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Misreporting of Health Billing Down

Bruce Lim was pretty happy. He’s the deputy director in charge of audits and investigations for the Department of Health Care Services. A biannual review of potential fraud in fee-for-service medical billing found that — across the board — there were far fewer financial red flags than in the past.

“Bottom line, the trend lines are very favorable,” Lim said. “The total potential exposure to errors and to potential fraud has decreased. If you look at the positive numbers, 94.5% were billed and paid appropriately, that’s extremely positive.”

The outlier, Lim said, was the adult day health care program, which he said had trouble making sure patients fit “medical necessity” criteria.

“It was not for lack of trying to educate in that arena,” Lim said. “We had 44 training sessions, we spent a lot of time and effort to positively affect that trend.” Lim said that the definition of medical necessity changed in 2008, and that may have caused problems within ADHC.

Lim made it clear that this was not an audit, but an analytic review, that no one is being investigated for fraud, but rather that this review helps proactively identify areas of potential mistakes or abuse.

“It’s a road map,” Lim said, “and once we determine the areas of concern, that gives everyone incentive to do better, and we’re trying to increase the use of technology to improve those numbers.”

Every state does Medicaid fraud reviews, but California is the only one to try to quantify potential concerns like this, Lim said.

“It’s difficult to battle something if you can’t measure it,” Lim said. “So this is our attempt to quantify potential problems, and be proactive about fixing them.”

To save money, California legislators voted to eliminate the state adult day health care program as a Medi-Cal benefit, effective Dec. 1.

According to Lydia Missaelides of California Association of Adult Day Services, a disconnect between ADHC and the state lies in a complicated and unfinished discussion of eligibility criteria.

“They are conducting a paper review of claims, but not discussing their findings with the providers, and often using that to make a clinical judgment about the adequacy of documentation or medical necessity,” Missaelides said. “The so-called errors that they call fraud are not about lack of services provided, but just disagreement about compliance with the eligibility criteria.”

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