ClaimDOC uncovers excessive charges for physician/professional services resulting in huge savings


ClaimDOC’ s comprehensive line-by-line auditing of claims uncovers errors that basic claim repricing and auto-adjudication do not catch, leading to greater savings to health plans and beneficiaries. Our audit team analyzes all types of healthcare claims for a variety of potential concerns including excessive usual and customary charges, duplication of claims, correct coding initiative edits, unbundling of services, improper coding, and others. Our claims review is not intended to impact care decisions or medical practice.

In this Claims Audit Spotlight, we focus on physician (professional) services related to coding, billing, and related charges.

Physician (professional) billing is the reporting of claims for services performed/provided by physicians or other qualified healthcare professionals. Generally, provided services are captured and submitted electronically on the professional and supplier claims using the 837-P or Health Insurance Claim Form (CMS-1500).

Physician/professional services may include a wide variety of services, such as:

  • Evaluation and management (E/M) visits, i.e., office/clinic visits, consultations, emergency room visits, hospital visits, nursing home visits, or others
  • Procedures/treatments such as minor and major surgery, administration of medication(s), and others
  • Diagnostic and/or therapeutic tests performed in the physician office such as radiology, laboratory, EKGs, and others
  • Wellness and prevention, such as counseling and other services

Reimbursement for physician services is usually based on the specific CPT or HCPCS code(s) reported/billed. Pricing for the same service code can vary, depending on the place of service (POS) code reported/billed on the claim. Other factors such as the number of units billed, the use of modifiers, reporting of multiple procedures, correct coding/bundling edits, and other factors may impact physician pricing.

Medical specialty societies work with the American Medical Association (AMA) Current Procedural Terminology (CPT®) Editorial Panel as well as the AMA/Specialty Society RVS Update Committee (RUC) regarding the valuation for CPT codes and make recommendations to the Centers for Medicare and Medicaid Services (CMS).

Case Scenario

A member with the diagnosis of varicose veins of the right and left lower extremities/without complications were seen in the physician’s office setting and underwent the procedure of CPT code 36475. This procedure code is defined as, “Endovenous ablation therapy of incompetent vein, extremity, inclusive of all imaging guidance and monitoring, percutaneous, radiofrequency, first vein treated.” The procedure consists of the physician inserting a specially designed radiofrequency probe through the skin which subsequently destroys the walls of a diseased vein in an extremity.

A physician with an office located in New York submitted two claims to insurance with a total charge of $78,000.00 for treatment of the right leg on one date of service and treatment of the left leg on a different date of service.

Below is an overview of the physician charges billed, related ClaimDOC pricing, and savings.

Claim One

$39,000.00 total physician billed charge for CPT code 36475 LT (left leg)

  • Medicare 2021 pricing based on CPT code 36475, quantity of 1, with place of service (POS) code 11- Office for the locality of New York: $1,635.41
  • ClaimDOC Pricing:  $2,044.26
  • Plan Savings: $37,455.74
  • Percentage of Savings: 95%
Claim Two

$39,000.00 total physician billed charge for CPT code 36475 – RT (right leg), different date of service/four days after first procedure referenced above

  • Medicare 2021 pricing based on CPT code 36475, quantity of 1, with (POS code 11- Office for the locality of New York = $1,635.41.
  • ClaimDOC Pricing:  $2,044.26
  • Plan Savings: $37,455.74
  • Percentage of Savings: 95%

Physician Charges for Services

According to various published pricing/references regarding the cost for treatment of varicose veins reveals there is a wide disparity in physician charges, ranging from $800 to $7,000.  Many factors need to be considered, depending on how much a selected vein needs to be treated, the number/frequency of treatments required, the specific type of procedure performed, whether services are provided with an In-Network or Out-of-Network provider, where the actual service is performed and other factors and considerations.

Published rates from a physician vascular group in Pennsylvania list a charge of $6,396.00 for CPT code 36475. This is a substantial difference from the $39,000 billed by the New York physician for the same service/same CPT code.

The Takeaway

Excessive charges for physician/professional services were identified on the claims. While physicians/other qualified health care professionals may elect and bill any amount they choose for services(s) performed (exception, Medicare’s limiting charge rule if the physician elects to be non-participating with Medicare), the overbilling for services, unbundling of “packaged” services, or incorrect billing can complicate matters for members to understand their bills and payments, impact the collection of patient balances, build a reputation of unbundling services and/or charging high fees, create burdens for uninsured patients and a host of other concerns.

Our goal at ClaimDOC is to use benchmark charges and costs nationally to negotiate fair and ethical payments. Employers turn to us to seek to establish fair reimbursement rates for their plans allowing them to save money and provide richer benefits to their employees. A win-win for everyone.