Methadone at a Medicare reimbursement of $30.11.

Payers can guard against this type of fraudulent billing by monitoring the charges on these codes and identifying outliers for further investigation. Comparison of charges to usual, customary and reasonable rates gives a good point of comparison as to what is determinative of an outlier. In this case, a charge of $2000, which is 14 times the Medicare reimbursement, would indicate an outlier and the need for investigation.

Payers can also rely on Context 4 Healthcare's Fraud, Waste & Abuse solution. Our FWA Module within FirstPass^TM starts with real-time claims analysis during the adjudication cycle, while you’re still calculating your claim liability. FirstPass^TM contains thousands of rules consisting of millions of editing combinations, many of which are designed to identify potential FWA conditions. Additionally, the rules include evaluation of billed charges against our proprietary national Usual, Customary & Reasonable (UCR) fee schedule to find claims with charges out of the national norm for a service. These claims are identified and brought to your attention for follow up. As claims are processed, the FirstPass^TM FWA Module ensures that claims meet one or more of our potential FWA rules and alerts your processors to the situation so further analysis and investigations can begin.

For more ways to safeguard agains potentially fraudulent billing schemes: