Audit Activity

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  • March 12, 2020


In response to the recent increase in providers reaching out to us regarding audits, we want to remind you of a few basics. First, the Centers for Medicare and Medicaid Services (CMS) healthcare audit programs include the Unified Program Integrity Contractors (UPICs) audit program, the Recovery Audit Contractor (RAC) program, and the Comprehensive Error Rate Testing (CERT) program. It is important to identify the entity that is auditing you.

E/M Services Billed with Modifier 25

There has been an increase in audits on evaluation and management (E/M) services billed on the same day as chemotherapy. We know that the American Medical Association (AMA) CPT and Medicare guidelines state that medically necessary, significant and separately identifiable E/M services are payable when billed on the same day as drug administration services.  What is less clear is the criteria payers use to determine that the E/M service is significant and separately identifiable.

Some basic tips:

  • If the E/M service documentation only demonstrates that the service was to review labs and determine if the patient should continue treatment that day it likely would not be considered significant and separately identifiable.
  • Although a different and distinct diagnosis is not required, all appropriate diagnosis pertaining to the E/M service should be included. Evaluation of the disease process and any issues unrelated to the chemotherapy administration should be documented.

Monitor the payer’s policies and guidance on use of modifier 25 – below are a few examples of such policies:

Novitas Solutions Modifier 25 Tip Sheet:

Noridian Healthcare Solutions E/M Services and Drug Administration Billing

UnitedHealthcare Oxford Injection and Infusion Services Policy February 2020

Moda Health Policy

RAC Audits on Drug Waste and Modifier JW

The RACs continue their audits on the use of modifier JW and wasted drug. Oplinc has been made aware of instances when the wasted drug was inadvertently billed incorrectly and was not identified on a separate claim line with modifier JW appended. If the total amount of the drug billed and reimbursed is the same as it would have been had the modifier JW been correctly appended to the wasted portion, this does not represent an overpayment and I would dispute any effort by the RAC to recoup the payment.

As always, it is important to keep up with billing rules/regulations and the issues that the audit contractors are looking at. Performing regular internal practice audits will help keep you safe and prepared. Please contact Oplinc at if you would like to share/discuss current audit issues you are experiencing.