Observation Deck

New Signature Requirements Hit Audits

CMS’s unreasonable requests on providers will put the claims process in traction.

• By David Krause
• May 21, 2010

CMS has recently clarified signature requirements you must have in the medical record in order to receive payment for the supplies you have delivered. These new requirements may be so unreasonable, that the industry may have to challenge them in court.

The new requirement states, “Medicare requires a legible identifier for services provided/ordered. The method used shall be hand written or an electronic signature (stamp signatures are not acceptable) to sign an order or other medical documentation for medical review purposes.” Although this seems reasonable on the surface, when you are audited, it is another story.

Armed with the new requirement, CMS has hired 200 new auditors to review claims. The many letters sent have further clarified their intentions. Medical Review is requesting additional documentation consist of:

1. Copy of valid physician order prior to date of service on the claim.
2. Documentation from physician records, prior to the date of service the supports the medical necessity.
3. Documentation from physicians record prior to the date of service that verifies frequency of usage.
4. Proof of request from patient.
5. Itemized proof of delivery.

If the physician signature is not legible on an order or medical record, attach a signature log that includes the typed name of the physician with credentials and the full signature. If the signature is missing on the medial record, attach a signature attestation statement. The attestation statement must be signed and dated by the author of the medical record.

If the signature requirements are not met, the reviewer will conduct the review without considering the documentation with the illegible or missing signature. This could lead the reviewer to determine that medical necessity for the service billed has not been substantiated.

The interpretation of the statute by CMS contractors to include medical records in the signature requirements far exceeds reality in the marketplace. When do physicians sign legibly their entire medical record for each patient? Mandating this documentation is not reasonable when a legible physician order is submitted with unsigned patient records, which substantiate the claim from the medical chart.

Receiving an audit letter for 100 patients and expected to respond within 30 days is also unreasonable. Having access to these patient records requires personal visits to every physician. Many of the patients audited are new patients, with new physicians, which make it very difficult to acquire a patient’s previous medical record. Different physicians of the same group seeing patients confuse the process as each physician has a separate NPI number and CMS does not know they work together.

Physicians are rebelling and are insulted when you explain Medicare finds their signature illegible. Many physicians have refused to comply unless specifically requested by Medicare. There is no incentive for physicians to cooperate, which is fundamentally wrong, as suppliers are liable. Supplies cannot be recovered by the supplier since the patient has used the product during this audit process. Consequently, the patient and Medicare both get free product.

The current rate for Medicare recovery in these audits varies wildly from company to company, but averages 55 percent. With the new signature requirements and 200 fresh new CMS trainees probably looking only at signature legibility, their efficiency for denying claims will skyrocket. CMS won’t have to go to all the trouble of actually reviewing a patient’s condition or trying to understand the supply need.

Suppliers do have the choice to continue the review process, which could extend the claims out over a year. Extending claims to an administrative law judge may be the only way to keep CMS from denying claims improperly. It may become another position in the office where an individual is assigned to follow the “audited claims file” until a judge can determine if Medicare should pay the claim. Of course, if all suppliers rebelled and sent these audited claims denied for medical record signatures through the process, the system may get overloaded. Judges may find that signing every medical record of the patient is unnecessary. A judge may simply want to know if the supplies were utilized by the patient in accordance with the order and legible signature by the physician.

Billing requirements and audit requirements should be the same. If you are billing and providing the product and service in accordance with the rules, why are your claims subject to additional documentation? Providing all the necessary information for billing in 30 days is a reasonable request in an audit. However, adding any documentation requirements to audited claims is unfair, except in suspected fraud. Suppliers should not be expected to have to drop everything for the next 30 days to gather past medical records of their patients, many of which do not exist, as they now require. Asking your physicians to resign records because their signature was deemed illegible by a freshman CMS employee is unreasonable and may be more to fear than the audit itself.

This article originally appeared in the July 2010 issue of HME Business.