Home > Hospital and Medical Practice Management > Health Insurance Company Scheme Alert: Downcoding

Health Insurance Company Scheme Alert: Downcoding

Physicians are finally beginning to drop insurance carriers due to the downcoding “scam” that insurers are using in order to greatly enhance their profits. Downcoding specifically is when an insurer unilaterally decides after services have been rendered to reduce the amount of reimbursements a physician (even hospital) can receive. According to the American Medical Association, most physicians believe this practice is a scam aimed directly at giving insurers as much profit as possible and this specific issue is what physicians complain to the AMA the most about.
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CPT Codes Most Downcoded by Insurance Company:
Code:                                                    Medicare Rate:                                         Usual Downcoding Amount
99205 (new pt office visit)               $213.60
99204 (level 4 new office visit)       $170.47                                                      $43.13
99203 (leve 3 new office visit)         $110.92                                                       $59.55
99202 (level 2 new office visit)        $76.88                                                        $34.04
99201  (level 1 new office visit)        $44.77                                                         $32.11
99215  (level 5 established patient)  $149.60
99214  (level 4 established patient)  $111.39                                                      $38.21
99213  (level 3 established patient)   $74.46                                                      $36.93
99212  (level 2 established patient)   $44.77                                                      $29.69
99211 (level 1 established patient)     $22.39
9234 (outpatient observation)            $142.68
99233 (level 3 hospital progress note)   $108.67                                                $34.01
99232 (level 2 hospital progress note)   $75.78                                                  $32.89
99231 (level 1 hospital follow up)            $42.12                                                  $33.66

Average % difference between usual downcoding amount and normal Medicare rate is 49%.
( Source 2)
—————————————————————————————————————————————— Aetna
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– Paid $6,270,000 settlement for downcoding dentist claims  (Source 3)
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Blue Cross Blue Shield
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– downcoded Anesthesiologist claims (Source 4)
-downcoded Urologist claims in Kansas (Source 4)
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Humana
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Physician exposes massive  “scam” run by Humana (Source 1)
– Humana underpaid by $108.47 on code 99215 when should have paid $149.60
-Humana underpaid by  $27.13 on code 99213 when should have paid $74.46
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Sources:

1. http://www.wejonesmd.com/Pages/Ins/humana.html
2. http://www.mtbc.com/learningcenter/index.php/steps-your-practice-can-take-to-prevent-downcoding-on-medical-claims/
3. http://articles.baltimoresun.com/2003-08-20/business/0308200151_1_aetna-dentists-dental-association
4. http://www.ama-assn.org/ama/pub/physician-resources/legal-topics/litigation-center/case-summaries-topic/managed-care-payments.page

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Keywords: medical coding, medical billing, health care insurance, health plan, united healthcare, humana, blue cross blue shield

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