Providers Continue to be Subject to Wound Care Audits

As we noted previously, Medicare providers of wound care services continue to be the target of audits by Medicare contractors. Wound care services typically involve the application of allografts, skin substitutes, and related products to promote healing and support recovery. Due to the generally high reimbursement rates and need for frequent reapplication of these types of products, the Medicare program views such products as a high risk for improper payments or alleged fraud. Providers who utilize these products for wound care services or who are subjected to audit should understand the contours of an audit and be aware of their rights in responding to an audit.

The Medicare Unified Program Integrity Contractors (UPICs), such as the CoventBridge Group or Qlarant, typically perform these audits. UPICs are charged with the primary goal of investigating instances of suspected fraud, waste, and abuse in Medicare or Medicaid claims. Historically, UPICs are quick to allege that a provider has committed fraud and deny claims for any supposed non-compliance with coverage or documentation requirements, regardless of how minor the perceived deficiency. Providers should be cognizant that a UPIC’s allegation of fraud or non-compliance may bring about significant adverse consequences, especially when such allegations are not disputed. These allegations may be addressed by a timely and well-developed appeal of claims denied by the UPIC.

Wound care services involving skin substitutes and similar products subject to audit are generally denied for reasons such as the following:

• The specific product is considered investigational or experimental;
• Conservative treatment was not documented prior to application of the product;
• Lack of documentation regarding a provider’s decision to utilize one product instead of another product or another course of treatment;
• The product was reapplied too many times or spanning too long of a time period;
• The patient failed to demonstrate significant enough improvement to justify continued use; or
• The product was not used for a “homologous use.”

Medicare claims for wound care services that have been denied and the associated overpayment demands should be disputed, and a provider may respond to the audit and overpayment demands through the same five-level Medicare appeals process available to other categories of denied Medicare claims. An experienced healthcare representative can assist a provider in developing an effective appeal and mounting a strong defense to rebut the denial reasons applied to the claims. If left unconfronted, claim denials of a significant volume or over an extended period of time can cause further consequences for a provider, including additional audits, overpayment demands, and suspension or revocation of Medicare billing privileges.

For over 35 years, Wachler & Associates has represented healthcare providers and suppliers nationwide in a variety of health law matters, and our attorneys can assist providers and suppliers in understanding new developments in healthcare law and regulation. If you or your healthcare entity has any questions pertaining to wound care audits or healthcare compliance, please contact an experienced healthcare attorney at 248-544-0888 or wapc@wachler.com.