Department  of  Health  and Human  Services 
OFFICE  OF 
INSPECTOR  GENERAL 
PHYSICIAN  OFFICE  SURGERY 
JUNE  1993  , 
OFFICE OF INSPECIOR GENERAL 
The  mission  of the  Office  of Inspector  General  (OIG),  as mandated  by Public  Law 95-452, as 
amended,  is to protect  the  integri~  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 three  OIG  operating  components:  the  Office of Audit  Services,  the 
Office of Investigations,  and the  Office of Evaluation  and Inspections.  The  OIG  also informs 
the  Secretary  of HHS  of program  and management  problems  and recommends  courses  to 
correct  them. 
OFFICE OF AUDIT  SERVICES 
The  OIGS Office  of Audit  Services  (OAS)  provides  all auditing  sexvices 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  in order  to reduce  waste,  abuse,  and 
mismanagement  and  to promote  economy  and efficiency throughout  the Department. 
OFFICE OF INVESTIGATIONS 
The  OIGS Office  of Investigations  (01)  conducts  criminal,  civil, and administrative

investigations  of allegations  of wrongdoing  in HHS  programs  or to HHS  beneficiaries  and of

unjust  enrichment  by providers.  The  investigative  efforts  of 01  lead to criminal  convictions,

administrative  sanctions,  or civil money  penalties.  The  01  also oversees  State  Medicaid  fraud

control  units  which  investigate  and prosecute  fraud  and patient  abuse  in the  Medicaid  program.

OFFICE OF EVALUATION  AND  INSPECTIONS 
The  OIGS Office  of Evaluation  and Inspections  (OEI)  conducts  short-term  management  and 
program  evaluations  (called  inspections)  that  focus on issues of concern  to the  Department, 
the  Congress,  and the  public.  The  findings  and recommendations  contained  in these  inspection 
reports  generate  rapid,  accurate,  and up-to-date  information  on the  efficiency, vulnerability, 
and effectiveness  of departmental  programs.  This report  was prepared  in the  Kansas  City 
regional  office under  the  direction  of Jim Wolf, Regional  Inspector  General.  Project  staf~ 
Kansas City  Headquarters 
Tim Dold,  Project  Leader  Cathaleen  Ahern,  Program  Specialist 
Dennis  Tharp,  Program  Analyst  Barbara  Tedesco,  Statistician 
To obtain  a copy of this report,  call the Kansas  City Regional  Office  at (816) 426-3697.  EXECUTIVE  SUMMARY

PURPOSE 
To  evaluate  the  appropriateness  of the  surgical  setting,  the  medical  necessity  of the 
surgery,  and  quality  of care  for  selected  surgical  procedures  performed  in physicians 
offices. 
BACKGROUND 
The  volume  of outpatient  surgery  continues  to increase  as reimbursement  regulations 
change  for inpatient  surgical  procedures.  As medical  technology  improves,  more 
surgeries  are  being  performed  in outpatient  settings.  These  settings  include 
ambulatory  surgical  centers,  emergency  centers,  and  single/multi-specialty  physicians 
offices.  Surgeries  in these  settings  can be  as simple  as laceration  repair  and  as 
complex  as cataract  surgery. 
The  Health  Care  Financing  Administration  (HCFA)  is concerned  that  the  services 
provided  to  Medicare  beneficiaries  may  not  be  reasonable  and  necessary.  However, 
neither  the  Social  Security  Act  nor  the  Medicare  regulations  specifically  define  quality 
of care  for  particular  services  performed  in  an  office  setting. 
Until  recently,  the  quality  of procedures  rendered  to Medicare  beneficiaries  in 
physicians  offices  was not  subject  to any  type  of review.  Section  l154(a)(4)(A)  of the 
Social  Security  Act  required  that  Each  peer  review  organization  (PRO)  shall provide 
... a reasonable  allocation  of such  [quality  review]  activities  is made  among  the 
different  cases  and  settings  except  that  PRO  review in physician  offices  could  not 
begin  before  January  1, 1989.  Currently,  HCFA  is conducting  two pilot  projects 
involving  a total  of 10 PROS.  These  PROS will review  medical  services  provided  in 
physicians  offices.  However,  there  is no general  quality  of care  review  of physician 
office  surgery  currently  in place. 
METHODOLOGY 
We  selected  a sample  of surgeries  containing  procedure  codes  for bunionectomies, 
dilation  and  curettage,  and  excisions  of breast  lesions.  We  drew  the  sample  from  1989 
Part  B Medicare  Annual  Data  which  showed  these  surgeries  were  performed  in 
physicians  offices.  A medical  contractor  reviewed  office  medical  records  for  these 
surgeries.  We  also  obtained  allowable  charge  information  on  certain  procedure  codes 
from  11 Medicare  carriers. 
FINDINGS 
One-Fijlh of Medical  Records Reviewed  Dii  Not Document  Reasonable  Quali@ of Care 
i  The  physician  reviewers  found  that  in 25 of the  122 surgeries  (20 percent)  the  medical 
records  did not  document  reasonable  quality  of care.  This  projects  nationally  to  2,500 
physician  office  surgeries  for  those  procedure  codes  where  medical  records  do not 
document  reasonable  quality  of care. 
l%irteen Percent of the Medical  Records Did Not Document  an Indication  For Sugery 
The  physician  reviewers  found  in 16 of the  122 surgeries  (13 percent)  the  medical 
records  did not  document  an indication  for  surgery,  and  therefore  were  not  medically 
necessary.  Projected  nationally,  Medicare  paid  $603,058 for  medically  unnecessary 
bunionectomies  and  excisions  of breast  lesions. 
27zePhysiciank Once  Was Not An Appropriate  Setting for A  Small Number  of Su~eries 
The  physician  reviewers  found  that  in six surgeries  the  physicians  office  was not  an 
appropriate  setting  for  the  surgeries.  The  office  setting  was inappropriate  due  to the 
patients  level  of illness  or the  type  of anesthesia. 
In 16 Percent of Our Sample  Cases, I?rocedure Codes Did Not Match  ~he Su~eries 
Pe#ormed 
The  physician  reviewers  found  in 20 cases  that  the  specific  surgeries  performed  did not 
match  one  of the  procedure  codes  included  in this study.  In only one  instance  did a 
physician  bill a procedure  code  with  an  allowable  charge  that  was less than  the 
appropriate  procedure  code.  All the  others  were  billed  in excess  of the  allowable 
charge  for  the  correct  procedure  code.  The  difference  in allowable  charges  between 
the  submitted  procedure  code  and  the  correct  code  amounts  to $3,130.98.  This 
projects  nationally  to $313,098 in upcoded  claims  for the  procedure  codes  under  study. 
RECOMMENDATIONS 
PROS Shoukl Ektend  Their Review  to Surge~ Peflonned  in Physicians Ofjces 
The  results  of this  inspection  confirm  that  quality  assurance  and  peer  review  activities 
are  needed  in physicians  offices,  for the  reasons  cited  in section  1154 of the  Social 
Security  Act.  As discussed  in section  1154, (1) we have  demonstrated  problems  exist 
regarding  quality  of care,  (2) the  yield in terms  of numbers  and  seriousness  of quality 
of care  problems  is apt  to be  significant,  and  (3) there  is no other  source  of quality 
review,  quality  assurance,  or peer  review. 
AGENCY  COMMENTS 
We have  received  comments  on the  draft  report  from  HCFA.  While  HCFA  generally 
concurs  with  our  findings  and  recommendation,  they wish to defer  comment  on  the 
recommendation  pending  the  completion  of two PRO  pilot  projects  to test  the 
feasibility  of physician  office  review  and  the  development  of a review  protocol.  We 
ii  agree  that  information  gained  in the  pilot  projects  is important  and  should  be 
considered  in any proposal  to expand  review  in outpatient  sites. 
 
The  full text  of their  comments  is included  in Appendix  E. 
... 
111 TABLE  OF  CONTENTS 
EXECUTIVESUMMARY  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..i

INTRODLKXION  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...1

FINDINGS

Quality  of Care  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...4

Medical  Necessity  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...5

Appropriateness  ofSetting  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...5

Procedure  Coding  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ...6

RECOMMENDATIONS  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  7

AGENCY  COMMENTS  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  8

APPENDICES

A. Procedure  Codes  by Placeof  Service  . . . . . . . . . . . . . . . . . . . . . . . . . . . .  A-1

B. Methodology  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  B.:
c.:

C, Medical  Review  Worksheet.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 
D. Differences  in Allowable  Charges  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D-1

E. Health  Care  Financing  Administration  Comments  . . . . . . . . . . . . . . . . . .  E-1
 INTRODUCTION 
PURPOSE 
To  evaluate  the  appropriateness  of the  surgical  setting,  the  medical  necessity  of the 
surgery,  and  quality  of care  for  selected  surgical  procedures  performed  in physicians 
offices. 
BACKGROUND 
The  volume  of outpatient  surgery  continues  to increase  as reimbursement  regulations 
change  for inpatient  surgical  procedures.  As medical  technology  improves,  more 
surgeries  are  performed  in outpatient  se~tings.  These  settings  include  ambulatory 
surgical  centers  (ASCS), emergency  centers,  and  single/multi-specialty  physicians 
offices.  Surgeries  in these  settings  can be  as simple  as laceration  repair  and  as 
complex  as cataract  surgery.  The  following  illustrates  the  recent  increases  in the  total 
number  of surgeries  allowed  by Medicare  and  performed  in physicians  offices. 
FISCAL  YEAR  ALLOWED  PROCEDURES  ALLOWED  CHARGES 
1987  24,397,912  $1,387,857,158 
1989  30,010,156  $1,768,395,391 
1991  38,475,582  $2,027,877,728 
The  Health  Care  Financing  Administration  (HCFA)  is concerned  that  the  services 
provided  to Medicare  beneficiaries  may not  be reasonable  and  necessary.  Section 
1862(a)(l)(A)  of the  Social  Security  Act  states  that  Notwithstanding  any other 
provision  of this title,  no payment  may be  made  under  part  A or part  B for  any 
expenses  incurred  for  items  or services  which  ...are  not  reasonable  and  necessary  for 
the  diagnosis  or treatment  of illness  or injury or to improve  the  functioning  of a 
malformed  body  member.  However,  neither  the  Social  Security  Act  nor  the  Medicare 
regulations  specifically  define  quality  of care  for particular  services  performed  in an 
office setting. 
Section  1154(a)(4)(A)  of the  Social  Security  Act required  that  Each  peer  review 
organization  (PRO)  shall provide  that  . . .  a reasonable  allocation  of such  [quality 
review]  activities  is made  among  the  different  cases  and  settings  (including  post-acute-
care  settings,  ambulatory  settings,  and  health  maintenance  organizations)  except  that 
PRO  review  in physician  offices  could  not  begin  before  January  1, 1989.  In 
establishing  such  allocation,  the  organization  shall consider  (i) whether  there  is reason 
to believe  that  there  is a particular  need  for reviews  of particular  cases  and  settings 
because  of previous  problems  regarding  quality  of care,  (ii) the  cost  of such  reviews 
and  the  likely yield  of such reviews  in terms  of number  and  seriousness  of quality  of 
1  care  problems  likely  to be  discovered  as a result  of such reviews,  and  (iii) the 
availability  and  adequacy  of alternative  quality  review  and  assurance  mechanisms. 
Currently,  HCFA  is conducting  two pilot  projects  invoking  a total  of 10 PROS which 
address  peer  review  of services  provided  in a physicians  offices.  The  Delmarva 
Foundation  (Maryland  PRO)  is working  on a pilot  project  with  two PROS,  reviewing 
primary-care  services  provided  in physician  offices.  The  scheduled  completion  date  for 
this project  is September  1993.  The  other  project,  The  Wisconsin  Ambulatory  Review 
Project  (WARP),  involves  seven  PROS.  This project  will develop  and  assess  a system 
for monitoring  the  quality  and  cost  effectiveness  of ambulatory  medical  care  for  office-
based  practices.  The  WARP  began  December  1, 1989, and  was scheduled  to last  for 
two years.  It was  extended  through  November  1992. 
METHODOLOGY 
We  selected  a sample  of 364 surgeries.  We  drew  the  sample  from  1989 Part  B 
Medicare  Annual  Data  (BMAD)  which  showed  these  surgeries  were  performed  in 
physicians  offices.  We  chose  seven  procedure  codes  for bunionectomies,  dilation  and 
curettage  (D  & C),  and  the  excision  of a breast  lesion  to represent  the  more  complex 
surgeries  completed  in physicians  offices.  According  to BMAD  data,  these 
procedures  had  general  anesthesia  claims  associated  with at least  25 percent  of the 
surgeries.  A chart  showing  the  place  of service  of the  selected  codes  is shown  in 
Appendix  A. 
i 
We  obtained  copies  of medical  records  for  the  selected  surgeries.  We  worked  with 
Medicare  carriers  to  get  copies  of  claims,  beneficiary  payment  histories,  and  names 
and  mailing  addresses  of physicians  who  performed  office  surgeries.  We  obtained 
medical  records  for  247  surgeries.  For  a variety  of reasons,  we  were  not  able  to 
obtain  the  medical  records  for  the  remaining  117 surgeries.  A  detailed  explanation  of 
the  117 surgeries  is in Appendix  B. 
Based  on our  review  of these  records,  we determined  that  91 surgeries  had  been

performed  in hospitals  or ASCS.  The  medical  records  for the  remaining  156 surgeries

were  sent  to Forensic  Medical  Advisory  Service  (FMAS),  a medical  review  contractor.

The  FMAS,  working  with  the  Office  of Inspector  General  (OIG),  developed

worksheets  to review  the  medical  records.  The  worksheets  contained  a variety  of data

elements  that  focused  on preoperative,  operative,  and  postoperative  care.  Separate

worksheets  were  used  for each  of the  three  surgical  groups.  The  FMAS  used  surgeons

who were  experts  in their  specialty  to  develop  current  evaluative  criteria  for  each  of

the  procedures.  The  reviewers,  using professional  judgement,  completed  a narrative

summary  and  a worksheet  for  each  case.  An example  of a medical  review  worksheet

is in Appendix  C.

In their  review,  FMAS  found  that  14 of the  156 surgeries  were  not  performed  in the

office setting,  but  in a hospital  or ASC.  Also, FMAS  did not  complete  all of the

2  information  in the  medical  review  worksheets  for 20 surgeries  because  these  particular 
surgeries  did not  match  one  of the  procedure  codes  in this study.  The  medical  review 
worksheets  were  completed  for the  remaining  122 surgeries. 
We  also  obtained  allowable  charge  information  on certain  procedure  codes  from  11 
Medicare  carriers. 
We  conducted  our  review  according  to the  Quality Standards for Inspections  issued  by 
the  Presidents  Council  on Integrity  and  Efficiency. 
3
 FINDINGS

One-Fifih of Medical  Recor&  RevzewedDid Not Document  Reasonable  Quality of Care 
The  physician  reviewers  found  in 25 of the  122 surgical  cases  (20 percent)  that  the 
medical  records  did not  document  reasonable  quality  of care.  We  found  that  these 
cases involved  surgeries  in each  of the  three  surgical  groups.  Eighteen  were 
bunionectomy  cases,  four were  D & C cases,  and  three  cases  involved  the  excision  of 
breast  lesions.  This  projects  nationally,  for physician  office  medical  records  that  do 
not  document  reasonable  quality  of care,  to: 
The  physician  reviewers  found  that  in 16 of the  25  cases  the  preoperative  evaluations 
were  not  adequate.  In  one  case,  the  physician  reviewer  stated  there  is a marked  lack 
of information  regarding  a preoperative  history  and  physical  evaluation  and  laboratory 
studies.  In  another  case,  the  reviewer  noted  the  preoperative  evaluation  is lacking 
for  indications  for  surgical  intervention  as well  as  documentation  of vascular  status  and 
overall  history  and  physical. 
The  reviewers  also  found  that  3 of the  25 cases  had  postoperative  complications.  In a 
case  involving  a breast  lesion,  the  patient  developed  a postoperative  hematoma, 
(a localized  swelling  filled with blood)  which  took  several  months  to heal.  In a 
bunionectomy  case  a procedure  was performed  while  an existing  infection  of the  skin 
was present.  A cast  was applied  despite  the  infection.  The  patient  was put  on  an 
antibiotic  regimen,  but  complications  ensued. 
A distribution  of the  preoperative  and  postoperative  issues is shown  in the  table  on 
the  next  page. 
4
 DISTRIBUTION  OF  PREOPERATIVE  AND  POSTOPERATIVE  ISSUES

II Bunionectomy  18  14  2  I 
I  I r 
II  Breast  Lesion  3  2  1  I
1 
It
D&C  I 4  101  0 II 
Thirteen Percent of the Medical  Records Did Not Document  an Indication  For Sugery 
The  physician  reviewers  found  in  16 of the  122 surgeries  (13  percent)  the  medical 
records  did  not  document  an  indication  for  surgery,  and  therefore  were  not  medically 
necessary.  For  example,  one  reviewer  noted  there  is no  evidence  documenting  the 
indication  for  correction  of a bunion.  In  another  case  a reviewer  stated  that  there  was 
no  documentation  of the  necessity  for  the  removal  of a breast  lesion. 
The  16 surgeries  involve  14 bunionectomies  and  2 excisions  of breast  lesions.  Nine  of 
these  16 cases  are  also  among  the  25 cases  where  the  reviewers  determined  that  the 
medical  records  did  not  document  a reasonable  quality  of  care. 
The  physicians  were  paid  a total  of $6,030.58  for  the  16 surgeries.  Because  of our 
sampling  of records  for  only  seven  procedure  codes,  this  projects  nationally  to  only 
$603,058  (~52.3%)  for  medically  unnecessary  surgery  in physician  offices.  Therefore, 
this  estimate  can  vary  by  $315,441  for  a range  of $287,617-$918,499  at  the  90 percent 
confidence  level. 
l%e Physician  Of/ice  WW Not An Appropriate  Semhg for A  Small Number  of Surgeries 
The  physician  reviewers  found  that  in 6 of 122 surgeries,  the  physicians  office was not

an appropriate  setting  for the  surgeries.  The  office  setting  was inappropriate  due  to

the  patients  level  of illness  or the  type  of anesthesia  administered.  The  reviewers  also

found  1 of the  6 cases  not  to be  medically  necessary,  and  all 6 cases  are  among  the  25

cases where  the  reviewers  determined  that  the  medical  records  did not

document  a reasonable  quality  of care.

Level  of Illness

For  three  cases,  the  physician  reviewers  found  the  setting  was not  appropriate  for the

type  of procedure  given  the  patients  level  of illness.  For  example,  one  case  involved

an 80 year-old  female  that  underwent  a bunion  procedure.  TheA .  physician  reviewer 
stated  that  according  to the  medical  record,  the  patient  had  smalj vessel  disease  in the 
5
 lower  extremities.  For  this reason,  the  reviewer  stated  that  the  setting  for  the  surgery 
was not  appropriate. 
Type  of Anesthesia 
Physician  reviewers  determined  for three  D & C cases  that  the  setting  was not 
appropriate  due  to the  type  of anesthesia  administered,  In each  of these  cases,  the 
type  of anesthesia  included  an  IV sedative/hypnotic  and  local  anesthesia.  In one  of 
the  three  cases, the  type  of anesthesia  also included  an IV narcotic.  The  physicians 
administered  the  anesthesia  in these  cases. 
The  reviewers  stated  in each  of these  cases  that  the  setting  was not  appropriate 
because  of insufficient  monitoring  of anesthesia  and  inadequate  recording  of vital 
signs.  The  medical  records  did not  document  the  existence  of the  necessary  additional 
medical  staff to conduct  these  activities.  A reviewer  commented: 
It is important  that  the  patient  be monitored  carefully,  not  necessarily 
by an anesthesiologist  or anesthetist,  but  by a nurse  or physician  assistant 
who  could  appropriately  record  the  vital signs of the  patient  before,  during, 
and  after  the  procedure. 
In 16 Percent OJOur SampIe Cases, Procedure Codes Did Not Match  the Surgeries 
Pe@x_tned 
! 
The  physician  reviewers  found  that  in  20  cases  the  surgeries  documented  in  the 
medical  records  did  not  match  one  of the  procedure  codes  in  this  study.  For  each  of 
these  cases,  the  physician  reviewers  identified  the  correct  procedure  code. 
Through  the  carriers,  we obtained  allowable  charge  information  for the  revised 
procedure  codes.  We  requested  allowable  charges  for these  physicians  for  1989, the 
year  in which  the  surgeries  were  performed. 
Allowable  charge  information  was obtained  for  17 of the  20 cases.  We  found  that 
upcoding  occurred  in  16 cases  and  downcoding  occurred  in 1 case.  We  were  unable  to 
determine  a dollar  amount  for  the  remaining  three  cases.  For  example,  a carrier 
could  not  provide  allowable  charge  information  because  the  provider  never  billed  the 
procedure  code  in question  and  prevailing  information  had  been  purged  for  1989. 
We  compared  the  original  allowable  charges  with the  allowable  charges  for the  revised 
procedure  codes.  We  found  upcoding  in the  16 cases because  the  allowable  charges 
for the  original  procedure  codes  were  higher  than  the  allowable  charges  for  the 
revised  procedure  codes.  The  total  net  overpayment  amounts  to $3,130.98  as shown in 
Appendix  D.  Again,  our  use  of only seven  procedure  codes  in this study  allows us to 
project  our  results  only for those  codes.  This results  in a modest  national  projection 
of upcoding  of $313,098  (f44.6%).  This  estimate  can vary by $139,709  for  a range  of 
$173,389-$452,807  atthe  90 percent  confidence  level. 
6  RECOMMENDATIONS

PROS Shouki &end  Their Review  to Stugery Performed in PhynciansOffices 
We  recognize  that  the  role  of PROS  and  to some  degree  Medicare  carriers,  in 
conducting  the  quality  assurance  function,  is evolving from  a case-by-case  review  to 
general  studies  of medical  practice.  We believe,  however,  that  physician  office  surgery 
involving  complex  procedures  once  provided  only in an institutional  setting  deserves 
attention. 
The  results  of this  inspection  confirm  that  quality  assurance  and  peer  review  activities 
are  needed  in physicians  offices,  for the  reasons  cited  in section  1154 of the  Social 
Security  Act.  As discussed  in section  1154, (1) we have  demonstrated  problems  exist 
regarding  quality  of care,  (2) the  yield in terms  of numbers  and  seriousness  of quality 
of care  problems  is apt  to be  significant,  and  (3) there  is no other  source  of quality 
review,  quality  assurance,  or peer  review. 
The  findings  of  this  inspection  relating  to  quality  of care  should  be  compared  with  the

findings  of the  PRO  pilot  projects,  to  determine  whether  only  surgical  cases  or  ~

medical  and  surgical  cases  should  be  subject  to  the  review  allocation  required  by

section  1154.

Such  PRO  review  should  include:  (1)  assurance  that  medical  records  document

reasonable  quality  of care  (both  in  the  sense  that  documentation  is adequate  and  that

quality  care  is rendered),  (2)  that  physicians  perform  only  those  procedures

appropriate  for  an  office  setting,  (3)  that  physicians  perform  only  medically  necessary

procedures,  and  (4)  that  accurate  procedure  codes  are  used  to  submit  claims  for

physician  services.

7
 AGENCY  COMMENTS

We received  comments  from  HCFA  which  generally  concur  with  the  findings  in the 
report.  The  full text  of their  comments  are  included  in Appendix  E. 
The  HCFA  has  indicated  that  they wish to defer  comment  on the  recommendation 
that  PRO  review  be  extended  to surgery  performed  in physicians  offices  pending  the 
completion  of two PRO  pilot  projects  to test  the  feasibility  of physician  office  review 
and  the  development  of a review  protocol.  We  agree  that  information  gained  in the 
pilot  projects  is important  and  should  be  considered  in any proposal  to expand  review 
in outpatient  sites. 
The  HCFA  also  expressed  concern  regarding  our  estimates  and  our  ability  to 
distinguish  between  poor  quality  of care  and  poor  documentation.  The  following 
information  provides  additional  clarification  of these  points. 
Projections  of dollars  paid  for unnecessary  surgery:  The  projected  dollars  associated 
with medically  unnecessary  surgery  are  conservative  in that  they were  based  on our 
original  sample  of 328 claims  rather  than  the  122 cases  for which we obtained  records. 
The  206 cases  which we did not  review were  assumed  to represent  medically-necessary 
surgery. 
Projections  for poor  quality  care:  The  projection  for poor  quality  surgeries  in 
physicians  offices  is based  on the  122 cases  for which we obtained  records.  While  it is 
true  that  206 out  of our  original  sample  of 328 did drop  out,  due  to  either  miscoding 
of place  of service  or non-response  to our  request  for records,  the  remaining  122 cases 
are  still a random  sample.  The  distribution  of this resultant  sample  represents  a 
subset  of the  original.  Therefore,  the  estimates  of poor  quality  of care  and  the 
precision  given  in the  report  are  based  on this subset  of the  original  sample. 
The  HCFA  also  questioned  whether  poor  documentation  is sufficient  proof  of poor 
quality  of care  or lack  of an indication  for surgery.  We  agree  that  it is possible  that 
appropriate  care  was given in some  cases but  not  documented.  However,  the  vast 
majority  of cases  reviewed  were  almost  certainly  unnecessary  or of poor  quality.  For 
example,  medical  review  of quality  of care  revealed  that  in 18 cases  the  care  was poor 
regardless  of the  presence  or absence  of information.  In seven  cases  the  care  may 
have  been  appropriate,  but  missing information  in the  medical  records  made  it 
impossible  to tell.  In all cases  including  the  last seven,  the  missing  information  would 
hamper  appropriate  care  in cases  in which  another  physician  renders  care  following 
the  original  procedure,  and  must  use  an inadequate  record  of indications,  test  results, 
or other  pertinent  information.  HCFA  agrees  that  even  percentages  smaller  than 
those  we report  represent  serious  problems. 
The  HCFA  acknowledges  the  dangers  of administering  anesthesia  in physician  office 
settings  but  feels  it cannot  determine  the  relative  danger  because  the  offices vary 
8  greatly  instandard  ofcare,  equipment,  and  personnel  training.  Our  inspection  report, 
Surgery in Outpatient  Settings:  A Four-State  Study (OEI-07-91-01470),  released  in 
1992, identified  this danger  and  recommended  that  States  examine  their  licensure  rules 
to ensure  the  quality  of high-risk  outpatient  procedures,  such as those  performed 
under  general  anesthesia  or intravenous  sedation. 
The  HCFA  also  suggested  clarifications  of some  details  in the  report;  we have  made 
pertinent  modifications. 
9
 APPENDIX  A

1989 BMAD  Procedure  Codes  by Place  of Service 
Excision  of cyst, 
etc.,  from  breast  8.2  23.8  63.2  4.2 
Bunionectomy, 
Silver type  24.5  24.9  37.0  12.8 
Bunionectomy, 
Keller,  McBride 
or Mayo  type  27.3  22.9  39.9  8.9 
Bunionectomy, 
resection  of joint 
with  implant  13.6  26.1  48.6  10.9 
Bunionectomy, 
with  metatarsal 
osteotomy  22.3  25.4  42.4  8.6 
Bunionectomy,  by 
phalanx 
osteotomy  45,5  14.8  32.1  6.8 
Dilation  and 
curettage,  (non-
obstetrical)  9,9  29.1  55.4  5.1 
A -1
 APPENDIX  C 
MEDICAL  REVIEW  WORKSHEET 
EXAMPLE 
c-1  . .. .- - .- .-.  . . ..  . 
.3  ----
D~S  TASK  ORDER  26:  PHYSICIAN  OFFICE SURGERY  STUDY 
EXC1S1ON  OF  BREAST  LESION 
MEDICAL  REVIEW  WORKSHEET 
I.  PATIENT  IDENTIFICATION/DE140GRAPHIC  ELEMENTS: 
Unfque  identifier  code 
;:  I-IIC  number 
3.  Surgical  setting 
4.  Date  of  surgery 
5.  Age  of  patient 
6.  Race  of  patient 
7.  Sex  of  patient 
8.  Surgical  procedure  (use  HCPCS  codesj 
(Code  for  procedure  actually  done  as  documented;  not  necessarily 
what  was  submitted  to  HCFA for  reimbursement.  ) 
II. QUALITY  OF CAkE  ELEMEXTS

PREOPERATIVE

1.	 Indication  for  surgery  documented? 
(Describe  in  dictated  narrative  if  not  Indicated.  ) 
a.	 Presence  of  palpable  lump.  14ust  be  demonstrated  by 
palpation  on  physical  examination.  Includes  limp  which  has 
not  completely  subsided  after  needling  with  production  of 
fluid  or  has  recurred  after  needling  with  production  of 
fluid 
b.  Other  indication 
(Specffy)

(Describe  in  dictated  narrative.  )

2.	 Generally  not  indicated? 
(Describe  f.n  dictated  narrative.  ) 
a.	 Not  appropriate  procedure  for  lump  which  has  subsided  after 
needling  with  production  of  fluid,  L.s3.  ,  a  zesolve~ 
cyst 
1
 ,~d.,refbll[~U~ICd[  tiUIJfSC)r~  ~)e~-i;(cf~ 
)
unique  identifier  code 
b.	 Other  non-indication 
(Specify) 
3.  Preoperative  Screening 
a.  Mammography  or  sonography  performed? 
i.	 If  yes,  did  lesion  appear  to  be  a  cyst? 
.. 
ii.	 Did  le9ion  feel  like  a  cyst  upon  physical
examination? 
iii.	 If  lesion  appeared  to  be  a cyst  on  mammogram  or 
sonogram  or  appeared  to  be  a  cyst  by 
physical  examination  (yes  to  -3ai.  or  3aLi.)  was  an 
aspiration  biopsy performed? 
b.	 Is  there  documentation  of  historical  questioning  regarding 
bleeding  or  coagulation  problems? 
i..	 If  yes,  was  a  bleeding  or  coagulation  problem 
identified? 
ii.  If yes,  were  coagulation  studies  done? 
c.	 IS  there  documentation  of  historical  questioning  regarding 
cardiac  or  pulmonary  disease? 
i.	 If yes,was a  signiff.cant  cardiac  or  pulmonary  disease 
identified? 
ii.	 If  3cL  =  yes  and  if  patient  is  >40  and  received 
anesthesia,  was an ECG done within three weeks prior to 
procedure? 
iii.	 If  3ci.  =  yes  and patient >40 and received anesthesia, 
was  a  chest  x-ray  done within  three  weeks  prior  to 
procedure? 
4.  Preoperative  Iiistory  and  Physical 
a.	 Is  there  documentation  of  a  history  and  physical  having  been 
done  by  the  operating  surgeon? 
b.  Is there documentation concerning a history  and  physical  or 
medical  clearance  from  the  patients  general  medical 
physician? 
2
 Unique identifier code

Was  an anesthesiologist or CRNA indicated  for this case? 
c.	
(Answer yes if an anesthesiologist or CRNA was present or 
there  was  a  need  for  monitoring  or  supervision  by 
anesthesiologist  or  CilNA.) 
i.	 If  yes,  is  preoperative  anesthesia  review 
documented? 
ii.  If  yes,  adequate? 
iii.  Performed  by anesthesiologist?

iv.  Performed  by CRNA? 
d.	 Were  the preoperative  evaluations  adequate? 
(If IV sedation or general  anesthesia,  should  have  either  a 
history  and  physical  by  surgeon  or  medical  clearance  or 
history  and  physical  by  general  medical  physician  within  one 
week  prior  to  procedure.  Local  anesthesia  requires  only  a 
brief  history  and  physical.  If  inadequate,  describe  in 
dictated  narrative.  ) 
5.  Consent  form  in record?

6.  If IV sedation  or general  anesthesia: 
a.  Was  preoperative  blood  pressure  documented? 
b.  Was  preoperative  pulse  documented?

c.  Was preoperative  temperature  documented? 
d.	 If  yes,  were  vital  signs  appropriately  stable  prior  to 
procedure? 
7.	 If IV sedation or general  anesthesia,  was  patient  NPO prior  to

procedure?

~ If  no,  describe  In  dictated  narrative.  ) 
8.	 Appropriateness  of  setting: 
(If  any  no,  describe  in  dictated  narrative.  ) 
a.	 Was the setting appropriate for the type  of  procedt~re  given 
the  patients  level  of  illness? 
b.	 Was  thetype  of  anesthesia  administered  appropriate  for  the 
patient? 
c.	 Was  the  setting  appropriate  for  the  type  of  anesthesia 
administered? 
3  Unique  identifier code

d.  Was a mass present only on mammogram or sonogram, i.e., not

on	 palpation? 
(In  that case would  require  needle  localization  in  x-ray 
department,  and  would  not  be appropriate  for  office 
setting..)

OPERATIVE

1.	 If  IV  sedation  or  general  anesthesia,  did  patient  have  IV

inserted  for duration of procedure?

2.  Total operating  (procedure) time:  min.

3.	 Total anesthesia  time:  min. 
(If  no  anesthesia  time  was  documented  and  the  anesthesiologist  or 
CRNA  was  not  present,  enter  N/A  for  not  applicable.  ) 
4.  Type of anesthesia:  Administered by:

a.  Intravenous  narcotic 
b.  Intravenous  sedative/hypnotic

c.  Local 
d.  General 
5.	 If  IV sedation or general anesthesia, does record document vital 
signs during surge~? 
a.  If yes, completed  by: 
i..  Anesthesiologist 
ii.  Surgeon 
iii..CRNA 
iv.  Other RN 
v.	 Other 
(Specify) 
4
 ~-o[e~ic  Medical  Adukorg  Se,~vLce 
unique identifier code

6.	 Intraoperative  complications? 
(Describe  in dictated narrative. ) 
a.  If yes, was procedure completed?

b.  If complication, appropriate intenention?

c.  If yes to any above, related to anesthesia?

d.  If yes to any above, related to setting?

7.  If procedure was begun under local, was it necessary to advance 
to	 IV sedation or general anesthesia?

(If yes, describe in dictated narrative. )

8.  Pathological  diagnosis documented? 
a.	
If  yes,  list  pathological  diagnoses  below  and  describe  in 
dictated  narrative. 
POSTOPERATIVE

1.	 Complications?  (If  yes,  check  any  that  apply. 
Describe  in
dictated  narrative. ) 
a.
 Infection

b.
 Inci.sional skin slough

c.
 Incomplete removal

d.
 Severe postoperative pain

e.
 Significant  postoperative  deformity

f.  Significant  hematoma

9*  Other

(Specify)

(Describe in dictated narrative. )

h.
 If yes to any above, related to anesthesia?

i.
 If yes to any above, related to setting?

5
 Unique identifier code

2.	 Was  there  documentation  of  postoperative  instructions  being 
given? 
3.  Were  postoperative  medications  hdicated? 
a.  If yes, were they appropriately administered?

4.	 Surgical  followup  (postoperative  visit)  within  10  days  after 
surgery? 
5.  Was a postoperative management plan documented? 
6.  Was  there  a  postoperative  note  prior  to  discharge? 
a.	 If  yes,  documented  by: 
i.  Anesthesiologist 
ii.  Surgeon 
iii.  CRNA

iv.  Other  RN

v.	 Other

(Specify)

7.  a.  If  IV sedation or general anesthesia given: 
i.  Was postoperative  blood  pressure documented? 
ii.  Was postoperative  pulse  documented?

b.  If  yes,  were  vital  signs  appropriately  stable  before

discharge?

(If no, describe in dictated 
narrative. )

8.  Patient  alive?

(Describe death or transfer in dictated narrative. )

a.  If yes, patient released home?

(Answer  yes  if  nursing  home  resident  returns  to  nursing

home. )

b.	 If yes, patient transferred to hospi.ta~? 
(Yes,

if direct admit.)

6  c.  If yes, patient transferred (not to hospital)?

d.	 If transferred,  specify location.

-

9.  Admitted to hospital within 15 days (related to procedure)?

(Describe in dictated narrative. )

10.
 Did  patient  have  followup  surgery  within  15  days  related  to

previous procedure?.

(Describe  in dictated narrative. )

11.
 Overall,  was  a reasonable  quality  of  care  documented  in this

pati,ents  medical  record?

(If  no,  describe  in dictated  narrative  and  indicate need for

second reviewer under Part 111.2.)

PART  III:  RKVIEW INFORMATION

1.  Reviewer  ID:

2.  Second  reviewer  needed?  *[[

(Second  reviewer  needed  if  j%  above  is  no  or  for  other

significant  quality  or medical  necessity  issues. )

3.  If yes,  second  reviewer  ID

4.  Does  second  reviewer  agree  with  the  opinion  of  the  first 
reviewer? 
( lf  no,  describe  in  dictated  narrative.  ) 
5.  Date  of  first  revj.ew:  /  I 
   
6.  Date ofsecond review: 
_/_/_.

7  ~-ofenslc~
edicaf  Adukory  Seruice 
Answers  to questions  are indicated  according to  the following code

unless othemise  specified:

1 = YES

2 = NO

3 = NOT  DOCUMENTED  OR  CANNOT  TELL  ( N/D) 
4=  NOT APPLICABLE  (N./
 A)

Exceptions:

Identification/Demographic  Question  3  . 
~  =  office 
2  =  Other 
Demographic  Information  Quest-ion  6 
1 =  l?hite 
2 =  Black 
3 =  Asian 
4 =  American  Indian 
5 =  Spanish  origin/Hispanic 
6 =  Not  Documented 
Demographic  Information  Question  7 
1 = Male 
2 = Female 
3 = Unknown 
Operative  Questions  z.  and  3. 
are  indicated  with  actual  time  in
minutes. 
Operative  Questions  4a.,  4.b.,  4.c.  and.4 d

. . have  the  following

legend: 
Administered  by:

a. = Mesthesiologist

b.= Surgeon

c. = CRNA

d. . other RN

e.  Other

f. = Not documented or camot  tell

9* = Not applicable

Reviewer  Information Questions  1 and 3 = Three digit coded  physician 
number. 
Reviewer  Information Questions  5 and 6 = mm/dd/yy.

8
 APPENDIX  D

DIFFERENCES  IN ALLOWABLE  CHARGES 
$i$::(.~i%;?%: ;%:($f%i:$:::$(@i:$?~;j;..j;..;,:?(p:e;: ;;;:g::%g::i{::.::(~)l:.;!!:.
~g@ggQ:,  gg~~pg~gj	 ~R.GYis..$8FQ:2?e Y!3g?@$!D:<Il:j!:FEREg$x 
:<.:qQQE?&@;q~GR  ;;:w$~ .Q,. qE}\  :i$.LL?w@E:;.E@Tw@N
.,,  ,..  ,.. ,,.  .,  :,,,,...,,;.i ,;~.;;;: &!>cm$@j;::? x  :.;,::.:P(P)).:...i&(. 
28293  779.00  28285  339.30  439.70 
28292  565.50  28110  295.00  270.50 
28292  848.25  28285  510.30  337.95 
28292  475.10  28110  307.50  167.60 
58120  280.07  57800  57.97  222.10 
58120  264.20  58100  292.03  (27.83)3 
58120  212.80  58100  54.10  1.58.70 
58120  203.60  58100  40.80  162.80 
58120  130.00  57500  49.80  80.20  7 
58120  239.20  58100  50.40  188.80 
58120  210.00  58100  55.20  154.80 
58120  165.99  58100  52.15  113.84 
58120  224.02  58100  49.30  174.72 
58120  249.60  58100  40.70  208.90 
19120  400.00  11402  100.00  300.00 
19120  226.10  11401  75.00  151.10 
19120  75.00  11400  47.90  27.10 
TOTALS  $5,548.43  $2,417.45  $3,130.98 
1  Allowablceh argef ortheprocedurceodebilled. 
2  Allowablceh argef ortheprocedurceo dematchintgh esurgerpyerformed. 
3  TheMedicarec arrieard visetdh atthephysicinaenv erbilletdh erevisepdr ocedure
D-1
 APPENDIX  E 
HEALTH
CARE FINANCINGADMINISTRATION  COMMENTS 
E-1  7 
DEPARTMENT  OF HEALTH & HUMAN  SERVICES  Financing  Administration 
~..  +--ii2i,  ,, 
-.  Memorandum 
..
,,,0
Date 
~T~%,@  - R  2G ~ 
From 
Acting  Administrator 
.. 
Officeo finspectoGre neral(OIG)-Dra-ftR-eport:PhysiciOafnf icesurgery

Subject 
(OEI-07-91-00680)

TO  BryanB.Mitchell

PrincipaDle putyinspectoGre
nera

We  reviewed  the  above-referenced  report  which  evaluates  theappropriateness 
of the  surgical  setting,  the  medical  necessity  of the  surgeqr,  and  quality  of care  for 
selected  surgical  procedures  performed  in physicians  offices.  The  report  concludes 
that  physician  office  surgery  suffers  from  both  quality  and  utilization  problems.  As  a 
result,  OIG  recommends  that  the  Peer  Review  Organizations  (PRO)  extend  their 
review  to  surgery  performed  in physicians  offices.  The  report  further  suggests  that 
its findings  be  compared  to  findings  from  PRO  pilot  projects  on  physician  office 
review. 
LVeWOU{L1liketo~e[erComnlenton the  recommendation.The PRO  pilot 
projects  lver-e designed  to  test  the  feasibility  of  physician  office  review  and  to  aid  in 
[he  development  of a revieiv  protocol.  These  pilot  projects  are  still  ongoing  anti  the 
results  are  preliminary.  After- these  projects  are  completed,  we  plan  to develop 
irnplemen[a(ion  options  \vhich  would  relate  to  the  monitoring  of both  medical 
services  and  surglcai  procedures  and,  at that  time,  will  take  into  account  OIGS 
recommendation.  our  detailed  comments  are  attached  for your  consideration. 
Thank  you  for  the  opportunity  to review  and  comment  on  this  draft  report. 
Please  advise  if  with  our  position  on  the  reports  recommendation  at 
us  you  agree 
your  earliest  convenience. 
Attachment  Comments  of the  Health  Care  Financin~  Administration  (HCFA)

on  Office  of Inspector  General  (OIG\  Draft  Report:

Phvsician  Office  Survey

0EI-07-91-O0680

Recommendation 
PROS  should  extend  their  review  to surgery  performed  in physicians  offices. 
HCFA  Response 
Because  Peer  Review  Organization  (PRO)  review  of physician  office  care  is an 
important  and  complex  area,  careful  attention  in the  development  of good  review 
methods  is necessary  before  implementing  this  new  PRO  review  system.  Recognizing 
the  uncertainty  of  how such  review  could  best  be  performed,  beginning  in  1989, 
HCFA  funded  pilot  projects  to expiore  alternative  approaches  to  physician  office 
review.  We  believe  that  we must  await  the  results  of these  projects  and  develop 
options  for  implementation  before  we can  conduct  a review  of medical  and/or 
surgical  services  provided  in physicians  offices.  We  hope  to be  ready  to  implement 
such  review  beginning  with  the  Fifth  PRO  Contract  Cycle  in  1996. 
Although  \ve agree  that  the  physician  office  is a likely  and  appropriate  setting  for 
further  PRO  review,  our  ability  to  move  forward  with  sucil  reviews  wiIl also  depend 
largely  on  obtaining  additional  funding.  The  cost  of the  PRO  program  would 
dramatically  increase  with  the  inclusion  of physician  office  review,  even  if limited  to 
surgical  procedures.  The  actual  cost  increase  would  be  based  on  the  Ievel  and  type 
of review  required.  In the  current  cost  cutting  environment,  HCFA  may  have  a 
difficult  time  obtaining  additional  funds  for  the  PRO  program  without  substantial 
outside  support.  [n  light  of  the  medical  communitys  resistance  to  PRO  physician 
office  review,  this  support  may  be  difficult  to  secure. 
Genera]  Comments 
Executive  summary,  page  i, Background,  third  paragraph,  second  sentence 
should  read:  Section  1154(a)(4)(A)  . . . except  that  PRO  review  in physician 
offices  could  not  begin  before  January  1, 1989. 
Introduction,  page  2, first  paragraph,  sixth  sentence,  after  years  an  additional 
sentence  should  be  added  to  read  - It was  extended  for  1 more  year. 
pages  2-3, we  have  some  concern  over  the  small  size  of the  sample,  as well  as  its 
randomness  after  so large  a number  of cases  selected  were  removed  from  the 
sample  prior  to  (or  during)  the  actual  review.  Page  2 
	 The  purpose  of the  study  is stated  as:  To  evaluate  the  appropriateness  of the 
surgical  setting,  the  medical  necessity  of the  surge~,  and  quality  of care  for 
selected  surgical  procedures  performed  in physicians  offices.  In the  findings 
section  of  the  report,  under  the  heading  One-fifth  of Medical  Records  Rewewed 
Did  Not  Document  Reasonable  Qualitv  of Care  (pages  4-5),  the  report  states 
that  the  medical  records  did  not  document  reasonable  quality  of care  in 
20 percent  (25 of  122) cases.  Under  the  heading  Thirteen  Percent  ofOffice 
Sur~eries  Were  Not  Medicallv  Necessan(page5), thereport  states  that  the 
medical  records  did  not  document  an  indication  for  surgexy  in  13 percent 
(16  of  122)  cases. 
OIG  apparently  assumes  that  poor  documentation  proves  that  a poor  quality  of 
care  emsted and  that  an  indication  for  surgery  was  not,  in fact,  present.  This 
may  have  been  the  case.  However,  since  the  physician  reviewers  did  not  request 
additional  information  from  the  physicians  under  review,  it is difficult  to assess 
whether  the  concerns  encountered  reflected  poor  quality  of  care  and  lack  of 
medical  necessity  or simply  poor  documentation.  Although  good  documentation 
can  establish  the  medical  necessity  and  good  quality  of care  for  a procedure,  it is 
not  necessarily  true  that  poor  documentation  proves  that  the  medical  necessity 
for  a  procedure  was  not  present  or  that  a poor  quality  of care  was rendered. 
Therefore,  it  reasonable  to  assume  that  the  true  figure  for  poor  quality  of care 
is 
is below  20 percent  and  thut  the  true  figure  for a lack  of medicaI  necessity  for 
the  procedure  is less than  13 percent.  We  would  agree,  however,  that 
percentages  considerably  less  than  these  figures  are  still a significant  cause  for 
concern. 
	 OIG  projects  that  Medicare  paid  $603,058  for medically  unnecessary 
bunionectomies  and  excisions  of breast  lesions  (presumably  in  1989) (page  5). 
Again  this  figure  is likely  to  be  somewhat  inflated  since  thephysician  reviewers 
in the  study  made  their  decisions  according  to the  documentation  in the  medical 
record  alone  and  did  not  request  additional  information. 
	 The  report  states  that  6 of  122 surgeries  were  performed  in  an  inappropriate 
setting  (page  5).  This  figure  points  up  a problematic  area  in  the  review  of care 
rendered  to  Medicare  beneficiaries.  Presently,  there  is no  routine  way of 
identi~ing  these  cases  for  medical  rewew.  If, after  office  surge~,  a patient  is 
admitted  to  a hospital,  some  of these  cases  may be  identified  by the  PRO  in the 
course  of its review  of its sample  cases.  Page  3 
The reports tatetsh atthreecasesw eredeterminetdo havebeenperformedi n
aninappropriasteet tindgu etothetypeofanesthesiinav olve(dp age6).Itk
difficutlotd eterminteh erelatidvaen gerso ftheadministratoifoann esthesiina 
officsee ttingsP.h ysicianosff iceasr enotroutineilnys pecteodr certifibeyd any 
grouporagency.Thereforet,h estandarodf carep,r esencoef necessary 
equipmenta,n dthetrainionfgp ersonnevlarygreatly. 
~	 The  report  states  that  procedure  codes  did  not  match  the  surgery  performed  in 
20 cases  (page  6).  In  16 of the  cases,  the  procedure  was  determined  to be 
upcoded.  For  the  7 procedures,  OIG  projects  a cost  of upcoding  at $313,098. 
This  finding  presents  one  of the  difficulties  inherent  in reviewing  office 
procedures  from  a cost  containment  perspective.  The  medical  review  of office 
records  by the  clinicians  necessa~  to make  the  determinations  involved  is an 
expensive  process.  To  limit  the  costs  of review,  it is usually  performed  on a 
focused  or  targeted  basis.  Thus,  it is expected  that  a certain  amount  of upcoding 
in the  general  population  of claims  will not  be  identified.