Coding Errors and Jail Time

Here is some interesting news:

Agnesian HealthCare is suing health IT vendor Cerner for $16 million to recoup losses the provider says it incurred as a result of coding errors in Cerner’s billing software that resulted in large numbers of undetected claims write-offs made to payers.

There’s more:

“Immediately after going live, Agnesian experienced pervasive errors inpatient billing statements,” states the legal complaint. “Agnesian began to expend extraordinary amounts of time and financial resources to manually process patient billing statements. Continuing problems with the integrated solution resulted in a huge backlog of patient claims for reimbursement, the effects of which Agnesian is still experiencing.”

Ok, some more:

Agnesian alleges in its complaint that, in the summer of 2016, Cerner “represented that all major issues were resolved and that the integrated solution was stable.” However, the provider subsequently learned that the system was “automatically writing off reimbursable charges for services without any notice to Agnesian” resulting in “large numbers of undetected write-offs of claims made to insurance companies and other payers.”

Still, the worst is not over, contends Agnesian as the situation “continues to cause grave damage” to its reputation with thousands of patients “subject to the stress of not being able to reconcile their billing statements to the healthcare services provided” as well as damages of at least $200,000 per month.

Agnesian’s suit also claims that the Cerner system requires a complete rebuild of the professional billing program logic, but the project “has now ground to a halt” because qualified Cerner personnel are no longer employed by the vendor. Consequently the provider says it “may not be able to upgrade to the federally mandated 2018 Certified Electronic Health Record Technology platform” which “materially impacts Medicare and Medicaid provider participation reimbursement to Agnesian.”

What I find interesting here is that these mistakes went against the hospital and there were monetary losses.  Now if the mistakes were “overbilling” then the doctor would be slapped with fraud and could be penalized or jailed.  I would like someone to correct me on that if I am wrong (technically, underbilling is fraud, too, but the gov’t doesn’t usually care about that).

You only hear about this case because the hospital system has the money to fight it.  When these billing systems change the coding by the doctors to upcharge (and I know they do it) then you don’t hear a peep out of anyone until the government finally catches them.  But they couldn’t care less because only the doctors would be held liable as they signed the “hold harmless” waiver.  Check your contract!  I know about this because I had a fight with my hospital in 2012 about it and they fired me for not signing it.  I had to lawyer up to get my job back.

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Douglas Farrago MD

Douglas Farrago MD is a full-time practicing family doc in Forest, Va. He started Forest Direct Primary Care where he takes no insurance and bills patients a monthly fee. He is board certified in the specialty of Family Practice. He is the inventor of a product called the Knee Saver which is currently in the Baseball Hall of Fame. The Knee Saver and its knock-offs are worn by many major league baseball catchers. He is also the inventor of the CryoHelmet used by athletes for head injuries as well as migraine sufferers. Dr. Farrago is the author of four books, two of which are the top two most popular DPC books. From 2001 – 2011, Dr. Farrago was the editor and creator of the Placebo Journal which ran for 10 full years. Described as the Mad Magazine for doctors, he and the Placebo Journal were featured in the Washington Post, US News and World Report, the AP, and the NY Times. Dr. Farrago is also the editor of the blog Authentic Medicine which was born out of concern about where the direction of healthcare is heading and the belief that the wrong people are in charge. This blog has been going daily for more than 15 years Article about Dr. Farrago in Doximity Email Dr. Farrago – [email protected] 

  1 comment for “Coding Errors and Jail Time

  1. RSW
    October 2, 2017 at 12:13 pm

    Ha ha ha!

    In any well-run private practice, EOBs are examined line-by-line just to prevent this from happenings.

    I guess Agnesian (what a name!) laid off all their claims processors to pay for some new lobby fountains.

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