hold is lifted). ZPics will not remove a physician or provider from prepayment review until the contractor is convinced that the provider fully understands and employs the proper rules governing documentation, coverage, and payment. from a billing company’s standpoint, the placement of a physician or other provider on prepayment review may place the company in financial jeopardy. absent the ability to terminate a billing agreement, a third-party billing company will technically be required to continue to process claims for a provider despite the fact that the provider’s cash flow has been greatly reduced. the likelihood of this risk has significantly increased now that racs are also conducting prepayment reviews. frankly, this is not in anyone’s interests and will only result in discord between the parties. once again, the need for physician compliance is highlighted by this risk. • consider Provider “revocation” actions: from an administrative standpoint, the revocation of a provider’s medicare number is the second worst administrative sanction that can be taken, only exceeded by being “excluded” from participation in the medicare program altogether. if a provider’s medicare number is revoked, the action is likely to be retroactive for a period of a few weeks to several months. unfortunately, many providers currently have very little diversity when it comes to payor mix. a revocation action may knock out between 60% and 95% of a provider’s current patients from receiving reimbursable care in the future. there are at least two lessons to be learned here. first, third-party billing companies really need to keep any receivables at a minimum. Providers placed on suspension will likely have a difficult time financially until they can rebuild their practice. second, if a suspension action is made retroactively, a physician may want to be repaid for monies he has to pay back. depending on the contract between the parties, the monies previously paid to a third-party billing company may no longer qualify as “collected.” there is a delicate balance to the business relationship between third-party billing companies and the health care providers who they serve. unfortunately, this balance can be seriously disrupted if one of the parties fails to abide by the spirit of the agreement, even if the terms of their obligations are technically being met. that is precisely what occurs if a health care provider is unexpectedly placed on prepayment review, has their medicare number suspended, or is terminated from the medicare program. in light of these challenges, we recommend that third-party billing companies carefully review their claims processing contracts to ensure that they will not be required to continue providing billing services to a health care provider even though the provider’s cash flow has effectively been frozen by the government. Robert W. Liles, Esq. is managing partner at Liles Parker, a health law firm with offices in Washington, DC; Baton Rouge, LA; Houston, TX; and McAllen, TX. He can be contacted at: (202) 298-8750. His email address is rliles@lilesparker.com. Resources 1 from the prepared statement of leslie g. aronovitz, associate director, health financing and Public health issues, health, education, and human services division, general accounting office (gao). house hearing, 106 congress, “Third-Party Billing Company Fraud: Assessing the Threat Posed to Medicare,” hearing before the subcommittee on oversight and investigations of the committee on commerce, house of representatives, one hundred sixth congress, second session, april 6, 2000. serial no. 106-97. 2 testimony of barry reiter of the healthcare billing and management association before the national committee on vi tal and heal th stat i s t i c s januar y, 24, 2007. http://www.ncvhs.hhs.gov/070125p6.htm 3 fed. reg. vol. 63, no. 243 (december 18, 1998). https://oig.hhs.gov/fraud/docs/complianceguidance/thirdparty. pdf 4 ibid, page 70143. footnote 40. 5While the government remains concerned about percentagebased arrangements, it is interesting to keep in mind that recovery audit contractors (racs) are compensated on a percentage-based arrangement when identifying medicare and medicaid overpayments made to health care providers. 6 ama code of medical ethics, rule 6.02. http://www.amaassn. org//ama/pub/physician-resources/medical-ethics/codemedical ethics/opinion602.page 7 31 usc § 3729(a)(1)(a) and (a)(1)(g). http://www.law.cornell.edu/uscode/text/31/3729 the journal of the healthcare billing and management association 21
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