Medicare Audits Becoming More Common in Deteriorating Economy

by John Davila, D.C.

Recently, Iowa Senator Grass ley started looking into Medicare’s acknowledgment that the amount of money overpaid to Durable Medical Equipment (DME) providers, due to fraud and abuse, has increased by 44% in the past few years. You may ask, what does this have to do with chiropractic and my practice? The answer is, “A lot!” With the Federal Government feeling the pressure of reduced income and increased expenditures, they are looking at any and all ways to reduce spending, especially for things that shouldn’t have been paid for in the first place.

The answer is, “A lot!”

Even though the cost of drugs far outweighs the amount of money spent on DME, it is the percentage of overpayments, due to fraud and abuse that makes this issue a political football. In chiropractic, we have been saddled with the same issues as DME ever since the 2005 office of the inspector general review of chiropractic. Because of the percentage of claims that should have been denied (67% according to the OIG report), payment for chiropractic care has become a political football that has nothing to do with patient care. To make things worse, within the next year Medicare will have launched recovery audit contractors across the country to review and try to recover part of the $10,000,000,000 overpaid within the Medicare System every year. But, what causes an audit? There are many things that cause an insurance carrier to decide to pick a specific provider of alignment. In the past, the most common causes of an audit were related to billing and coding procedures that took place within the office. But, because of increased scrutiny from the Federal government, there are many new reasons why a provider would be chosen to be audited. Those reasons can range from not charging for services provided, to paying for referrals. So, why does the government care if you give free X-Rays and examinations to Medicare beneficiaries? The answer is simple. The Office of the Inspector General released a special advisory bulletin in August of 2002, titled Offering gifts andother inducements to beneficiaries. The bulletin states: Offering valuable gifts to beneficiaries to influence their choice of a Medicare or Medicaid provider raises quality and cost concerns.Providers may have an economic incentive to offset the additional costs attributable to the giveaway by providing unnecessary services or by substituting cheaper or lower quality services. The use of giveaways to attract business also favors large providers with greater financial resources for such activities, disadvantaging smaller providers and businesses. But, what is considered a valuable gift? The bulletin states: The OIG has interpreted the prohibition to permit Medicare or Medicaid providers to offer beneficiaries inexpensive gifts (other than cash or cash equivalents) or services without violating the statute. For enforcement purposes, inexpensive gifts or ervices are those that have a retail value of no more than $10 individually, and no more than $50 in the aggregate annually per patient. Violating these rules can create harsh penalties for the practice. The bulletin states: A person who offers or transfers to a Medicare or Medicaid beneficiary any remuneration that the person knows or should know is likely to influence the beneficiary’s selection

of a particular provider, practitioner, or supplier of Medicare or Medicaid payable items or services may be liable for civil money penalties (CMP’s) of up to $10,000 for each wrongful act. There are two simple steps that a practice can take to avoid giving an auditor additional ammunition to use against the practice:

1. If you offer gifts to patients in your practice, make sure they are less than $10, no more than five times a year. In addition, the gifts must not be considered an inducement for a reward to create new business from a Federal Healthcare program.
2. Include your staff in all training on compliance issues. This will reduce the chances of a staff member becoming a whistleblower, which is the number one reason why a practice would get audited for offering inducements and expensive gifts to beneficiaries.

Dr. John Davila is a 1994 graduate of Palmer College of Chiropractic in Davenport, IA, and practiced in the Myrtle Beach, SC, area for 13 years. Since 2000, he has been consulting with insurance companies and doctors in private practice in the areas of coding and documentation. In 2001, he re-wrote the Medicare LCD coverage policy for Palmetto GBA (SC Medicare). His company, Compliant Services & Solutions, Inc., helps doctors of chiropractic to ethically maximize their practices, while avoiding audits and repayments to insurance carriers. You can reach Dr. Davila, toll free, at 1-877-322-6203 or by email at This e-mail address is being protected from spambots. You need JavaScript enabled to view it or on the web at

Winning Leaves Marks

by Dr. Eric Kaplan, D.C., F.I.A.M.A.

Early in my chiropractic career, I wanted to know why some doctors made it and others didn’t. I wanted to know what the winners know. Winning and success go hand in hand. If you win, you are a success. So I began my journey; I began searching for the secrets of success 30 years ago. I discovered an interesting principle: success leaves marks. A wise man who had studied success for more than 50 years concluded that the greatest success principle of all was, “Learn from the experts.” I spent my time studying from the likes of Doctors James Parker, Sid Williams, Larry Markson, David Singer, Jim Gregg, John Hoffmann, Ian Grassom, and Dominick LaForte, to name a few. If there was a seminar, I was there, watching, listening observing. Winners win for a reason. There is a system to winning. Winners Learn from the Experts If you want to be a big success in any area, find out what other successful people in that area are doing, and do the same things, until you get the same results. When I studied the interviews, speeches, biographies and autobiographies of successful men and women, I found that they all had one quality in common. They were all described as being “extremely well organized, disciplined, and sincere.” They used their time very, very well. They were highly productive and they got vastly more done in the same period of time than the average person. WINNERS • Set and achieve big goals • Learn and grow from overcoming obstacles • Develop a character of persistence and unshakeable self-confidence • Get the support and cooperation of others • Focus on priorities and concentrate on key tasks • Learn the key skills required for success • Ignore “nay-sayers” and keep their eye on the prize Winners Are Both Effective and Efficient High performing men and women are both effective and efficient. They always do the right things, and they do them in the right way. No person I know is more efficient than my wife. She would not expect less from me; I love her for this. Winners are constantly looking for ways to improve the quality and quantity of their output. As a result, their contributions to their professions have a higher and, therefore, much better result than the contributions of the average person. Average to me is defined as “the best of the worst and the worst of the best.” Don’t be average in your work. In my discussions with hundreds of top doctors over the years, I have found that they all have one thing in common. They have taken the time to sit down and create a clear blueprint for themselves and their future lives. Even if they started the process of goal setting and personal strategic planning with a little skepticism, every one of them has become a true believer. Mark Victor Hansen once said, “You must state it to create it.” Winners Are True Believers Every one of them has been amazed at the incredible power of goal setting and strategic planning. Every one of them has accomplished far more than they ever believed possible in their lives and they ascribe their success to the deliberate process of thinking through every aspect of their work and their lives, and then developing a detailed, written road map to get them to where they want to go. Winners’ Definition of Happiness Happiness has been defined as, “The progressive achievement of a worthy ideal, or goal.” When you are working progressively, step-by-step toward something that is important to you, you generate within yourself a continuous feeling of success and achievement. When a patient comes to your office and you get him or her well, isn’t that achieving a goal; does that not bring a level of happiness? Each time you help a patient, you help yourself and your practice. In your report of findings, set goals for the patient. Achieving these mutual goals will lead to mutual success. A referral from a satisfied patient is a form of success. Winners Determine their Values Personal strategic planning begins with your determining what it is you believe in and stand for. Your values lie at the very core of everything you are as a human being. You must value being a doctor, value the employees that trust their livelihood into your hands, value the patients that trust their wellbeing to you. Your values are the unifying principles and core beliefs of your personality and your character. Winners Build Self-Confidence and Self-Esteem Once you define your values and set your goals, you have begun the exercise in building self-confidence, self-esteem and personal character. When you take the time to think through your fundamental values, the time to set your goals and then commit yourself to living your life consistent with them, you feel a surge of mental strength and well-being. You feel stronger and more capable. You feel more centered in the universe and more competent of accomplishing the goals you set for yourself. Form this day forth, decide for yourself what makes you truly happy and then organize your life around it. Write down your goals and make plans to achieve them. Being a winner, believing in yourself, will make you happier and healthier beyond your dreams. Every patient you help is a win; let your life be filled with victories. Be a winner, help some people today.