Department of Health and Human Services
 
OFFICE OF 

   
INSPECTOR GENERAL 

 
 
 
 
 
 
 
 
MEDI CARE PAYMENTS FOR 

 
F J I
ACET  OINT  NJECTION 

 
 
S  
ERVICES 

 
 
 
 
 
 
Daniel R. Levinson 
  
Inspector General 

 
September 2008 
 
OEI-05-07-00200 
    
 
 
Office of Inspector General

http://oig.hhs.gov  
 
The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as  
amended, is  to protect the integrity of the Department of  Health and Human Services  
(HHS)  programs, as well as the health and welfare of beneficiaries  served by those 
programs.  This statutory mission  is  carried  out through  a nationwide network  of  audits, 
investigations, and inspections conducted by the  following operating components:  
Office of Audit Services 
The Office  of  Audit Services  (OAS) provides auditing services  for HHS, either by  conducting  
audits  with its own audit resources or by  overseeing  audit work done by others.  Audits  
examine the performance of HHS programs and/or its grantees and contractors in carrying  
out their respective responsibilities and are intended  to provide independent assessments of 
HHS programs and operations.  These assessments help reduce waste, abuse, and  
mismanagement and promote economy and efficiency  throughout  HHS. 
Office of Evaluation and Inspections  
The Office  of  Evaluation and Inspections (OEI)  conducts national evaluations to  provide 
HHS, Congress, and the public with timely, useful, and reliable information on significant 
issues.  These evaluations focus on preventing fraud,  waste, or abuse  and promoting  
economy, efficiency, and effectiveness of departmental programs.  To promote impact, OEI 
reports also present practical recommendations for improving  program operations.  
Office of Investigations 
The Office of Investigations (OI) conducts criminal, civil, and administrative investigations  
of  fraud and misconduct  related to HHS programs, operations, and beneficiaries.  With 
investigators working in all 50 States and the District of Columbia, OI  utilizes its resources 
by actively  coordinating with the Department  of Justice  and other Federal, State, and local 
law enforcement authorities.  The investigative efforts of OI often lead to  criminal 
convictions, administrative sanctions,  and/or  civil monetary  penalties.  
Office of Counsel to the Inspector General 
The Office of Counsel to the  Inspector  General (OCIG) provides general legal services to 
OIG, rendering  advice and opinions on HHS programs and operations and  providing all  
legal support for OIGs  internal operations.  OCIG represents  OIG in all civil and 
administrative fraud and abuse cases involving HHS programs,  including False Claims Act, 
program exclusion, and civil monetary penalty cases.  In  connection with these cases, OCIG 
also negotiates and monitors corporate integrity agreements.  OCIG renders advisory 
opinions, issues compliance program  guidance, publishes fraud alerts, and provides other  
guidance  to  the health care industry concerning the anti-kickback statute and other  OIG  
enforcement authorities.    
   
  E X E C U T I V E   S U M M A R Y
OBJECTIVES 
 
1. 	  To determine the extent to which Medicare Part B payments for 
facet joint injections meet Medicare program requirements. 
2. 	  To determine what policies and safeguards exist to ensure that 
Medicare Part B payments for facet joint injections meet Medicare 
program requirements. 
BACKGROUND 
Medicare Part B payments for facet joint injections have increased from 
$141 million in 2003 to $307 million in 2006. Over the same period, the 
number of Medicare claims for facet joint injections increased by          
76 percent.  
Facet joints are joints in the spine that aid stability and allow the spine 
to bend and twist.  Facet joint injections are a type of interventional 
pain management technique used to diagnose or treat back pain.  Two 
primary codes, 64470 and 64475, are used to bill a single injection in the 
cervical/thoracic or lumbar/sacral areas of the spine, respectively. Each 
primary code has an associated add-on code for use when injections are 
provided at multiple spinal levels.  Unilateral injections are performed 
on one side of the joint level, while bilateral injections are performed on 
the right and left side of the joint level.  The Centers for Medicare &  
Medicaid Services (CMS) requires  physicians to indicate a bilateral 
injection by using billing modifier 50.  Physicians typically perform facet 
joint injections using radiological guidance to ensure correct needle 
placement and avoid nerve or other injury.  Medicare Part B carriers  
are responsible for implementing program safeguards for these services. 
We conducted a medical record review of a stratified random sample of 
646 facet joint injection services performed in 2006.  In addition, we 
interviewed staff from the 15 carriers that processed Medicare Part B 
claims in 2006 and reviewed their program safeguards for facet joint 
injections. 
FINDINGS 
Sixty-three percent of  facet joint injection services allowed by  
Medicare in 2006 did not meet Medicare program requirements, 
resulting in approximately $96 million in improper payments.   
Medicare allowed an additional $33 million in improper payments for 
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associated facility claims. Thirty-eight percent of facet joint injection 
services had a documentation error and 31 percent had a coding error.  
For services that had a coding error,  just over 60 percent were overpaid  
because physicians incorrectly billed additional add-on codes to 
represent bilateral facet joint injections instead  of using modifier 50.  
Eight percent of services had a medical necessity error.  Fourteen  
percent of services had one or more  overlapping errors.   
Facet joint injection services provided in an office were more likely to 
have an error than those provided in  an ambulatory surgical center or 
hospital outpatient department.  
In 2006, most carriers  had policies and safeguards for facet joint 
injection services but they identified limits to using these  
safeguards.  Local coverage determinations (LCD) and claims  
processing edits are carriers primary tools to protect Medicare 
payments for facet joint injections.  Thirteen of fifteen carriers had  
LCDs for facet joint injections.  Of carriers with LCDs, 10 had at least   
one active edit.   
Carrier staff identified two complexities in creating frequency limits for  
facet joint injections.  First, the lack of consensus in the medical 
community about appropriate frequency of injections is a barrier to 
creating frequency limits in LCDs.  Second, frequency edits for facet  
joint injections are difficult to automate because many require 
information that is not currently available on Medicare claims. 
RECOMMENDATIONS 
Based on the results of  our review, CMS should: 
Strengthen  program safeguards to prevent improper payment for 
facet joint injection services.  CMS should assist carriers in developing  
ways to scrutinize physician claims for facet joint injection services 
provided in an office setting.   CMS should also encourage carriers that 
require radiographic imaging guidance in their LCDs to implement 
automated edits for imaging guidance.  Finally, CMS should direct 
carriers to revisit frequency limits in their LCDs and update them so  
that they are as effective as possible. 
Clarify billing instructions for bilateral services.  CMS should clarify 
billing instructions for bilateral services and recover funds if 
appropriate.  Correct use of add-on codes and modifier 50 could result in 
cost savings.   
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Take appropriate action regarding the undocumented, medically  
unnecessary, and miscoded services identified in our sample.  We 
have forwarded information on these services to CMS. 
AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL  
RESPONSE 
CMS described steps that it will take to address our recommendation to 
strengthen  program safeguards for facet joint injection services. CMS 
agreed with our recommendations to clarify billing instructions for 
bilateral services and to take appropriate action on services paid in 
error in our sample.  
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  T A B L E   O F   C O N T E N T S  
EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i
  
 
 
I N T RO DUC T IO N  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  1 
  
 
 
F I N D IN G S  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  11 
  
  Sixty-three percent of services did not meet requirements. . . . . .  11 
  
  Carriers had safeguards but identified limits to using them  . . . .  15 
  
 
 
R E C O MMEN D A T ION S  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  19 

          Agency Comments and Office of Inspector General Response . . .  20 

 
 
APPENDIXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  22 
  
  A:  Detailed Methodology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  22 
  
  B:  Confidence Intervals for Selected Estimates . . . . . . . . . . . . . .  25 
  
  C:  Specialty Error Rate in an Office Setting for Sample  . . . . . . .  27 
  
  D:  Agency Comments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  28 
  
 
 
A C K NO WL E D G M E N T S  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  31 
    
   
  I N T R O D U C T I O N
OBJECTIVES 
1. 	  To determine the extent to which Medicare Part B payments for 
facet joint injections meet Medicare program requirements. 
2. 	  To determine what policies and safeguards exist to ensure that 
Medicare Part B payments for facet joint injections meet Medicare 
program requirements. 
BACKGROUND 
According to one source, chronic pain affects more adults in the United 
States than diabetes, heart disease, and  cancer combined.1  Treatment  
varies depending on the type of pain and can range from noninvasive to  
invasive procedures. Medicare paid over $2 billion in 2006 for 
interventional pain management procedures.2  Examples of 
interventional pain management procedures include:  injections, nerve 
blocks, and spinal cord stimulation. 
From 2003 to 2006, the number of Medicare claims for facet joint 
injections, an interventional pain management procedure, increased by 
76 percent.3   Overall, payments for facet joint injections increased from 
$141 million in 2003 to $307 million in 2006.4  These payments  
represent both physician and facility payments.  They account for 
approximately 15 percent of Medicare payments for interventional pain 
management services in 2006. 
In addition to an increase in Medicare payments, a number of recent 
investigations by the Federal Bureau of Investigations (FBI) and the 
Office of Inspector General (OIG) have found inappropriate activity 
related to facet joint injections and other types of pain management. In 
one joint FBI-OIG case, an Ohio physician was convicted of multiple 
 
1 American Pain Foundation.  Pain Facts & Figures.  (2007).   Available online at   
http://www.painfoundation.org/page.asp?file=Newsroom/PainFacts.htm. Accessed on 
May 3, 2007. 
2  Estimate based on OIG analysis of interventional pain management procedure codes in  
the 2006 100-percent National Claims History (NCH) outpatient and physician/supplier 
files. 
3  Estimate based on OIG analysis of facet joint injection procedure codes in the following  
Medicare claims files:  (1) 2003 1-percent sample of NCH outpatient and physician/supplier 
files, and (2) 2006 100-percent NCH outpatient and physician/supplier files.   
4 Ibid. 
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counts of health care fraud for interventional pain management 
procedures, including facet joint injections.5   
Facet Joint Injections 
Facet joints are joints in the spine that aid stability and allow the spine 
to bend and twist.  Facet joints are located between each vertebra in the 
spinal column.  See Figure 1 for an illustration of cervical facet joints.  
There are 25 levels of facet joints in the spine that are divided, from top  
to bottom, into cervical, thoracic, lumbar, and sacral regions.6 Each 
level has a pair of facet joints, one facet joint on the right and one on the  
left side of the spine.    
 
  Figure 1. Cervical Facet Joints 
 
Source: The Pain Clinic.  Available online at 
www.painclinic.org. Accessed on October 9, 2007. 
 
Facet joint injections are a type of interventional technique used to 
diagnose or  treat back pain.  For some people with chronic pain due to a 
facet joint injury, injections of an anesthetic or steroid into a facet joint  
 
5 U.S. Department of Justice, U.S. Attorneys Office, Northern District of Ohio  
(June 9, 2006).  Press release.  Available online at  
http://www.usdoj.gov/usao/ohn/news/09June2006_2.html. Accessed on March 18, 2008.  
6 The Pain Clinic.  Facet Joint Injections.  (n.d.)  Available online at   
http://www.painclinic.org/treatment-facetjointinjections.htm. Accessed on March 19, 2008.   
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help reduce inflammation and relieve pain.  Figure 1 shows a unilateral, 
single-level injection into the C5-C6 facet joint level. Unilateral 
injections are performed  on one side  of the joint level, while bilateral 
injections are performed  on the right and  left side of the joint level.     
Frequency of injections.  The frequency of facet joint injections varies for 
diagnostic and therapeutic injections.  For a diagnostic injection, a 
physician injects a numbing medicine and/or a steroid into  one or two 
suspect facet joints.7  The amount of  immediate relief experienced by a 
patient will help confirm or reject the joint as the source of pain.  For a 
therapeutic injection,  a physician injects a numbing medicine and/or a 
steroid into  one or more  facet joints to reduce inflammation.8   Typically, 
a physician performs a diagnostic injection once,  whereas therapeutic 
injections might be performed repeatedly for ongoing pain relief.   
Radiographic guidance.   Facet joint injections are typically performed 
using radiological guidance (radiographic guidance or live x-ray) to 
ensure correct needle placement and  avoid nerve  or other injury.  
Sometimes,  a physician performs the procedure without radiological 
imaging, which is referred to as a blind injection. One study of these 
blind injections concluded that facet joint injections should not be 
performed without the aid of radiological imaging because of potential 
risk to the patient and lack of diagnostic accuracy.9    
Setting and specialty. Facet joint injections may be performed in a 
variety of settings. In 2006, approximately 60 percent of facet joint 
injections were performed in an office setting, 20 percent in an 
ambulatory surgical center (ASC), and 20 percent in a hospital 
outpatient setting.10  In 2006, over 220,000 Medicare beneficiaries 
received a facet joint injection in one of these three settings.11    
Different physician specialties perform facet joint injections.  In 2006, 
anesthesiologists, pain management specialists, and physiatrists 
 
7 M. Boswell, et al. (2007).  A Systematic Review of Therapeutic Facet Joint 
Interventions in Chronic Spinal Pain.  Pain Physician, 10, pp. 229253. 
8 Ibid. 
9 G. Purcell-Jones, et al.  (1989). Paravertebral Somatic Nerve Block:  A Clinical, 
Radiographic, and Computed Tomographic Study in Chronic Pain Patients.  Anesthesia &  
Analgesia, 68(1), 32-9. 
10 Estimate based on OIG analysis of facet joint injection procedure codes in the 2006 
NCH Medicare Part B physician/supplier file for amounts greater than $15 for ASC, office, 
and hospital outpatient department. 
11 Ibid. 
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performed approximately 64 percent of Medicare facet joint injections, 
while general practitioners, internal medicine physicians, and family 
practice physicians performed 19 percent.  Other types of physicians 
performed the remaining 16 percent, including orthopedic surgeons,  
neurologists, and rheumatologists.12  
Medicare Program Requirements for Facet Joint Injections 
General provisions of the Social Security Act (the Act) govern Medicare 
reimbursement for all services, including facet joint injections.  Section 
1862(a)(1)(A) of the Act states that Medicare will cover only services 
considered to be reasonable and necessary.13 Reasonable and necessary 
items are those used in the diagnosis or treatment of illness or to 
improve the functioning of a malformed body part.  Further, section 
1833(e) of the Act states that payment is made only when a provider has 
furnished appropriate information  about the service for the processing 
of the claim.14  
Medicare requires that providers report services using uniform  
procedure codes.15  The Current Procedural Terminology (CPT) codes 
and descriptions for facet joint injections are listed in Table 1.  Two 
primary codes, 64470 and 64475, are used for a single injection in the 
cervical/thoracic or lumbar/sacral areas of the spine, respectively. Each 
primary code has an associated add-on code for use when more than one 
injection is provided in an area.  The add-on codes are 64472  
(cervical/thoracic) and 64476 (lumbar/sacral).   
Table 1: Facet Joint Injection CPT Codes and Descriptions 
CPT Code  Description 
64470  Injection; Paravertebral facet joint or facet joint nerve; cervical/thoracic, single level 
64472 (add-on)   Injection; Paravertebral facet joint or facet joint nerve; cervical/thoracic, each additional level 
64475  Injection; Paravertebral facet joint or facet joint nerve; lumbar/sacral, single level 
64476 (add-on)   Injection; Paravertebral facet joint or facet joint nerve; lumbar/sacral, each additional level 
Source: American Medical Association CPT descriptions, 2006. 
 
 
12 OIG analysis of 2006 NCH Medicare Part B facet joint injection claims.  Total does not 
sum to 100 percent because of rounding. 
13 Social Security Act  1862(a)(1)(A), 42 U.S.C.  1395y.  
14 Social Security Act  1833(e), 42 U.S.C.  13951.  
15 Section 1848(c)(5) of the Act required the Secretary of the Department of Health and 
Human Services to develop a uniform coding system for all physician services.  The 
American Medical Associations CPT is a numeric coding system for physicians services. 
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The National Correct Coding Initiative Policy Manual for Medicare 
Services (NCCI manual) outlines national correct coding guidelines for  
CPT codes.16   The NCCI manual states that providers should  use the  
CPT codes that most comprehensively describe the services performed.  
The only specific references to facet joint injection codes in the NCCI 
manual relate to management of acute postoperative care.  No guidance  
exists for facet joint injection codes outside of postoperative care. 
The NCCI manual and the Medicare Claims Processing Manual 
require that physicians use modifiers to indicate when a service differs 
from the CPT definition. Modifiers are two-digit codes billed in 
conjunction with the CPT code.  Up to two modifiers are allowed for 
each CPT code on a claim.     
Medicare Part B Payments for Facet Joint Injections 
Medicare reimburses physicians and facilities for facet joint injections 
according to the Medicare Physician Fee Schedule and Medicare Facility 
Payment Rates, respectively.17   
Physician payments.  The Medicare Physician Fee Schedule includes two 
types of fees, based on setting:  those paid to physicians for services 
rendered in nonfacilities, such as their offices; and those paid to 
physicians for services rendered in facilities, such as ASCs and hospital 
outpatient departments. Physician fee schedule  payments for office  
services are generally higher than physician fee schedule payments for 
facility services because they include payment for practice expenses 
such as building costs, salaries, and equipment.  Fee schedule amounts 
are adjusted to account for geographic location.  The base physician fee 
schedule rates for facet joint injections in 2006 are listed in Table 2.   
Table 2: Medicare Physician Fee Schedule Base 
Rates, 2006 
CPT Code  Office  Facility  
64470  $349.04  $101.19  
64472 (add-on)   $140.60  $64.80 
64475  $318.72  $81.10  
64476 (add-on)   $120.51  $48.89 
Source: Medicare Physician Fee Schedule, 2006.  
 
 
16 Centers for Medicare & Medicaid Services (CMS) NCCI Policy Manual for Part B 
Medicare Carriers, Version 12.3, Introduction, pages viii9 (October 1, 2006). 
17 Section 1848(a)(1) of the Act established the physician fee schedule as the basis for 
Medicare reimbursement for all physician services beginning in January 1992.  
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Reimbursements for primary codes 64470 and 64475 are higher because 
they include presurgical and postsurgical expenses related to the  
procedure that the add-on codes, 64472 and 64476, do not. 
Physician payments also vary based on modifiers billed with the CPT.   
For example, bilateral facet joint injections, which are performed on 
both the right and left side of a level, should be billed using  
modifier 50, which increases reimbursement to 150 percent of the base 
rate.18  If a physician performs multiple bilateral injections, modifier           
50 should accompany each facet joint injection CPT code.     
Facility payments.  Medicare reimburses ASCs and hospital outpatient 
departments for their expenses separately from the payments made to 
physicians for rendering services in these settings.  Medicare facility 
payment rates for ASCs and hospital outpatient departments are based 
on ASC payment groups and the outpatient prospective payment 
system, respectively.  Facility payment rates are adjusted to account for 
geographic location.  The base facility payment rates for facet joint 
injections in 2006 are listed in Table 3. 
Table 3:  Medicare Facility  Base Payment Rates, 
 
2006 
CPT Code  ASC   Hospital Outpatient  
64470  $333  $357.90 
64472 (add-on)   $333  $321.42 
64475  $333  $357.90  
64476 (add-on)   $333  $321.42 
Source: Ambulatory Surgical Center Approved Healthcare 
Common Procedural Coding System (HCPCS) Codes and Payment  
Rates, 2006, and Hospital Outpatient Prospective Payment Rates, 
2006.  
   
Claims Processing and Program Safeguards 
CMS contracts with private organizations, called carriers, to  process  
and pay Medicare Part B claims.  In 2006, CMS contracted with                   
15 carriers to process Medicare Part B claims in the 50 States, the 
District of Columbia, and U.S. territories.   
Carriers are also responsible for implementing program safeguards to 
reduce payment errors.  To accomplish this, carriers create local 
coverage determinations (LCD), issue instructional articles, and 
 
18 CMS Medicare Claims Processing Manual, Pub. No. 100-04, ch. 12,  40.7. 
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implement claims processing edits.  Carriers also analyze data, conduct  
provider education, and conduct medical reviews.   
Local coverage determinations. Because no National Coverage 
Determination19 exists for facet joint injections, carriers may develop 
their own local coverage guidelines called LCDs.  The LCDs describe 
whether services are reasonable and necessary and therefore covered by 
Medicare.  They also provide additional guidance to physicians about 
specific services. 
The LCDs vary by carrier and may result in different coverage in 
different parts of the country.  They generally cover the following topics:  
   indications and limitations of coverage and medical necessity, 
   covered diagnosis codes supporting medical necessity,                                 
   documentation requirements, and                                                          
   utilization guidelines. 
Claims processing edits.  Carriers may implement automated electronic  
edits to prevent improper payments.20  These edits are coded system 
logic that automatically pay all or part of a claim, deny all or part of a 
claim, or suspend all or part of the claim for manual review.  Carriers 
must have an LCD to implement their own local edits.   
CMS requires carriers to evaluate local prepayment edits annually for 
effectiveness.  CMS considers an edit effective  when it has a reasonable  
rate of denial relative to  suspensions, a reasonable dollar return on the  
cost of operation, or potential to avoid significant risk to beneficiaries. 
Carriers also implement CMS-wide edits where appropriate.  In 2007, 
CMS implemented Medically Unlikely Edits (MUE).  CMS created 
MUEs to reduce the Medicare fee-for-service paid claims error rate.21   
Carriers deny the entire service when the billed units of service exceed 
MUE criteria.22  CMS bases the MUE criteria on data for past periods, 
clinical judgment of CMS health care professionals, and comments from  
 
19 National Coverage Determinations, issued by CMS, govern how  Medicare will cover 
specific services, procedures, or technologies at a national level. 
20 CMS Medicare Program Integrity Manual, Pub. No. 100-08, ch. 3,  3.5. 
21 CMS Medicare Claims Processing Manual, Pub. 100-04, Quarterly Update to 
Medically Unlikely Edits, Version 2.1, transmittal 1265. 
22 Ibid. 
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the health care community.23  Currently, CMS has an active MUE for 
facet joint injection services establishing an upper limit for the number 
of services a physician can bill.24  
METHODOLOGY 
To determine the extent to which facet joint injection services meet 
Medicare requirements, we:  (1) conducted a medical record and coding 
review of a stratified random sample of allowed physician claims for 
Medicare Part B facet joint injection services in 2006, (2) reviewed CMS 
and carrier policies, and (3) conducted structured telephone interviews 
with carrier staff.   
Sample Selection 
The population from which we sampled consisted of all allowed 
physician services in the CMS NCH file for CPT codes 64470, 64472, 
64475, and 64476 performed in 2006.  We excluded services with 
allowed amounts less than $15 to avoid performing a medical record 
review on low dollar claims.25  The population consisted of  
approximately 1 million services and $203 million in allowed physician 
payments. From this population, we selected a random sample of               
660 physician line item claims26 stratified by place of service and            
Medicare-allowed amount.  See Appendix A for further detail on the 
sample selection, data collection, and data analysis.  
Data Collection 
After excluding 6 services from the 660 in our sample because of 
ongoing investigations by OIG, we requested, by mail, complete medical 
records from physicians for 654 sampled services.  We classified 
providers for eight services as nonresponders.27  Thus, we based our  
review on the remaining 646 line items.  This represents a 99-percent 
response rate.     
 
23 CMS MUE Project.  Available online at 
http://www.cms.hhs.gov/MedicalReviewProcess/Downloads/MUECHARTER.pdf. Accessed 
on February 20, 2008. 
24 To protect MUE effectiveness, CMS prohibits specific MUE limits from being  
published. 
25 These services represent less than 1 percent of the population. 
26 Multiple line items may be billed on a single claim.  Hereinafter, line items will be 
referred to as services. 
27 A nonresponder is defined as a provider with whom no successful contact has been  
made after at least three written contacts and two phone calls.  
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We also reviewed 15 carrier LCDs for facet joint injections.  We then 
conducted 15 structured telephone interviews with carrier staff 
regarding policies and safeguards for facet joint injection services. We 
conducted one interview per carrier  with the carrier medical director 
and support staff.  We conducted these interviews between  October and  
December 2007.  
Medical record review. We used a contractor to conduct the medical 
record review.  The reviewers included five board-certified physicians 
with pain management and facet joint injection experience and one 
certified professional coder.  One physician and the coder reviewed each  
of the medical records.  The physician determined whether the service 
was adequately documented and medically necessary, while the coder 
determined  the appropriate CPT code and modifier(s) for the service. 
Data Analysis 
We analyzed the results from the medical record review to  determine 
the percentage of physician services that did not meet Medicare 
program requirements.   We also calculated the projected physician 
dollars paid  in error for these services.  We then compared physician 
office error rates to facility (ASC and hospital outpatient) error rates.   
For our facility error rate, we combined ASC and hospital outpatient 
services, hereinafter referred to as facility.  We did not compare ASC 
and hospital outpatient separately due to small sample sizes.  Finally, 
when possible, we used the NCH files containing ASC and hospital 
outpatient department facility payments to match to the associated 
physician service. We projected the identified facility dollars paid in 
error. 
We analyzed all carrier interviews and classified their responses. In 
particular, we counted the number and type  of edits each carrier had  in 
place in 2006. We also noted common themes in the interviews. Finally, 
we reviewed all carrier LCDs for facet joint injections and assessed their 
similarities and differences.  
Comprehensive Error Rate Testing 
CMS established the Comprehensive Error Rate Testing (CERT) to  
calculate the Medicare fee-for-service paid claims error rate. As of 2007, 
the CERT has not reported any specific information about facet joint 
injection services.  This review was not designed to reproduce or to  review 
CERT findings. 
 
 
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Limitations 
Because we  did not stratify our sample by carrier, we were not able to 
calculate medical review error rates by carrier.  Therefore, we were  
unable to assess whether carrier program safeguards had an impact on 
error rates. 
Standards 
Our review was conducted in accordance with the Quality Standards 
for Inspections issued by the Presidents Council on Integrity and 
Efficiency and the Executive Council on Integrity and Efficiency.  
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   10   
   
  F I N D I N G S  
 
Sixty-three percent of facet joint injection services  Medicare allowed approximately 
allowed by Medicare in 2006 did not meet  $96 million in improper payments 
to physicians for facet joint 
Medicare program requirements, resulting in 
injection services in 2006.  These 
approximately $96 million in improper payments 
improper payments represent       
47 percent of the $203 million physician payments for facet joint 
injections in 2006. 
Medicare allowed an additional $33 million in improper payments for 
associated facility claims. While the focus of this review is on physician 
claims, we also calculated facility claims that were submitted for the 
physician claims paid in error to provide additional context. The 
remaining analysis focuses on physician claims only.      
Sixty-three percent of facet joint injection services did not meet 
Medicare requirements.  Table 4 provides a breakdown of error rates 
and associated payments for physician claims by error type.  Confidence 
intervals for projected error rates and payments are in Appendix B. 
 
Table 4:  Improperly Paid Medicare Facet Joint Injection Services   
 
Physician Claims, 2006  
 
  Sample  Projected  
  Allowed  Allowed 
Type of Error  Services  Services 
Amount  Amount 
  Documentation   196  $35, 835  38%  $81 million 
Coding  173  $11,670  31%  $21 million 
 
Medical Necessity   43  $7,394  8%  $17 million 
 
(Overlapping Errors)  (71)  ($12,247)  (14%)  ($23 million) 
  Total  341  $42,651*  63%   $96 million 
Source:  OIG  analysis of  medical  review  results, 2008.                                                                                       
 
* Numbers do not sum to total because of rounding. 
  
Thirty-eight percent of facet joint injection services had a documentation 
error 
Medicare allowed approximately $81 million for physician services that 
were either undocumented or insufficiently documented.  Although 
some cases of missing documentation  may be due to errors, others may 
represent services not rendered.  Claims for services that lack sufficient 
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   11    
   
F I N D I N G S  
documentation to show that care was provided do not meet Medicare 
program requirements.28    
Twenty-seven percent of facet joint injection services were undocumented.   
Medicare allowed approximately $59 million for undocumented facet 
joint injection services.   For the majority of these services, physicians 
submitted no medical records for the sampled services.  For the 
remaining services, a record was submitted but contained no  
documentation of the sampled services.   
Eleven percent of facet joint injection services were insufficiently 
documented.  Medicare allowed approximately $22 million for 
insufficiently documented facet joint injections.  The majority  of records 
for these services were  missing a description of the procedure that was 
billed. Others had a procedure note, but were missing details of the 
procedure, such as which levels and sides of the  back were injected.  In 
each case, the physician reviewer concluded there was insufficient 
documentation to support the service.  
Thirty-one percent of facet joint injection services had a coding error 
Medicare allowed approximately $21 million in overpayments, net of 
underpayments, to physicians for facet injection  services that physicians 
billed with codes that did not accurately reflect the service described in 
the medical record.  Approximately 79 percent of miscoded services 
affected payment; 82 percent were  overpayments and 18 percent were 
underpayments.  See Appendix B for the dollars associated with 
overpayments and underpayments.     
Just over 60 percent of the overpaid services were instances in which the 
physician billed incorrectly for bilateral facet joint injections.  Of the 
miscoded services that were overpaid, 61 percent were instances in 
which the physician incorrectly billed CPT add-on codes to represent  
bilateral facet joint injections instead of using modifier 50.  Specifically, 
they billed multiple lines of CPT add-on codes 64472 or 64476 in 
addition to a primary code.  Physicians should use add-on codes to 
represent additional levels of the back injected, not sides.  As  previously 
noted, the NCCI manual and Medicare Claims Processing Manual 
require that physicians use modifiers to indicate when they are billing 
for bilateral facet joint injection services.  For example, a physician 
billing two add-on codes to represent a bilateral service receives  
 
28 Social Security Act  1833(e); 42 U.S.C.  13951(e). 
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   12   
   
F I N D I N G S  
200 percent of the base payment when he or she should receive  
150 percent of the base payment.  Billing add-on codes to represent 
bilateral injections results in a 50-percent higher net payment than 
Medicare should have allowed.      
Physicians may have accidentally billed some of  these miscoded services 
because of confusion about appropriate coding rules.  Other miscoded  
services may have been intentionally exploited for higher payment.   
Additional investigation would be needed to distinguish accidental 
errors from potentially fraudulent activity.   
All of the underpayments in our sample were for bilateral facet joint 
injections for which the provider only billed for unilateral services.  All         
29 of the underpaid services in our  sample were bilateral facet joint 
injections for which the provider billed only for unilateral services, 
resulting in a 50-percent underpayment.29    
Eight percent of facet joint injection services had a medical necessity error 
Medicare allowed approximately $17 million to physicians for facet joint 
injection services that medical reviewers determined were medically 
unnecessary.  In many instances, reviewers indicated that the record 
did not contain any patient history or physical exam to show that the 
treatment was medically indicated for the patient.  In other instances, 
reviewers noted that the record was missing imaging studies to support 
the diagnosis and justify facet joint injections as the treatment.   
Facet joint injection services provided in an office were more likely to have  
an error than those provided in a facility  
Seventy-one percent of facet joint injection services provided  in an office  
had some type of error, compared to  51 percent of facet joint injection 
services provided in a facility. See Table 5 on the following page for 
error rates by setting and error type. 
 
 
 
 
 
 
29 Statement is based only on the sample and not on a projection to the population. 
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   13   
   
F I N D I N G S  

Table 5:  Error Rate by Setting and Error Type for Medicare  
Facet Joint Injection ServicesPhysician Claims, 2006  
Type of Error  Office  Facility  
Documentation*   49%  22% 
Coding  30%  32% 
Medical Necessity   10%  5% 
Any Error*  71%**  51% 
Source:  OIG analysis of medical review results, 2008.                                                   
*  Statistically  significant at the 95-percent confidence  level. 
                                          
** Numbers do not sum to total because of overlapping errors. 

 
In addition, certain physician specialties in our sample had high error 
rates in an office setting.30  See Table 6 for physician specialty error 
rates in an office setting for our sample.   For a complete list of specialty 
error rates in an office setting for our sample, see Appendix C.  
Table 6: Physician Specialty Error Rate in an Office Setting for Sample 
Percentage of 
Services With 
Specialty   an Error 
Specialty**   Code   Any Error in Office*  Services in Office*  in Office  
General Practice  01  36  37  97% 
Internal Medicine  11  13  15  87% 
Family Practice  08  7  9  78% 
Neurology  13  8  11  73% 
Rheumatology  66  5  7  71% 
Orthopedic Surgery   20  9  14  64% 
Anesthesiology   05  30  48  63% 
Pain Management  72  14  25  56% 
Physical Medicine and 
25  8  15  53% 
Rehabilitation 
Source:  OIG  analysis of  medical  review  results, 2008.                                                                                                                      
* Figures are  based  only  on the sample  and  are  not projected to the  population.                                                                             
** Only specialties with sample frequency  equal to or greater  than five  are shown here.  
  
 
 
 
30 Statement is based only on the sample and not on projection to the population. 
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   14   
   
F I N D I N G S  

 
In 2006, most carriers had policies and  The LCDs and claims processing  
safeguards for facet joint injection services but  edits are carriers primary tools to 
protect Medicare payments for 
they  identified limits to using these safeguards 
facet joint injections. Carrier  
staff, however, identified limits to 
using LCDs and edits to safeguard these services.  Carrier staff reported  
minimal use of other safeguards for facet joint injections. 
Almost all carriers had an LCD and at least one edit for facet joint injections 
In 2006, 13 of 15 carriers had LCDs for facet joint injections. Of carriers 
with an LCD, 10 had at least one active edit. Table 7 illustrates the 
safeguards each carrier had in 2006 for facet joint injection services. 
 
Table 7: Carrier Safeguards for Facet Joint Injection Services in 2006 
Claims Processing Edits 
Edits for 
Edits for  Edits for  Radiographic  
Carrier  LCD  Diagnosis  Frequency   Guidance   EditsOther 
  1  U   U        
2           
3  U  U   U  U   U  
4  U         
5  U   U   U      
6  U   U        
7  U          
8  U   U   U     U 
9  U   U       U  
10  U          
11  U   U        
12  U   U       U  
13  U   U   U     U  
14  U   U       U  
15           
           
  Total  13  10  4  1  6 
 
Source:  OIG interviews and document review, 2007.   
   
Local coverage determinations. Specific guidelines in LCDs varied by 
carrier.  For example, 13 carriers considered facet joint injections to be 
medically necessary for patients with certain diagnosis codes; however, 
the number of acceptable diagnosis codes varied  by carrier from 3 to 38. 
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F I N D I N G S  
Despite the variation in acceptable diagnosis codes, some commonalities  
in the guidelines exist.  Seven of the LCDs describe radiographic 
guidance as part of the standard of care for facet joint injections and 
require that providers use radiographic guidance for this service. In 
addition, six of the LCDs restrict providers from  performing  other  
interventional pain management procedures in the same anatomical 
region on the same day as a facet joint injection. Eight LCDs include 
frequency guidelines for diagnostic and therapeutic facet joint 
injections. 
Claims processing edits. Ten carriers implemented automated 
electronic edits to enforce the guidelines established by their LCDs.  
Carriers most commonly used the diagnosis edit, which automatically 
checks to ensure that physicians bill an acceptable diagnosis code for 
facet joint injections.  Four carriers  used frequency edits, which deny or 
flag claims that exceed a limit for facet joint injections established by 
the LCD.   
While half of the carriers require the use of radiographic guidance in 
their LCD, only one carrier in 2006 used an imaging edit to auto-deny 
facet joint injection claims billed without radiographic guidance.  
Carrier staff stated that the edit for radiographic guidance addresses 
two potential problems:  (1) a facet joint injection billed without 
radiographic guidance indicates that it was not performed with 
guidance, which could put the patient at risk; and (2) without 
radiographic guidance, the procedure might have been a trigger point  
injection, a lower paying pain management service.     
Several carriers also created unique claims processing edits.  For 
example, one carrier created an edit to deny any facet joint injection  
service billed on the same day as another pain management service.  
Another carrier created an edit that automatically suspends all claims 
with add-on facet joint injection codes for manual review because of an 
identified issue with add-on codes being billed to represent bilateral 
services. 
Other safeguards. Carrier staff did not report frequent use of other 
safeguards for facet joint injections, such as provider education and 
medical review.  Carriers reported that their routine data analysis did 
not identify specific outliers in the data for these services.  As a result, 
only three carriers conducted provider education and medical reviews 
for facet joint injections.   
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F I N D I N G S  
Carrier staff identified complexities to creating frequency limits for facet 
joint injections 
Generally, carriers use LCDs and edits to protect the integrity of 
Medicare payments and  control utilization for vulnerable services. 
Establishing frequency limits in LCDs and corresponding edits to 
enforce those limits is a  common technique.  However, carrier staff 
identified complexities that make frequency limits harder to implement 
for facet joint injections.  
Staff at two-thirds of carriers identified barriers to implementing 
frequency limits for facet joint injections.  First, one-third identified the 
lack of agreement in the  medical community about appropriate 
frequency for facet joint injections as a barrier to creating LCDs.  An 
additional one-third mentioned difficulty creating automated edits for 
facet joint injections.     
Lack of consensus about appropriate frequency is a barrier to creating 
frequency limits in local coverage determinations.  Carriers rely on clinical 
standards in the medical community to support specific guidelines in 
LCDs. However, the medical community has not yet established a body 
of evidence-based medicine to support frequency standards for facet  
joint injections.  In the absence of clear standards in the medical 
community, carriers must search for consensus among physicians who 
perform the services.  Reaching consensus is often challenging given 
that many different provider specialties perform facet joint injections  
and have varying opinions about the appropriate frequency.  
Four carriers have successfully reached consensus on frequency limits 
and enforce those limits with automated edits.  Staff at one carrier, 
however, reported that the limits were too high to identify potential 
problems.  
Frequency edits for facet joint injections are difficult to automate. Carrier  
staff report that even if they were able to establish frequency limits in 
their LCD, automated prepay frequency edits are inherently difficult for 
facet joint injections.  Many of the automated edits require information 
that is not currently available on Medicare claims.    
Specifically, carriers are not able to establish frequency edits that rely 
on spinal level.  Currently, the CPT and the claim do not distinguish 
spinal level.  The CPT code indicates what region  of the spine is 
injected, such as lumbar/sacral.  However, the CPT code does  not 
indicate which spinal level within that region was injected (such as    
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   17   
   
F I N D I N G S  

C5-C6). Without this information on  the claim, carriers cannot create 
specific frequency edits based on spinal level. 
Claims do not have enough information for carriers to distinguish a 
diagnostic injection from a therapeutic injection, which affects the 
accuracy of frequency edits.  Physicians generally do not perform 
diagnostic injections more than once, while therapeutic injections may 
be repeated multiple times.  Even with a specific frequency standard in 
an LCD for each, carriers would have difficulty editing for these services 
because claims do not indicate whether the service is being performed 
for diagnostic or therapeutic purposes. 
 
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   18   
   
  R E C O M M E N D A T I O N S  
 
Sixty-three percent of Medicare facet joint injection services in 2006 did 
not meet program requirements, resulting in approximately $96 million 
in improper payments to physicians and $33 million to facilities.  
Although carriers have LCDs and claims processing edits for these 
services, they will likely continue to experience problems safeguarding 
these services until there is a comprehensive body of medical evidence  
and consensus in the medical community about facet joint injections.   
Based on the results of  our review, CMS should:  
Strengthen Program Safeguards To Prevent Improper Payment for Facet 
Joint Injection Services                                                                                                  
To strengthen program safeguards, CMS could: 
Assist carriers in developing ways to scrutinize claims for facet joint injection 
services provided in an office setting. As error rates were significantly higher 
in an office setting than a facility, carriers may be able to identify 
problematic claims by examining place of service.    
Encourage carriers that require radiographic imaging guidance in their LCDs to  
implement automated edits for imaging guidance. Carriers that require 
radiographic imaging in their LCDs should implement automated edits for 
imaging guidance if they have not already done so.  The edit would auto-
deny any facet joint injection claim submitted without imaging guidance 
by checking for the procedure code(s) associated with radiographic imaging 
guidance.    
Direct carriers to revisit frequency limits in their LCDs for facet joint injections.  
Carriers should revisit the frequency limits in their LCDs and update 
them so that they are as effective as possible.  Carriers that currently have 
frequency edits for facet joint injections could revisit quarterly claims data 
to determine edit effectiveness.  
CMS bases current MUE limits for facet joint injections on previous billing 
patterns, which could be inflated because of inappropriate payments.  
These limits are not sufficient to identify inappropriate claims for facet 
joint injections. 
Clarify Billing Instructions for Bilateral Services 
CMS should clarify billing instructions for bilateral services and recover 
funds if appropriate.  CMS should address the fact that some providers  
obtain higher reimbursement than allowed by billing add-on codes to  
represent bilateral service.  CMS could accomplish this through a 
variety of mechanisms:  educating providers, issuing program 
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   19   
   
R E C O M M E N D A T I O N S  
 
memorandums, and encouraging carriers to flag add-on codes for 
additional review.  Correct billing for bilateral services could result in 
cost savings. 
Take Appropriate Action Regarding the Undocumented, Medically  
Unnecessary, and Miscoded Services Identified in Our Sample 
We have forwarded information on these services to CMS.  
AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL  
RESPONSE 
CMS described steps that it will take to address our recommendation to 
strengthen  program safeguards for facet joint injection services. CMS 
agreed with our recommendations to clarify billing instructions for 
bilateral services and to take appropriate action on services paid in 
error in our sample.   
To strengthen program safeguards for facet joint injections,  CMS plans 
to direct carriers to  review claims data, particularly for services 
performed in office settings, and establish additional safeguards as 
necessary.  CMS also plans to encourage carriers to consider automated 
edits for radiographic imaging where it is already required in their 
LCD. Finally, CMS expects that frequency limits will be addressed by 
the annual review of LCDs and by the Medicare Administrative 
Contractors (MAC) during contract consolidation. 
We continue to recommend that CMS instruct MACs and remaining 
carriers specifically to revisit frequency limits for facet joint injections 
during annual reviews or during MAC consolidation.  Without specific 
instruction by CMS, carrier annual reviews and MAC consolidation 
might not address the frequency recommendation in this report.  
Further, MAC reconciliation of LCDs could lead to less restrictive 
frequency limits. CMS comments describe how MACs reconcile varying 
frequency limits in LCDs and follow either the most clinically 
appropriate or the least restrictive requirement.  However, without 
medical community consensus on the clinically appropriate frequency 
for facet joint injections, MACs may default to the least restrictive 
requirement which, in some cases, could be no limit.  At the time of our 
study, 7 of 15 carriers did not have frequency limits in their LCDs.   
To clarify billing instructions for bilateral services, CMS will issue a 
Medicare Learning Network Matters article to educate providers on the 
proper use of add-on codes and the bilateral modifier. 
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   20   
   
R E C O M M E N D A T I O N S  
To address the services paid in error in our sample, CMS will review the 
claims data and direct Medicare contractors to  review the claims and 
initiate appropriate recoveries of potential overpayments.  
For the full text of CMSs comments, see Appendix D. 
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   21   
   
  A P P E N D I X ~ A
 
Detailed Methodology  
Sample Selection 
The population from which we sampled consisted of all the allowed 
physician services in the Centers  for Medicare & Medicaid Services 
National Claims History (NCH) file for Current  Procedural 
Terminology (CPT) codes 64470, 64472, 64475, and 64476 performed 
in 2006. We excluded services with allowed amounts less than     
$15 to avoid performing a medical record review on low-dollar 
claims.31  The population consisted of 1,072,841 services that 
represented $202,671,303 in allowed physician payments. We 
stratified the population based on place of service and             
Medicare-allowed amounts. The strata included services with low 
and high allowed amounts performed in physician offices, hospital 
outpatient departments, and ambulatory surgical centers (ASC).  
We took a stratified, simple random sample of 660 line items32 and 
excluded 6 services because of ongoing investigations by the  Office of 
Inspector General (OIG). Our final sample included a total of 654 
services.  Table 8 shows the six strata and the number of services in 
each stratum. 
 
Table 8: Population Count and Sample Size by Strata 
Number of  
Number of Services in  Services in 
Stratum  Medicare-Allowed Amount  Population  Sample 
1  Office  Greater than $300  242,806  108 
Greater than $15 and less 
2  Office  412,213  108 
than or equal to $300  
3  Hospital Outpatient  Greater than $100  50,916  109 
Greater than $15 and less 
4  Hospital Outpatient  170,891  110 
than or equal to $100 
5  ASC  Greater than $100  48,653  110 
Greater than $15 and less 
6  ASC  147,362  109 
than or equal to $100 
Total    1,072,841  654 
Source:  OIG sample stratification, 2008.  
 
31 These services represent less than 1 percent of the population. 
32 Hereinafter, line items will be referred to as services. 
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   22   
   
A P P E  N  D   I X  ~  A  
Data Collection 
We used a contractor to conduct the medical record request and 
review.  We requested, by mail, complete medical records and 
documentation from physicians for each of the 654 sampled services.  
We specified that physicians should include the following when 
available:  initial patient evaluation and exam, test results, 
radiographic evidence of needle placement, and  procedure notes.  For  
additional context, we also requested that physicians furnish all 
documentation for services provided to the beneficiary 4 months 
before and 1 month after the sampled date of service.    
We classified physicians for eight services as nonresponders. A          
nonresponder is a provider with whom no successful contact has been  
made after at least three written contacts and two phone calls.  The 
final request letters were sent by certified mail.  We based our review 
on the remaining 646 line items, corresponding to a 99-percent 
response rate. 
Test review. To test our review instrument and ensure uniformity 
among the reviewers, we conducted  a preliminary medical review of    
12 services.  These services were randomly sampled from the same 
population from which we drew our final sample using the same 
stratification.33   We analyzed the results of the test review and  
presented them to the reviewers.  Reviewers resolved inconsistencies in 
the results and suggested changes to the review instrument.  Some of 
these changes were incorporated into the final review instrument.    
Data Analysis 
Calculation of improper physician payments.  We calculated the total actual  
and projected dollars paid in error for these services.  For services that 
were not medically necessary, insufficiently documented, or not 
documented, we counted the  entire  Medicare-allowed amount as improper 
and projected the amount paid in error.  For services with a coding error,  
we determined if the error was a Medicare underpayment, overpayment,  
or had no effect on payment.  We calculated the total net difference for all 
services with a coding error and projected it to the population of facet joint 
injection services in 2006.  The only overpayments and underpayments 
included in the projection are cases for which we  could calculate the exact 
amount overpaid or underpaid.  We were able to calculate the exact 
 
33 This sample was drawn separately from the sample used  for our review. 
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   23   
   
A P P E N D I X ~ A  
amount overpaid or underpaid for 137 of the 173 miscoded services.  We  
were unable to calculate exact amounts for 36 services.  Of the 36 services,      
20 were for overpayments, 4 were for underpayments, and 12 were for 
services that had no effect or an unknown effect on payment.  For services  
for which we could not  determine the exact amount, we assumed there was 
no effect on payment.  As a result, the projected overpayment is a 
conservative estimate. 
Calculation of improper facility payments.  In addition, we calculated and 
projected the facility payments associated with the services that did not 
meet Medicare program requirements.  For ASC and outpatient claims,  we 
used the NCH Part B file and hospital outpatient file, respectively, and 
matched facility claims to physician claims using the date of service, CPT, 
and beneficiary identification. We were able to match 88 percent of 
sampled services performed in a facility to their associated facility 
payments.34   Finally, we projected the facility dollars associated with 
physician services paid in error.  
 
34 We matched 384 of the 485 sampled services in a facility.  We were not able to match 
the remaining facility payments to physician payments for a number of reasons, including  
facilities failure to submit a service and incorrect coding of the place of service by the 
physician. 
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   24   
   
  A P P E N D I X ~ B
 
Confidence Intervals for Selected Estimates 
 
Table 9: Estimates of All Errors 
Estimate Description   Point  Estimate   95-Percent Confidence Interval 
Percentage of services with any  error   63.1%  59.0%67.2% 
Percentage of services with any  documentation error  38.4%  33.8%42.9% 
Percentage of services with no documentation   27.5%  23.1%31.8% 
Percentage of services with insufficient documentation   10.9%  7.8%14.1% 
Percentage of services coded incorrectly    31.1%  26.7%35.4% 
Percentage of services that were  not medically necessary    8.1%  5.4%10.9% 
Percentage of services with overlapping errors  14.0%  9.8%18.2% 
Source:  Office of  Inspector General (OIG) analysis of medical review results, 2008.  
 
Table 10:  Estimates of Improper Physician Payments Associated With All Errors 
Estimate Description   Point  Estimate   95-Percent Confidence Interval 
Amount allowed for services with any error   $95,792,055  $84,298,604$107,285,504 
Amount allowed for services with any documentation error  $80,733,041  $69,246,854$92,219,228 
Amount allowed for services with no documentation   $58,587,140  $47,833,250$69,341,030 
Amount allowed for services with insufficient documentation   $22,145,901  $14,671,642$29,620,160 
Amount allowed for services coded incorrectly    $21,391,947  $13,902,518$28,881,376 
Amount allowed for services that were not medically necessary    $16,648,373  $9,919,301$23,377,445 
Amount allowed for services with overlapping errors   $22,981,307  $12,657,976$33,304,637 
Source:  OIG analysis of medical review results, 2008.  
 
 
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   25   
   
A P P E N D I X ~ B  

Table 11: Estimate of Improper Facility  Payments Associated With Any  Error 
Estimate Description   Point  Estimate   95-Percent Confidence Interval 
Amount allowed for services with any error   $32,697,195 $26,899,820$38,494,570 
Source:  OIG analysis of medical review results, 2008.  
 
Table 12:  Estimates of Miscoded Services 
Estimate Description   Point  Estimate   95-Percent Confidence Interval 
Percentage of miscoded services that affected payment   79.0%  71.8%86.1% 
Percentage and amount allowed for services affecting payment  81.6%  74.6%88.6% 
that were overpaid  $25,063,648  $18,022,097$32,105,198 
Percentage and amount allowed for services affecting payment  18.4%  11.4%25.4% 
that were underpaid  $3,671,701  $1,585,607$5,757,794  
Percentage of overpaid services because of a bilateral billing 
61.2%  50.3%72.1% 
error 
Source:  OIG analysis of medical review results, 2008.  
 
Table 13:  Estimates of Errors and Improper Payments by Setting 
Point 
Error Type   Setting   Estimate   95-Percent Confidence Interval 
Office  49.1% 42.1%56.1% 
Any Documentation Error 
Facility   22.2% 17.8%26.7% 
Office  30.3% 23.8%36.8% 
 
Coded Incorrectly 
Facility   32.2% 27.2%37.3% 
Office  10.3% 5.9%14.7% 
Not Medically  Necessary  
Facility   4.9% 2.7%7.2%  
Office  71.2% 65.4%77.1% 
Any Error 
Facility   50.8% 45.5%56.1% 
Source:  OIG analysis of medical review results, 2008.  
 
 
  OEI-05-07-00200   MEDICARE PAYMENTS FOR FACET JOINT  INJECTION  SERVICES   26   
   
  A P P E N D I X ~ C
Specialty Error Rate in an Office Setting for Sample 
 
Table 14: Physician Specialty  Error Rate in an Office Setting for Sample 
  Any Error in Office*  Services in Office*    
Percentage of 
Services With an  
Specialty   Sample  Sample  Sample  Sample  Error 
Specialty   Code   Frequency   Percentage  Frequency  Percentage   in Office  
Neurosurgery  14  3  2%  3  1%  100% 
General Surgery  02  1  1%  1  0%  100% 
Pathology   22  1  1%  1  0%  100%  
Nurse Practitioner  50  1  1%  1  0%  100% 
Emergency Room   93  1  1%  1  0%  100% 
Physician Assistant  97  1  1%  1  0%  100% 
General Practice  01  36  25%  37  18%  97% 
Internal Medicine  11  13  9%  15  7%  87% 
Family Practice  08  7  5%  9  4%  78% 
Neurology  13  8  6%  11  5%  73% 
Rheumatology  66  5  4%  7  3%  71% 
Pediatric Medicine   37  2  1%  3  1%  67% 
Orthopedic Surgery   20  9  6%  14  7%  64% 
Anesthesiology   05  30  21%  48  23%  63% 
Pain Management  72  14  10%  25  12%  56% 
Physical Medicine  
25  8  6%  15  7%  53% 
and Rehabilitation 
Interventional Pain 
09  2  1%  17  8%  12% 
Management 
Diagnostic 
30  0  0%  1  0%  0% 
Radiology  
Source:  Office of  Inspector General analysis of medical review results, 2008.                                                                                                         
* Figures are based only on the sample and are not projected to the population.  
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 A P P E N D I X ~ D  
 
Agency Comments 
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A P P E N D I X ~ D  
 
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A P P E N D I X ~ D  
 
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  A C K N O W L E D G M E N T S
 
This report was prepared under the  direction of Ann Maxwell, Regional 
Inspector General for Evaluation and Inspections in the Chicago 
regional office, and Thomas Komaniecki, Deputy Regional Inspector 
General. 
Laura Kordish served as the team leader for this study and Kelly 
Sullivan Waldhoff served as the lead analyst.  Other principal Office of 
Evaluation and Inspections staff from the Chicago regional office who 
contributed to this report include Nicole Hrycyk; central office staff who 
contributed include Doris Jackson, Sandy Khoury, Megan Ruhnke, and 
Barbara Tedesco. 
 
 
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