File Documentation: Key to OIG Compliance

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By Sheila Press, Attorney, MBA

The subject of this article is file documentation and compliance with the OIG (Office of the Inspector General) Compliance Guidance for the Durable Medical Equipment, Prosthetics, Orthotics, and Supply Industry.

First published in June 1999, this document provides both general and specific guidance as to various internal antifraud and abuse controls that suppliers can implement on a voluntary basis. Moreover, it identifies and discusses numerous compliance risk areas that, according to the OIG, are particularly susceptible to fraud and abuse by durable medical equipment, prosthetics, orthotics and medical supply (DMEPOS) suppliers.

At the time of publication, then-Inspector June Gibbs Brown stated, "The purpose of the guidance is to help suppliers self-regulate, self-report, and prevent healthcare fraud. The voluntary adoption and implementation of the guidance will serve to promote ethical and lawful conduct and further the fundamental mission of all suppliers, which is to provide quality items, service, and care to patients."

Thus, the major difference between complying with HIPAA and complying with the OIG's Guidelines is that the former is a law requiring compliance, while the latter are voluntary guidelines. Nevertheless, the penalties for failure to follow the Guidelines can be severe: there are civil and criminal penalties for fraud and abuse. Furthermore, if file documentation is found to be incomplete during an audit, the government can require repayment of money paid on the audited claims as well as prepayment reviews and expanded audits.

In examining whether file documentation is complete, the maxim to remember is: If it's not documented, it did not happen. Here are suggested guidelines:

1. Patient Information: You should maintain an accurate record of your patient's name, address, telephone number, employer, and insurance information. It is advisable to make copies of the patient's insurance cards as well as to verify coverage and which insurance is primary/secondary.

2. Prescription: This document should, at a minimum, contain the patient's name, date signed, an appropriate signature, and a generic description of the service/device ordered. Check your Medicare Supplier Manual for additional detailed requirements for prescriptions. Also, in certain cases, a purchase order or written authorization from a payer may suffice.

3. Clinician's Notes: There should be a dated, signed, informative, legible note for each patient encounter. Some other hints: When a new device is ordered, the clinician should evaluate the patient and indicate the treatment plan. Where appropriate, note the specific componentry to be used. For a lower-limb prosthetic patient, indicate the patient's current and expected functional level and how it was determined.

For certain Medicare benefits such as replacement sockets and custom lower-limb orthotics, you must document certain medical criteria. If billing for repairs, adjustments, and/or time, the materials used and the time spent should be noted in the file. At the time of delivery, note how well the device fit and functioned as well as whether the patient received wearing instructions and/or educational materials and any follow up to be performed. The SOAP format may be helpful. The SOAP format is:

Subjective: what does the patient say;
Objective: what do you observe;
Assessment: what is the problem or issue with this patient at this visit; and
Plan: what is your treatment plan to address this  problem or issue.

4. Release of Information: This form gives you the patient's permission to use his/her treatment information for billing purposes. See box 12 of the CMS 1500 Form. After April 14, 2003, the HIPAA Consent Form can replace the release form.

5. Assignment of Benefits: This form serves as the patient's permission to his/her insurance carrier to pay the provider rather than the patient. It is fraudulent to check box 12 of the CMS 1500 form if you do not have a signed assignment form in your file.

6. Delivery Acknowledgment: Your file should contain the patient's signed, dated form acknowledging receipt of the device/service and noting specifically what the patient received.

Complete and accurate file documentation is a continuing challenge. You and your staff need to be attentive to details in coverage criteria and to be knowledgeable about applicable Medicare Medical Policy and file documentation requirements. It is important to meet the challenge of complete and accurate file documentation challenge head-on in order to safeguard your revenue.

Often, the OIG's Guidelines are given "lip service" by O&P professionals, but compliance itself is rather haphazard. Many practitioners believe that they are in compliance when they are not. Often, "People don't know what they don't know." A fully implemented, ongoing compliance program, which meets the seven required elements of the OIG's Guidelines and which includes policies, procedures, training, and internal auditing, is the best tool to achieve compliance and to protect both the professional and financial aspects of your business.

Sheila M. Press, Attorney, MBA, can be contacted at 480.767.9477; e-mail:;