Last week the Health and Human Services Office of Inspector General (OIG) issued an OIG Portfolio entitled, “Medicare Needs Better Controls to Prevent Fraud, Waste, and Abuse Related to Chiropractic Services.” In the Portfolio, OIG consolidated a number of findings from previous reports, audits, investigations, and the recommendations that came out of those various items, as they related to the history of payments for chiropractic care by the Medicare program. The Portfolio discusses recommendations from prior reports that have either not been implemented or not implemented effectively by the Centers for Medicare & Medicaid Services (CMS).

The Portfolio begins with a recitation of statistics. CMS’s Comprehensive Error Rate Testing Program, which measures improper Medicare fee-for-service payments annually, identified chiropractic care as having the highest error rate of all measured Medicare Part B services from 2010 to 2015. The improper payment rate ranged from 43.9 percent to 54.1 percent (as compared to a range of 9.9 percent to 12.9 percent for all Part B services), with overpayments per year ranging from $257 million to $304 million. In total, Medicare paid over $2.9 billion for chiropractic services over the 6-year period.

The OIG’s review of prior work and current analysis cited the following issues:

  • Medicare continued to make hundreds of millions in improper payments for chiropractic services.
  • CMS’s controls have not fully prevented improper payments.
    • Nearly all chiropractic claims are submitted with the “AT Modifier” regardless of whether the services were for active/corrective treatment as opposed to maintenance therapy (which is not covered).
    • Chiropractors are not documenting medical necessity for treatment.
    • Available means of educating chiropractors on proper billing procedures have been ineffective.
    • Contractors have not widely used medical reviews to assure that chiropractic treatments have met requirements of medical necessity. 
  • Chiropractic fraud is a concern
    • OIG has completed investigation of 25 cases of chiropractic fraud since 2005.
    • Chiropractors have submitted claims for services that were never provided or were medically unnecessary; offered incentives to patients to receive unnecessary services; provided services without a valid chiropractic license; falsified patient records; and billed for chiropractic services but provided services not covered by Medicare (massage and acupuncture).
    • As a result of the investigations, 11 chiropractors went to jail and $7.6 million was paid in restitution and settlements.
    • From 2005 through 2016 542 chiropractors were excluded from Medicare for various periods.
  • Establishing a medical review threshold for chiropractic services could save millions by reducing payments for medically unnecessary services without compromising beneficiary access to reasonable and necessary services
    • Other services have review thresholds, including outpatient physical therapy and speech-language pathology
    • Private insurers set limits on chiropractic services
    • Statistically, the greater the number of chiropractic services received by a Medicare beneficiary, the more likely that the services are medically unnecessary.

Based on the above findings, the OIG made the following recommendations:

1. CMS should work with its contractors to educate chiropractors on the training materials that are available to them;

2. CMS should educate beneficiaries on the types of chiropractic services that are covered by Medicare, inform them

that massage and acupuncture services are not covered by Medicare, and encourage them to report to CMS chiropractors

who are providing non-Medicare-covered services;

3. CMS should identify chiropractors with aberrant billing patterns or high service-denial rates, select a statistically

valid random sample of services provided by each chiropractor identified, review the medical records for the sampled

services, estimate the amount overpaid to each chiropractor, and request that the chiropractors refund the amounts

overpaid by Medicare; and

4. CMS should establish a threshold for the number of chiropractic services beyond which medical review would be

required for additional services. 

CMS has responded to the recommendations with a somewhat marked lack of enthusiasm. It specified that it continually works to educate both providers and beneficiaries (items 1 and 2) and indicated that it does not concur with recommendations 3 and 4, citing current systems utilized to track suspicious billing patterns and detect fraud waste and abuse, while also noting the chiropractic services account for less than 1 percent of the total improper payments for Medicare fee-for-service. CMS stated that it is committed to using its limited resources to most efficiently address fraud, waste and abuse.