Med Center builling practices under review

and Maisie Wong Last month the Hospital of the University of Pennsylvania agreed to pay $30 million to the federal government in order to settle Medicare claims that Medical Center physicians overbilled patients. The settlement came as a result of an extensive audit of HUP -- including the Clinical Practices of the University of Pennsylvania -- spanning the years 1989 to 1994. In addition to the $30 million payment, the University promised to implement a corrective action plan designed to prevent the reoccurrence of such incidents. According to the settlement agreement issued by the United States Department of Justice, payment is due "on the 30th day following the date of execution of this Agreement." William Kelley, chief executive officer of the University Medical Center and Health System, adamantly denied any CPUP wrongdoing. Former Chief of General Internal Medicine John Eisenberg said there were two parts to the investigation. "One part dealt with the supervision of physicians and the other [examined] the billing problems," explained Eisenberg, who now works at Georgetown University Medical Center. According to federal authorities, CPUP physicians were indicted for several violations of the Medicare billing code. The audit uncovered that doctors had not only overbilled Medicare, but had also provided inadequate documentation of their services. The audit also found that the physicians had submitted bills for work done by residents. Since Medicare is a public insurance company, it does not allow bills for residents' work to be submitted because residents' salaries are already subsidized by the federal government. The corrective action plan consists of four parts -- the centralization of billing operations, mandatory annual financial audits, intensive training of physicians and billing personnel on the correct Medicare procedures, and the establishment of two telephone hotlines devoted to billing problems. Eisenberg said the overbilling was not an organized attempt to finagle more money from unsuspecting patients and their insurance companies. The allegations have caused an uproar in the medical community, prompting other health care facilities to implement similar physician education programs, he added. The indictment has also spurred a Blue Shield investigation of CPUP's billing practices, according to Blue Shield spokesperson Douglas Smith. Smith said the investigation was launched after government and Blue Shield officials received an anonymous letter informing them of the billing abuses. Government investigators, however, insist that the University was chosen at random for the investigation. Eisenberg said the billing errors are probably due to a misinterpretation of the Medicare billing code. "The real irony of the situation is that the Medicare commission came out with a new set of rules a week before the Penn investigation," he said. Ambiguity and confusion on the part of health care providers has led billing personnel to create their own rules when dealing with Medicare claims, according to Eisenberg.