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CPT fee differentials and visit upcoding under Medicare Part B

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  • Christopher S. Brunt

Abstract

Medicare Part B pays outpatient physicians according to the billed Current Procedural Terminology (CPT) codes, which differ in procedure and intensity. Since many performed services merely differ by intensity, physicians have an incentive to upcode services to increase profitability of a visit. Using nationally representative data from the 2001 to 2003 Medicare Current Beneficiary Survey, this paper explores the effect of Medicare Part B fee differentials on the upcoding of general office visits (i.e. for established patient visits with CPT codes of 99212‐99215). It finds strong evidence that these fee differentials influence physician's coding choice for billing purposes across a variety of specialties. For general office visits, Medicare outlays attributable to upcoding may sum to as much as 15% of total expenditures for such visits. Medicare has much to gain financially by clarifying its classification rules. Until the distinctions between types of Medicare visits are redefined in a way that eliminates ambiguity, upcoding under Medicare Part B is likely to continue. Copyright © 2010 John Wiley & Sons, Ltd.

Suggested Citation

  • Christopher S. Brunt, 2011. "CPT fee differentials and visit upcoding under Medicare Part B," Health Economics, John Wiley & Sons, Ltd., vol. 20(7), pages 831-841, July.
    • Handle: RePEc:wly:hlthec:v:20:y:2011:i:7:p:831-841
    DOI: 10.1002/hec.1649
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    Cited by:

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    3. Bowblis John R. & Brunt Christopher S. & Grabowski David C., 2016. "Competitive Spillovers and Regulatory Exploitation by Skilled Nursing Facilities," Forum for Health Economics & Policy, De Gruyter, vol. 19(1), pages 45-70, June.
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    5. Cook, Amanda & Averett, Susan, 2020. "Do hospitals respond to changing incentive structures? Evidence from Medicare’s 2007 DRG restructuring," Journal of Health Economics, Elsevier, vol. 73(C).
    6. Christopher S. Brunt, 2015. "Medicare Part B Intensity and Volume Offset," Health Economics, John Wiley & Sons, Ltd., vol. 24(8), pages 1009-1026, August.
    7. Hanming Fang & Qing Gong, 2017. "Detecting Potential Overbilling in Medicare Reimbursement via Hours Worked," American Economic Review, American Economic Association, vol. 107(2), pages 562-591, February.
    8. Thuy Nguyen & Victoria Perez, 2020. "Privatizing Plaintiffs: How Medicaid, the False Claims Act, and Decentralized Fraud Detection Affect Public Fraud Enforcement Efforts," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 87(4), pages 1063-1091, December.
    9. Jamie O’Halloran & Anne Sophie Oxholm & Line Bjørnskov Pedersen & Dorte Gyrd‐Hansen, 2024. "Going the extra mile? General practitioners' upcoding of fees for home visits," Health Economics, John Wiley & Sons, Ltd., vol. 33(2), pages 197-203, February.
    10. Li‐Lin Liang, 2015. "Do Diagnosis‐Related Group‐Based Payments Incentivise Hospitals to Adjust Output Mix?," Health Economics, John Wiley & Sons, Ltd., vol. 24(4), pages 454-469, April.
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    12. John R. Bowblis & Christopher S. Brunt, 2014. "Medicare Skilled Nursing Facility Reimbursement And Upcoding," Health Economics, John Wiley & Sons, Ltd., vol. 23(7), pages 821-840, July.

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