OIG adds Medicare Part B psychotherapy services to Its audit list for 2021

In December 2020, the U.S. Department of Health and Human Services (HHS) Office of the Inspector General (OIG) updated the list of its active work plan categories that will be subject to audit in 2021. This list is an underutilized official preview of what healthcare providers should expect – and therefore focus on – in terms of fraud and abuse and compliance audits from the government. The list is free and publicly available to all. The newly published 2021 list notably includes review of standard Medicare Part B payments for psychotherapy services, as well as telehealth services provided during the Coronavirus Public Health Emergency (PHE).

Overview of Targeted Psychotherapy Services

For purposes of the OIG work plan, psychotherapy is the treatment of mental illness and behavioral disturbances in which a physician or other qualified healthcare professional establishes professional contact with a patient and, through therapeutic communication and techniques, attempts to alleviate emotional disturbances, reverse or change maladaptive patterns of behavior, to encourage personality growth and development. Psychotherapy services have grown considerably in recent years and experienced a significant increase in frequency of Medicare reimbursement during 2020, primarily due to the expanded use of telehealth, consequently drawing scrutiny by the OIG.

Common psychotherapy CPT Codes (also performed via telehealth) include:

• Psychotherapy (90832, 90833, 90834, 90836, 90837, 90838)
• Psychotherapy for crisis (90839, 9080)
• Group Psychotherapy (90853)
• Family Psychotherapy (90846, 90847)

Heightened Risk of Inadequate Documentation

A prior OIG review found that, in 2003, Medicare reimbursed $185 million in inappropriate outpatient mental health services, which were inadequately documented and should not have been covered. Under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, § 1135 of the Social Security Act, and retroactive to March 2020, at the beginning of the PHE, the Secretary of HHS authorized the Centers for Medicare and Medicaid Services (CMS) to implement various waivers and modifications to the Medicare requirements and conditions of participation for telehealth. Thanks to these CMS waivers and the flexibilities granted thereunder, during the PHE, Medicare beneficiaries have been able to access psychotherapy services safely, conveniently, and at a greater pace than ever through telehealth. The OIG considers this uptake in virtual care as increased a risk for healthcare fraud and abuse and at best, the potential for lax medical documentation, which make an easy target for CMS’ efforts to recover overpayments due to lack of medical necessity.

Surge in Psychotherapy During the PHE Leads to OIG Audits in 2021

A preliminary OIG analysis of psychotherapy services provided during the first 8 months of 2020 has already determined that 43% of Medicare payments made to providers were for services performed via telehealth compared to less than 1% of services performed via telehealth in 2019. As a result, the OIG is intent on conducting audits of Medicare Part B payments for psychotherapy services provided via telehealth in 2020 to determine whether the services were submitted in accordance with Medicare documentation and other requirements. A nationwide audit of psychotherapy services will be included in the OIG’s initial audit phase of Medicare Part B telehealth services provided during the PHE and then, OIG will conduct further audit for standard psychotherapy services.

From OIG Reports to Further Audits

An OIG audit initially results in a detailed report of findings. However, any healthcare providers negatively identified by the OIG can then be subject to further audits, overpayment demands, or other administrative reviews and sanctions over a lookback period of at least six years. Click here to view a recent sample OIG provider audit report involving psychotherapy services. In this real life case published in July 2020, randomly sampling through 23,947 claims for psychotherapy services, the OIG unveiled $3.3 million in Medicare overpayments due to, among other things, a lack of adequate documentation and the use of a non-compliant electronic health records (EHR) system which did not maintain a history of beneficiaries’ treatment plans and failed to capture “real time” electronic signatures. This report is a stern warning for what is yet to come in 2021. All psychotherapy providers should take note and review their respective documentation practices against Medicare requirements before the OIG knocks on the door.

For additional information on the OIG’s work plan and how to prepare or respond to potential OIG or Medicare audits, please contact the attorneys below.