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Excessive Use of Multiple Removal Codes – Dermatology Fraud and Abuse

Tuesday, June 27th, 2017

Criminal Conviction of Dermatologist Excessive Use of Multiple Removal Codes – 2015

dermatology false claimsA Chicago area dermatologist was convicted of committing Medicare fraud by submitting false claims for more than 800 patients that led to payment of reimbursement of approximately $2.6 million.  The doctor was accused of falsely diagnosing patients and submitting bills without proper documentation of the necessary condition.  Most of the claims appear to have involved diagnosis of actinic keratosis, or sun-induced skin lesions that have potential to become cancerous.   The doctor was found guilty of criminal charges arising from this matter in 2015.

The dermatologist was alleged to have falsely documented hundreds of cases of medically unnecessary cosmetic treatments he reported as involving the removal of lesions (CPT 17004).  According to court records, the physician billed under the CPT code applicable to the removal of 15 or more lesions on a more or less routine basis.  These treatments were allegedly performed on hundreds of repeat patients over a number of years.  Many of the patients received this treatment on 10 or more visits.  Medicare reimbursed this treatment by paying up to $352.40 per treatment.  When these numbers are summarized, it becomes difficult to deny that abuse was going on in this case.  Evidence presented suggested the dermatologist falsely claimed to have removed more than 150 pre-cancerous lesions from approximately 350 Medicare patients, more than 450 patients covered by Blue Cross and Blue Shield, and additional patients covered by Aetna and Humana health insurance.

This case appears to have been a relatively clear case of actual fraud rather than failure to properly document the nature of the service.  Even though the case represents an extreme situation, it still holds some lessons for providers who are not attempting to commit fraud.  A few lessons that can be extracted from this case include:

  • Care should be taken when using multiple removal codes such as 17004.  These types of codes should not be used systematically.  Over time, the removal numbers add up to indicate potential fraud.
  • The record should be accurately and completely documented to support use of multiple removal codes.
  • Care should be taken not to bill codes relating to time increments or work units that, in the aggregate, result in an unrealistic amount of time in a given day.  Granted, some providers are more efficient than others, but at some point multiple procedure time units become excessive and can be statistically sampled to determine whether the individual doctor is within a standard range of services.

John H. Fisher

Health Care Counsel
Ruder Ware, L.L.S.C.
500 First Street, Suite 8000
P.O. Box 8050
Wausau, WI 54402-8050

Tel 715.845.4336
Fax 715.845.2718

Ruder Ware is a member of Meritas Law Firms Worldwide

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