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Dr. Joseph O’Connor Improperly Billed MassHealth for $359,266 in Physical Therapy Provided by Physical Therapy Assistants.

Audit found Dr. O'Connor submitted claims to MassHealth for services that were actually provided by physical therapy assistants.

Table of Contents

Overview

Dr. Joseph O’Connor improperly submitted claims to MassHealth using his own billing provider identification number for physical therapy that was provided by physical therapy assistants. According to our review of member medical records, 88 (49%) of the 180 sampled claims were improperly billed to MassHealth using Dr. O’Connor’s billing provider identification number when the services were actually performed by one of his assistants. MassHealth therapy provider regulation Section 432.412 of Title 130 of the Code of Massachusetts Regulations (CMR) does not allow payment for therapy services provided by physical therapy assistants, even if they are provided under the supervision of a licensed therapist. This resulted in at least $359,266 in overpayments during the audit period.

Authoritative Guidance

According to 130 CMR 432.412, MassHealth does not pay for any physical therapy billed under a provider’s name if it is provided by someone under that person’s supervision:

The MassHealth agency does not pay a therapist for any of the following services:

(A) services provided by any person under the therapist‘s supervision.

Additionally, 130 CMR 450.301(A)(1) states that a provider cannot make a claim for services rendered by another person:

An individual practitioner may not claim payment under his or her own name and provider ID / service location number for services actually provided by another individual, whether or not the individual who provided the service is also a participating provider, or is an associate, partner, or employee of the individual practitioner.

Reasons for Issue

Dr. O’Connor stated that his previous billing company had used his billing provider identification number for all physical therapy, as it was the fastest way to submit claims. He also stated that previously, he was unsure of how to bill for services provided by his employees and had tried to gain clarification on the issue from MassHealth.

Recommendations

  1. Dr. O’Connor should collaborate with MassHealth to establish a plan to repay the $359,266 in overpayments he received from improper physical therapy billings.
  2. Dr. O’Connor should bill MassHealth using his billing provider identification number only for services he personally provides.
  3. Dr. O’Connor should periodically review all the billing requirements in MassHealth’s regulations, as well as updates to these regulations that are described in MassHealth’s transmittal letters and provider bulletins, and ensure that he knows and adheres to these requirements when he bills for services provided to MassHealth members.

Auditee’s Response

On Dr. O’Connor’s behalf, his legal counsel provided the following written response, dated November 19, 2019, along with supporting documentation.

Since its founding, [Advance Physical Therapy & Sports Rehabilitation] has always utilized both physical therapists and physical therapy assistants in a team approach when treating patients in its office. My client has found that this team approach has been ideal. The physical therapist assistants have always followed the physical therapist’s plan of treatment, which has allowed the physical therapist to evaluate, establish a treatment plan and treat other patients jointly with physical therapist assistants. This is very common practice in clinical physical therapy clinics throughout the Commonwealth of Massachusetts. . . .

The current clinical staff is comprised of two physical therapists and three physical therapy assistants. This provides an adequate ratio between clinicians, patients, and staff to ensure appropriate treatment is rendered daily. . . .

A. It is undisputed that physical therapists and physical therapy assistants are legally authorized to provide physical therapy treatment pursuant to M.G.L. C. 112, Section 23B. . . .

Physical therapy assistants must be under the supervision and direction of a physical therapist whenever working. . . .
Section 5.02 delineates the use of supportive personnel as well as the responsibility and supervision of same. These legal and regulatory schemes insure, to the greatest extent possible, that proper, reasonable and appropriate treatment will be rendered to physical therapy patients throughout the Commonwealth.

B.   Application of 130 CMR 432.413 and 450.301(A)(I)

The authoritative guidance cited in the audit report lists firstly 130 CMR 432.413 as the primary source for denying payment for any physical therapy billed under a provider’s name if it is provided by someone under that person’s supervision:

The MassHealth Agency does not pay a therapist for any of the following services: (A) Services provided by any person under the therapist’s supervision.

The exact language of (A) is as follows:

“The therapist provided the service in a facility approved by the MassHealth Agency and is paid by the facility to provide that service, whether or not the cost of the service is included in the MassHealth Agency’s rate of payment for that facility.” The conclusion reached in the audit of “any person” under the therapist’s supervision from this language is not readily ascertainable nor interpreted in (A).

Even if this conclusion is reasonably reached, the Audit does not specifically identify, in detail, any unlicensed physical therapists that provided services (130 CMR 450.212(A)), and further, what number of the total number of claims paid that joint treatment occurred between a physical therapist and a physical therapy assistant. The question is what treatment was attributable to the physical therapist versus the physical therapy assistant. The treatment notes were readily available and could have been reviewed to answer this question.

C.   In reviewing the audit, the total amount of monies paid by MassHealth were listed for each of the four years that were the subject of the audit. Upon further analysis of the chart on page three of same, it appears that if claims equals patient visits, then the average course of a therapy regimen would be approximately twenty-four visits for each patient and the average reimbursement amount would be approximately $17.00 per claim. This seems like an unusually high number of visits and a very low amount paid for services rendered. However, these amounts did not disclose whether or if these totals were secondary or primary MassHealth payments.

Many of Advance’s patients are also the recipients of Medicare, which always serves as the primary payer . . . when an individual is using both modes of public coverage. Medicare pays the initial eighty percent of the allowed amount and MassHealth pays the remaining percentage of its allowed amount. Since Medicare allows the use of physical therapy assistants my client was in full compliance with its rules and regulations. It is unfair to Advance to not be paid by MassHealth after providing primary services to Medicare patients and being in full [compliance] with its regulations. . . . It is my client’s understanding that in the near future, MassHealth will authorize and pay physical therapist assistants, which at that time, both public health programs will be in full uniformity.

If the random sample of 180 claims examined and the total number of claims paid cannot be separated by primary and secondary MassHealth payments, with the differing treatment policies, then the validity of the methodology used has to be called into question.

MassHealth’s Response

In its response, MassHealth provided the following comments:

MassHealth has worked diligently with the Provider Compliance Unit (PCU) and the Office of Clinical Affairs (OCA) to identify therapy claims submitted for services provided by therapy assistants. MassHealth, in coordination with PCU and/or OCA, has conducted audits of therapy providers to identify other instances of noncompliance with MassHealth regulations. Additionally, MassHealth works with the Third Party Administrator for Long Term Services and Supports (LTSS TPA) to audit and develop program integrity algorithms to ensure provider compliance with the overall administration of the therapy program.

MassHealth is committed to the continued integrity of its Therapy program and will continue the agency’s program integrity efforts in collaboration with the LTSS TPA and OCA. Furthermore, MassHealth will continue engaging with the therapy provider network to ensure comprehensive understanding of MassHealth regulations and guidelines, and to offer additional opportunities for provider education.

Regarding the audit finding and recommendations in the audit, MassHealth agrees with the . . . recommendations.

MassHealth also stated in its response that it would “follow through with its own audit of Dr. O’Connor to determine the amount of repayment.”

Auditor’s Reply

As noted above, MassHealth regulations do not allow payment for therapy services provided by physical therapy assistants, even if they are provided under the supervision of a licensed therapist. Also, MassHealth does not enroll physical therapy assistants; therefore, they are ineligible for certification that would allow them to bill MassHealth for services they provide. All therapy services provided to MassHealth members must be performed and billed only by a licensed therapist, and each licensed therapist must be separately enrolled as a MassHealth therapy provider using his/her own individual identification number.

Despite the assertion of Dr. O’Connor’s legal counsel, the question of which treatment was attributable to the physical therapist and which was attributable to the physical therapy assistant is moot, as Dr. O’Connor used his billing provider identification number for each of the paid claims although he provided none of the services questioned in our report. This is contrary to MassHealth regulations that state that a provider cannot make a claim for services rendered by another person. Also, Dr. O’Connor’s legal counsel incorrectly states,

The authoritative guidance cited in the audit report lists firstly 130 CMR 432.413 as the primary source for denying payment for any physical therapy billed under a provider’s name if it is provided by someone under that person’s supervision.

The report cites 130 CMR 432.412, which states that MassHealth does not pay for any physical therapy billed under a provider’s name if it is provided by someone under that person’s supervision. It also cites 130 CMR 450.301(A)(1), which states that a provider cannot make a claim for services rendered by another person.

Dr. O’Connor’s legal counsel also states that our audit did not take into consideration the various other insurance programs for patients besides Medicaid, such as Medicare. Our audit only questions the unallowable payments made directly by MassHealth’s Medicaid program. None of the payments in question were outside that scope. The audit sampling method the Office of the State Auditor (OSA) used to select and extrapolate our sample to obtain our results is described in the “Audit Objectives, Scope, and Methodology” section of this report and is based on sound statistical sampling techniques. OSA will share this information with MassHealth and Dr. O’Connor in the process of resolving the issues identified in this report.

Dr. O’Connor’s legal counsel questions the method of projecting the overpayment and whether the sample was random. In conducting our sampling, OSA used RAT-STATS, a statistical sampling program created by the Office of Audit Services within the US Office of Inspector General in the US Department of Health and Human Services. This software determines a statistically appropriate sample, giving consideration to the total size of the population, expected error rate, confidence level, and desired precision, which are defined in the “Audit Objectives, Scope, and Methodology” section of this report. RAT-STATS is widely used by audit agencies and is recognized by MassHealth as the sampling software of choice for evaluating provider claims using a statistical sampling method. Once the sample size was determined, OSA used Audit Command Language, which is a data analysis software program recognized statewide, to select a random sample of claims paid to Dr. O’Connor. OSA’s sampling method was sound and consistent with applicable professional standards.

Based on the issues we identified with Dr. O’Connor’s billing practices during this audit, we urge that he implement our recommendations and work with MassHealth to resolve this matter.

Date published: January 13, 2020
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