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Audit of the Office of Medicaid (MassHealth)—Review of Claims Submitted by Dr. Frederick Wagner Jr. Objectives, Scope, and Methodology

An overview of the purpose and process of auditing the Office of Medicaid (MassHealth)—Review of Claims Submitted by Dr. Frederick Wagner Jr.

Table of Contents

Overview

In accordance with Section 12 of Chapter 11 of the Massachusetts General Laws, the Office of the State Auditor (OSA) has conducted a performance audit of certain claims by Dr. Frederick Wagner Jr. for the period July 1, 2014 through December 31, 2017.

We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.

Below is our audit objective, indicating the question we intended our audit to answer, the conclusion we reached regarding our objective, and where the objective is discussed in the audit findings.

Objective

Conclusion

  1. Did Dr. Wagner properly bill MassHealth for vision care services, including transportation and ordering and dispensing of eyewear, provided to its members?

No; see Findings 1 and 2

Methodology

We gained an understanding of the internal controls we deemed significant to our audit objective through inquiries. In addition, we performed the following procedures to obtain sufficient, appropriate audit evidence to address our audit objective.

We obtained data from MassHealth’s Medicaid Management Information System (MMIS) for testing purposes. To test the reliability of these data, we relied on the work performed by OSA in a separate project that tested certain information system controls in MMIS. As part of that work, OSA reviewed existing information, tested selected system controls, and interviewed knowledgeable agency officials about the data. Additionally, we performed validity and integrity tests on all claim data, including (1) testing for missing data, (2) scanning for duplicate records, (3) testing for values outside a designated range, (4) looking for dates outside specific periods, and (5) tracing a sample of claims queried to source documents. Based on these procedures, we determined that the data obtained were sufficiently reliable for the purposes of this report.

Effective April 6, 2018, MassHealth revised Chapter 402 of Title 130 of the Code of Massachusetts Regulations. For the purposes of our audit, OSA used the prior regulations that were in effect during the audit period, January 1, 2014 through December 31, 2017.

We selected a statistically random sample of 180 out of 35,385 paid vision care claims from the audit period, using an expected error rate of 50%, a desired precision of 15%, and a confidence level of 95%, to determine whether Dr. Wagner properly billed MassHealth for these services. The expected error rate is the anticipated rate of occurrence of the error of improper billing for services; 50% is the most conservative. Desired precision is a measure of how precise the actual error rate is. Confidence level is the numerical measure of how confident one can be that the sample results reflect the results that would have been obtained if the entire population had been tested. For this audit, we designed our sample so that we would be 95% confident that the actual error rate in the sample of 180 claims would be within a range of +/- 7.5%, or 15%, of the error in the population of 35,385 claims.

To determine whether Dr. Wagner properly billed MassHealth for vision care, we reviewed information in members’ medical records for the sampled claims, including the date of service, the referring physician, the description of the chief complaint, and the other components required for evaluation and management (E/M) services. Also, we determined the number of members seen on each date of service in our sample, the number of facilities Dr. Wagner visited per day, and the hours he worked per day. Additionally, we ran queries from MMIS of all the services for each member in our sample to determine whether they also received vision care from other providers.

We performed the following additional procedures to verify that Dr. Wagner provided vision care to MassHealth members living in nursing facilities:

  • We interviewed all 40 nursing facility medical directors and/or nursing directors from our sample of 180 claims about their processes for securing specialty vision care for nursing facility residents, including the services provided by Dr. Wagner. We also discussed the procedures Dr. Wagner followed when he arrived at a nursing facility, including who requested his services, what types and levels of services he provided, what types of equipment he brought, what types and amount of documentation he provided to the nursing facility, and how he dispensed eyeglasses (mailed or fitted to the member in person).
  • For claims billed using procedure codes 99304, 99305, 99306, 99308, 99309, and 99310, we obtained and reviewed Dr. Wagner’s supporting documentation from the facilities as well as the documentation that Dr. Wagner personally maintained. Our review consisted of examining whether Dr. Wagner properly documented the services provided, including whether his documentation contained all of the required components for billing for higher-complexity E/M services in accordance with the Centers for Medicare & Medicaid Services’ 1995 and 1997 Documentation Guidelines for Evaluation and Management Services.

We did not project the results of our tests related to the wrong dates of service billed (Finding 1) to the entire population because we determined that there was no monetary value to report.

To determine whether Dr. Wagner properly billed for eyeglass dispensing services, we performed the following tests:

  • We compared all 1,987 paid dispensing service claims to orders for materials for the member associated with each claim to determine whether Dr. Wagner placed the material order with MassHealth’s optical supplier, Massachusetts Correctional Industries, and we reviewed the timing of his submission of claims for dispensing services.
  • We reviewed all member medical records provided by Dr. Wagner for our sample of 180 claims. Specifically, we looked for a documented consultation, measurements, and evidence that he fitted the eyeglasses to the member’s face.
  • We interviewed all 40 nursing facility medical directors and/or nursing directors from our sample of 180 claims and requested any related dispensing documentation from the facilities; we then compared it to the documentation Dr. Wagner maintained at his office.

In addition, we determined how many days Dr. Wagner traveled during the audit period and the number of facilities to which he traveled. We then determined how much he would have been paid if MassHealth had reimbursed him for non-emergency travel based on the number of facilities visited rather than the number of members who received services at each facility.

Finally, we worked with MassHealth by communicating our audit objectives, scope, and methodology. MassHealth had previously shared with OSA its concerns about Dr. Wagner’s billing practices for the period January 1, 2014 through December 31, 2017.

Date published: September 24, 2019
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