You need to have it both ways: Audits must target missed coding opportunities and invalid conditions in risk adjustment

By Brian Murphy

Among the alleged behaviors that led to Kaiser’s eventual $556M payout to settle false claims act allegations was its aggressive effort to only add diagnosis codes (up to a year or more after the encounter) and never remove them.

This is called a one-way audit, and the Department of Justice does not approve.

You can report additional diagnoses that are code-able and treated, but you also have to remove them when they’re unsupported.

My recent guests on the Off the Record podcast Mary Inman and Liz Soltan give an insider’s look at the practice in a can’t-miss episode.

New OIG Program Guidance released in February also paint one-way chart reviews as potentially fraudulent/abusive conduct that will draw federal scrutiny. From that guidance (see p. 20 of link below), questionable risk adjustment behaviors include:

• Using chart reviews to identify additional diagnoses that increased risk scores inappropriately
• Failing to remove diagnosis codes previously submitted to CMS when chart reviews provide information that those codes were unsupported or otherwise invalid
• Conducting in-home HRAs to generate additional diagnoses that were not considered in the care, treatment, or management of the enrollees or that were otherwise unsupported
• Querying physicians via electronic medical record platforms (including prompts generated by artificial intelligence algorithms) or otherwise prompting physicians to add risk-adjusting diagnoses that patients did not have or that did not affect the care, treatment, or management of the patient
• Providers submitting diagnoses that were not supported by the enrollees’ medical records to inflate the payments MAOs made to the providers under risk-sharing or other arrangements.

Regulatory winds are shifting against this practice, too. The CMS 2027 Advance Notice proposes to exclude diagnoses associated with unlinked chart review records (CRRs) from risk score calculation. MA plans currently submit linked and unlinked CRRs for payment. Linked CRRs are CRRs with diagnoses that appeared in a previously submitted encounter data record—i.e., coded by a provider as a diagnosis that was addressed during a prior visit. Unlinked CRRs are CRRs with diagnoses that do not appear in a separate encounter data record.

Note that this change is proposed only, but I’d be surprised if it wasn’t made final. One Direction might be a fine band that can dance, but as a risk adjustment mantra it’s going to get you in trouble.

All that said, fear should not rule the day. Many organizations are leaving RAF on the table because they haven’t yet mastered the basics of chart review and surfacing relevant clinical conditions.

References

• Off the Record podcast, A reckoning for Medicare Advantage: Inside the Kaiser case with Mary Inman and Liz Soltan
• OIG, Medicare Advantage Industry Segment-Specific Compliance Program Guidance: https://oig.hhs.gov/documents/compliance/11464/ma-icpg.pdf