Each procedure that your doctor or other health care provider performs has a billing code. This code is called the CPT code or Current Procedural Terminology. Providers use these codes when they submit claims to insurance companies or Medicare. The code determines how much your provider will be paid. Because there are thousands of billing codes, mistakes can happen. These billing errors can be fixed if you call the mistake to the attention of the provider. By changing the codes, providers can get paid differing amounts of money. When providers use the correct codes for the procedures actually done, they get paid what they are due.
How billing fraud happens
Billing fraud happens when health care providers file claims, knowing they are not correct. When they manipulate the coding system to their advantage, we all pay as taxpayers and premium payers. This can happen several ways.
- Upcoding: The doctor or other health care provider provides a service, but lists a billing code for a more complicated or lengthy procedure that pays more. For example, a brief office visit could be coded as an extensive visit. Group psychotherapy could be billed as if it were an individual session. Routine medical transportation could be coded as emergency life support transportation. A cold could be coded as pneumonia. Tests done by technicians could be coded as being done by physicians. By using codes for more serious procedures with higher rates of payment, providers can significantly increase how much they are paid.
- Unbundling: Some codes are meant to include a group of procedures commonly done together, such as cleaning a wound, stitching it and applying a dressing. Using three separate codes when there is one code for the procedure is called unbundling. It is illegal, but it can increase profits.
- Double billing: This happens when the same bill is submitted multiple times when the procedure was performed only once.
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