Department  of  Health  and  Human  Services 
OFFICE  OF 
INSPECTOR  GENERAL 
Imaging  Services  for 

Nursing  Home  Patients: 

Medical  Necessity 
JUNE  GIBBS  BROWN 
General 
AUGUST  1997  -
OEI-O9-9500092  OFFICE  OF INSPECTOR  GENERAL 
The mission  of the Office  of Inspector  General  (OIG),  as mandated  by Public  Law 
95-452,  is to protect  the integrity  of the Department  of Health  and Human  Services 
programs  as well as the health  and welfare  of beneficiaries  served by them.  This  statutory 
mission  is carried  out through  a nationwide  program  of audits,  investigations,  inspections, 
sanctions,  and fraud  alerts.  The Inspector  General  informs  the Secretary  of program  and 
management  problems  and recommends  legislative,  regulatory,  and operational  approaches 
to correct  them. 
Offke  of Evaluation  and Inspections 
The Office  of Evaluation  and Inspections  (OEI)  is one of several  components  of the Office 

of Inspector  General.  It conducts  short-term  management  and program  evaluations  (called 

inspections)  that focus on issues of concern  to the Department,  the Congress,  and the 

public.  The inspection  reports  provide  findings  and recommendations  on the efficiency, 

vulnerability,  and effectiveness  of departmental  programs. 

OEIs  San Francisco  Regional  Office  prepared  this report  under the direction  of 

Kaye D.  Kidwell,  Regional  Inspector  General,  and Paul A. Gottlober,  Deputy  Regional 

Inspector  General.  Principal  OEI staff included: 

REGION  IX  HEADouARTEI2s 
Brad Rollin,  Project  Leader  Stuart Wright,  Program  Specialist 

Robert  Gibbons,  Project  Leader 

Kathy  Dezotte 

Don Loeb 
1-

ThomasPurvis 

Joseph  Corso,  Consultant 

To obtain  a copy  of this report,  call the San Francisco  Regional  Office  at 415437-7900.  EXECUTIVE  SUMMARY 
PURPOSE 
This  inspection  determined  the medical  necessity  of imaging  services  provided  to residents 
of nursing  homes  and paid by Medicare. 
BACKGROUND 
Nursing  homes* arrange  for ancillary  services--such  as x-rays  and electrocardiograms 
(EKGs)--for  patients  who require  them.  In some instances,  firms  known  as potiable x-ray 
suppliers provide  x-ray  and EKG services  in nursing  homes. ** According  to Medicare 
regulations,  all imaging  services  must be ordered  by a physician.  To assess the medical 
necessity  of imaging  services,  we reviewed  729 imaging  services  that nursing  home 
patients  received  in 1994. 
FINDINGS 
Less than 2 percent of chest x-raysprovided to nursing home patients in 1994 were 
medically unnecessary or undocumented 
Of the $120 million  that Medicare  paid for chest x-rays during  1994,  it paid less than 
$1 million  for medically  unnecessary  and undocumented  services.  The quality  of portable 
chest  x-ray  images  is acceptable  in more  than 90 percent  of cases. 
In contrast to chest x-rays, 25 percent of EKGs provided to nursing home patients in 
1994 were medically unnecessary or undocumented 
In  1994,  approximately  12 percent  of EKGs were medically  unnecessary,  and in more 
than  13 percent  of cases,  documentation  was inadequate.  Medicarepaid  almost 
$32 million  for EKGs for  nursing  home patients  in 1994.  This included  paying 
$8.4  million  for  194,000  medically  unnecessary  or undocumented  EKGs.  High volume 
physicians  and suppliers  comprise  a very  small proportion  of providers  in general,  but 
they  accounted  for approximately  9 percent  of all medically  unnecessary  and 
undocumented  EKGs in  1994.  Portable  suppliers  are much more  likely  to be paid  for 
undocumented  EKGs than  non-portable  suppliers. 
For purposesof this inspection,  nursing homes refers to skilled nursing,  Medicaid nursing,  board and 
 
care,  assisted living,  and retirement  facilities. 
* Otheroptionsfor nursing  facilities  include providing  the service with theii  own equipment  or 
 
transporting  patients to hospital  outpatient  departments,  imaging centers,  physician  offices,or other  facilities. 
i  The HCFA should require that Medicare contractorsprofile high volume EKG suppliers 
and physicians to determine if they routinely billfor  medically unnecessary and 
undocumented EKGs 
AGENCY  COMMENTS 
We received  comments  on the draft  report  from  HCFA  and the Assistant  Secretary  for 
Planning  and Evaluation.  Both HCFA  and the Assistant  Secretary  for Planning  and 
Evaluation  concurred  with our recommendation.  We have  made minor  clarifications  in 
the report  in response  to technical  comments  made by these  agencies. 
ii  TABLE  OF  CONTENTS 
PAGE 

EXECUTIVE  SUMMARY 

INTRODUCTION  . . . . . . .  . . .  . . . . .  ........................  . . . . .  1 

FINDINGS  . . . . . . . . . . . .  . . .  . . . . . . ........................  . . . . . 6 

  Medical  necessity  of chest x-rays  . . . . 
 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  6 
  Medical  necessity  of electrocardiograms 
 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 
RECOMMENDATION  . . . . . . . . . . . . . 
 ......................  9 
APPENDICES 

A:  OIG Medical  Review  Criteria  . . . . . . . 
 . . . . . . .  ....................  A-l 
B:  Confidence  Intervals  ..........................................  B-l 
C:  Agency  Comments  ...........................................  C-l  INTRODUCTION 
PURPOSE 
This  inspection  determined  the medical  necessity  of imaging  services  provided  to residents 
of nursing  homes  and paid by Medicare. 
BACKGROUND 
Medicare (PartsA and B) 
Congress  enacted  Medicare  in  1965 to provide  health  services  to the elderly  and disabled. 

The program  consists  of two distinct  parts.  The first part  is hospital  insurance  or Part A. 

Part  A covers services  furnished  by providers, i.e.,  hospitals,  home  health  agencies,  and 

skilled  nursing  facilities.  The second part,  supplementary  medical  insurance  or Part B, 

covers  a wide range  of medical  services  and supplies.  These  include  physician  services, 

outpatient  hospital  services,  diagnostic  laboratory  tests,  x-rays,  ambulance  services,  and 

durable  medical  equipment. 

The Health  Care Financing  Administration  (HCFA)  administers  Medicare  and contracts 

with private  insurance  companies  to process  and pay claims.  Contractors  that process 

Part A claims  are referred  to as fiscal intermediaries.  Contractors  that process 

Part B claims  are called  carriers.  Some companies  have both  fiscal  intermediary  and 

carrier  contracts. 

The HCFA  provides  substam@  guidance  to fiscal  intermediaries  and carriers  on 

applicable  laws,  regulations,  national  polices,  fee schedules,  and other  requirements.  In 

some areas,  federal  law and HCFA  allow  the fiscal  intermediaries  and carriers  latitude  in 

determining  both  coverage  and reimbursement. 

Skilled Nursing Facilities and Other Extended Care Facilities 
The Medicare  program  provides  coverage  under  Part A for skilled  nursing  services  but 
not for custodial  care.  The  skilled  nursing  benefit  includes: 
nursing  care, 

b 
b  bed and board, 

b  physical,  occupational,  and speech therapy, 

b  medical  social  services,  and 

b  drugs,  biologicals,  supplies,  appliances,  and equipment  for use in the facility. 

 An exception  to this general rule is that fiscal intermediaries  prockss Part B claims submitted 
by hospitals  (for  inpatient  and outpatient  services),  home health agencies,  and skilled nursing  facilities.  Medicare  law stipulates  that beneficiaries  are eligible  for skilled  nursing  benefits  if they 
are transferred  to the skilled  nursing  facility  after  a minimum  3day  covered  stay in an 
acute hospital.  The patient  must require  skilled  nursing  care,  and a physician  must order 
the services.  Part A covers  skilled  nursing  services  for up to  100 days per  spell of 
illness.  
In addition  to skilled  nursing  facilities,  other  facilities  offer  varying  levels  of care for 
Medicare  beneficiaries.  These  include  Medicaid  nursing,  board  and care,  assisted living, 
and retirement  facilities.  We have included all of these facilities in the scope of this 
inspection and refer to them collectivelyas nursing homes.  
Imaging services to nursing home residents 
Nursing  homes  frequently  provide  directly  or arrange  for ancillary  services--such  as x
rays--for  their  patients  who require  them.  Imaging  services  include  radiography  (x-ray), 
magnetic  resonance  imaging  (MRI),  computerized  axial tomography  (CAT scan), 
echography  (ultrasound),  and cardiac  catheterization.  For purposes  of this inspection, 
electrocardiographic  (ERG)  services  are included  as imaging  services. 
In some  instances,  firms  known as portable x-ray suppliers provide  x-rays  and ERGS to 
nursing  home  residents. 2  Medicares  portable  x-ray benefit  covers  skeletal  films  of the 
arms,  legs,  pelvis,  vertebral  column,  and skull  as well as chest and abdominal  films  that 
do not use contrast  media.  Medicare  also covers  EKGs under  the portable  benefit,  if they 
are medically  necessary  and are performed  by certified  portable  x-ray  suppliers.  All of 
these  services  must be diagnostic  rather  than therapeutic.  Portable  x-ray  suppliers  must 
meet HCFAs  conditions  of participation.  These conditions  require,  among  other  things, 
that  suppliers  comply  with  State and local  laws,  which  may provide  for the licensing  and 
regulation  of portable  suppliers. 
Billing for  imaging services 
Imaging  services  provided  to nursing  home patients  are billed  to the f=cal  intermediary  or 
the carrier  depending  on which  entity  provides  the service  and whether  there  is any 
financial  arrangement  between  the service provider  and a skilled  nursing  facility.  In all 
cases,  a physician  may  bill  the Part B carrier  for interpreting  an imaging  procedure.  For 
a full  discussion  of billing  options  and practices,  see the companion  report  Portable 
Imaging  Services:  A Costly  Option  (OEI-O9-9500090). 
OperationRestore Trust 
In May  1995, President  Clinton  and Health  and Human  Services  Secretary  Donna  Shalala 
announced  the kickoff  of Operation  Restore  Trust (ORT),  a new health  care anti-fraud 
 Other options  for musing  facilities  include providing  the service with their own equipment  or 
transportingpatientsto hospital  outpatient  departments,  imaging centers,  physician  offices,  or other  facilities.  initiative.  The ORT is a crackdown  on Medicare  and Medicaid  fraud,  waste,  and abuse  in 
home  health  agencies,  nursing  homes,  and durable  medical  equipment  suppliers.  The 
ORT focuses  on the five  states--California,  New York,  Florida,  Texas,  and Illinois--that 
account  for 40 percent  of the nations  Mdicare  beneficiaries  and program  expenditures. 
The  ORT includes  Federal  and State agencies  in collaboration  with the private  sector  and 
beneficiaries.  The federal  agencies  involved  include  the Office  of Inspector  General 
(OIG),  HCFA,  and the Administration  on Aging.  The OIG has undertaken  a number  of 
national  program  inspections  aimed  at identifying  and eliminating  systemic  weaknesses 
that allow  fraud,  waste,  and abuse to occur  in the areas of home  health,  nursing  homes, 
and durable  medical  equipment.  This  inspection  was conducted  as part of ORT. 
This  report  is the last in a series of three reports  prepared  by the OIG on imaging  services 
for nursing  home patients.  The first report,  Portable  Imaging  Services:  A Costly 
-Option (OEI-09-95-00090),  determined  how different  billing  practices,  financial 
arrangements,  and clinical  settings  affect  the cost of imaging  services  for the Medicare 
program  and its beneficiaries.  The  second report,  Portable  Imaging  Services:  Nursing 
Home  Perspectives  (OEI-O9-95-ooO91), determined  when,  how,  and why  nursing  homes 
use portable  imaging  services  for their  patients. 
METHODOLOGY 
Sample  Selection 
From  a 1 percent  Common  Working  File database,  we extracted  data on all beneficiaries 
who were  in a nursing  home  at any time during  1994.  We then  extracted  claims  data on 
all imaging  services  provided  to these beneficiaries. 
We identified  nursing  home  residents  through  a number  of indicators  in the claims  data. 
These  indicators  included  place  of service,  hospital  discharge  destination,  skilled  nursing 
claims,  and HCFA  Common  Procedure  Codii  System  (HCPCS)  codes that are likely  to 
correspond  to a nursing  home  resident  (such as transportation  of portable  x-ray 
equipment).  Based on a pre-test  of this approach,  we estimate  that our database  included 
more  than  95 percent  of all nursing  home  residents  who received  imaging  services.  From 
this database,  we selected  a stratified  sample:  Stratum 
All or part billed  ORT States  53 
by skilled nursing 
facility  Non-ORT  States  32 
Billed directly  by  ORT States  134 
supplier  or other 
service provider  Non-ORT  States  60 
ORT States  143 
EKGs (HCPCS=  93000 through  93010) 
Non-ORT  States  65 
ORT States  167 
CAT  scans and MRIs 
(numerous  HCPCS  codes)  Non-ORT  States  75 
When  there  was no skilled  nursing  facility  claim  that could be associated  with an imaging 
service,  we verified  that the beneficiary  was a nursing  home resident  by contacting 
physicians,  portable  suppliers,  and nursing  homes.  We excluded  beneficiaries  from  the 
sample  who did not reside  in skilled  nursing,  Medicaid  nursing,  board  and care,  assisted 
living,  or retirement  facilities  when the service  was rendered. 
Medical  Record  Request 
For  all claims,  we requested  medical  records  and original  x-rays,  EKGs,  MRIs,  and 

CAT  scans.  We requested  information  from  all entities  involved  in providing  the service. 

These  included  nursing  homes,  physicians,  hospitals,  portable  x-ray  suppliers,  and 

independent  laboratories.  We specifically  requested: 

  the physicians  order  for the procedure,  including  documentation  of the need for 
portable  x-ray  or EKG services  (if applicable); 
  the original  x-ray,  MRI or CAT scan film, or EKG; 
  the written  interpretation  of the procedure; 
  the patients  history;  and 
0  any other  progress  notes,  nurses  assessments,  and medication  records  for the week 
up to and including  the date of the procedure. 
Medical  Review  Screening  Instrument 
With  the assistance  of a medical  review  contractor,  we developed  screening  instruments 
based  on appropriateness  criteria  from  the American  College  of Radiology  and the 
American  College  of Cardiology:  We developed  separate screening  instruments  for 
each  imaging  procedure.  Only  those procedures  that failed  to meet the screening 
instrument  criteria  were sent to the medical  review  contractor  for further  analysis. 
4 
 In no instances  did OIG reviewers  determine  that a case was medically  unnecessary. 
Appendix  A contains  the screening  criteria  for chest x-rays  and EKGs. 
Medical  Review  Process 
The contractor  developed  its own medical  review  protocol.  Depending  on the result  of the 
OIG screening,  the type  of imaging  service,  and the setting  in which  it was provided, 
the review  included  (1) medical  necessity  and appropriateness,  (2) quality  of care, 
(3) assessment  of the need for portable  services,  and/or  (4) assessment  of chest x-ray 
fihn  quality. 
Initially,  this  inspection  included  MRIs and CAT  scans.  We discontinued  the medical 
review  of these procedures  after  the medical  review  contractor  determined  that,  based  on a 
sample  of cases,  almost  all of these services  were medically  necessary.  Continued 
medical  review  would have  been costly  and unproductive. 
. 
,  FINDINGS 

Of the $120 million that Medicare paid for  chest x-rays  during 1994, it paid  less than 
$I million for  medically  unnecessary  and undocumented  chest x-rays 
Chest  x-rays  are a routine  diagnostic  procedure  used by physicians  to rule out or diagnose 
numerous  conditions  in elderly  patients.  Physicians  can justify  ordering  a chest x-ray 
when  a nursing  home patient  has a respiratory  problem  that might  be considered  minor  for 
the general  population.  The results  of our medical  review  confirm  this.  As the following 
table  shows,  based on our projections,  almost  all chest x-rays  rendered  in  1994 were 
determined  to be medically  necessary: 
The High Percentage  of Medically  Necessary  Chest X-rays 
Illustrates  Its Acceptance  and Use as a Diagnostic  Tool 
Total  number  of chest  x-rays  in  1994  1,677,530 
Percent  Medically  Necessary  per Screening  Instrument  40.9 
Criteria 
Percent  Medically  Necessary  per Medical  Review  Contractor  57.8 
Percent  Medically  Unnecessary  1.0 
Percent  Inadequate  Documentation  0.4 
.* 
Approximately  41 percent  of chest x-rays  met the screening  instrument  criteria  for medical 
necessity.  In 58 percent  of cases,  information  in patients  medical  records  did not meet 
the basic  criteria,  but medical  reviewers  determined  that the services  were necessary  and 
appropriate.  In these cases,  beneficiaries  exhibited  different  or less severe symptoms  than 
those  that were determined  to be medically  necessary  via the screening  instrument.  The 
medical  reviewers  also determined  that beneficiaries  who received  multiple  chest x-rays  in 
a short  period  of time received  appropriate  services. 
Overall,  carriers  and our medical  review  contractor  agreed that chest x-rays  are 
appropriate  for diagnosing  numerous  conditions.  One carrier  manual  lists four pages of 
diagnoses  that would justify  the need for a chest x-ray.  The list includes  numerous 
cardiovascular  and respiratory  conditions  as well  as common  nursing  home patient 
problems  such as cancer,  stroke,  asthma,  diabetes,  difficulty  swallowing,  senile 
degeneration,  and weight  loss. 
6 
 The quality  of portable  chest x-ray  images is acceptable  in more than 90 percent  of cases 
Some critics  have  questioned  the quality  of portable  chest x-ray  images  because  of the 
difficulty  of positioning  bed-ridden  patients.  In our companion  reports  on portable 
imaging  services,  we noted  that using  a portable  supplier  for non-emergency  chest  x-rays 
and EKGs has become  routine  for sampled  nursing  homes.  Portable  suppliers  provide 
more  than  60 percent  of all chest x-rays  for nursing  home  patients. 
Film  quality  was acceptable  for almost  all portable  chest x-rays.  In most  of the cases 
where  the medical  reviewer  deemed  the quality  unacceptable,  the technician  had failed  to 
include  left and right  markers  on the image.  There  were almost  no cases where  the image 
was unreadable. 
In 1994, approximately  12 percent  of EKGs were medically  unnecessary,  and in more 
than 13 percent  of cases, documentation  was inadequate 
In  1994,  Medicare  paid almost  $32 million  for EKGs for nursing  home  patients.  This 
included  paying  $8.4  million  for  194,000  medically  unnecessary  or undocumented  EKGs. 
Medicare  paid  for these  services  because  EKGs are not a costly  procedure  and are a low 
priority  for medical  review.  The table below  summarizes  the medical  review  findings 
projected  nationally: 
EKGs Are Frequently  Questionable 
I

Total  number  of EKGs in  1994  3  772,836 
Percent  Medically  Necessary  per Screening  Instrument  24.2 
Criteria 
Percent  Medically  Necessary  per Medical  Review  Contractor  50.7 

Percent  Medically  Unnecessary  11.9 

Percent  Inadequate  Documentation  13.3 
In the medically  cases,  the medical  review  contractor  determined  that the 
u~ecessary 
. EKG served  no useful  diagnostic  purpose.  The table on the following  page  illustrates  a 
few typical  cases.  It shows that nursing  homes,  physicians,  and/or  suppliers  (1) falsify  or 
miscode  diagnosis  codes,  (2) do not have adequate  documentation  to support  providing  the 
service,  or (3) inappropriately  provide  EKGs.  Medical  Review  Shows the Nature  of Medically  Unnecessary  EKGs 
I
Patient  Diagnosis  on Claim  Medical ReviewFinding 
#l  Hyperlipidemia  EKG was done to evaluatehyperlipidemia. EKG 
is not a testfor hyperlipidemia. 
#2  Premature  Beats  Nothing in the medical record indicatesthat 
rhythmwas a problem. 
#3  Cardiac  Arrest  Patientwas deceased--EKG was a flatline. 
#4  Cerebrovascular  No reasonfor EKG.  Recentlydischargedfrom 
Accident  hospitalwhere EKG wasprobab& done. 
#5  Congestive  Heart  Medical record showsno rationalefor requesting 
Failure  an EKG. 
#6  Acute  Cystitis  No reasons listed in medical record for an EKG. 
Physicians  and portable  suppliers  who provide  more EKGs per  beneficiary  than other 
providers  are far  more likely  to provide  medically  unnecessary EKGs 
Physicians  or suppliers  who bill  for more  than four EKGs per beneficiary  per year 
comprise  a very  small proportion  of providers  in general,  but they  accounted  for 
approximately  9 percent  of all medically  unnecessary  and undocumented  EKGs in  1994. 
On average,  most physicians  and portable  suppliers  who provide  and interpret  EKGs do so 
for beneficiaries  who receive  one or two EKGs per year.  Some physicians  and portable 
suppliers,  however,  provide  or interpret  far more per beneficiary.  One supplier,  for 
example,  provided  an average  of 27 EXGs for  each of its beneficiaries in 1994.  While  bi
weekly  EKGs might  be appropriate  in special  instances,  this average  is extreme. 
One carrier  recouped  thousands  of dollars  that it had paid a physician  in our sample for 
ordering  and interpreting  routine  EKGs.  As a result of this inspection,  we referred  a 
physician  and a portable  supplier  to the Office  of Investigations. 
Portable  suppliers  are much more likely to be paid for  undocumented  EKGs than non-
portable  suppliers 
In  1994, more  than 28 percent  of portable  EKGs were not justified  in the medical  records, 
while  only  3 percent  performed  by non-portable  suppliers  lacked  appropriate 
documentation.  The rates of medically  unnecessary  EKGs were similar  for both portable 
and non-portable  suppliers.  Portable  suppliers  provided  more than  one-third  of EKGs for 
nursing  home  patients  in  1994. 
We found  no significant  difference  in the rates of medically  or undocumented 
u~ecessary 
EKGs between  the five  Operation  Restore  Trust  States and the rest of the country. 
8 
 The HCFA should  require  that Medicare  contractors  profile  high  volume 
EKG suppliers  and physicians  to determine  if they routinely  bill for medically 
unnecessary  and undocumented  EKGs 
Suppliers  and physicians  who provide  an average  of more  than  four  EKGs per beneficiary 
annually  are more  likely  to be providing  medically  unnecessary  or undocumented  services 
than  suppliers  and physicians  who provide  one or two EKGs per beneficiary.  Eliminating 
inappropriate  billing  by these providers  would  save Medicare  less than  $1 million 
annually,  but it would  reduce  or eliminate  payments  to providers  who routinely  bill  for 
medically  EKGs. 
u~ecessq 
AGENCY  COMMENTS 
We received  comments  on the draft  report  from  HCFA  and the Assistant  Secretary  for 
Planning  and Evaluation.  Both HCFA  and the Assistant  Secretary  for Planning  and 
Evaluation  concurred  with our recommendation  that Medicare  contractors  profile  high 
volume  EKG suppliers  and physicians.  In addition,  HCFA  noted  that  it has eliminated 
coverage  and payment  for EKGs under  the portable  x-ray  benefit  and now requires  that all 
Medicare  tests be ordered  by the patients  treating  physician. 
Both HCFA  and the Assistant  Secretary  for Planning  and Evaluation  commented  that the 
use of the term  nursing  facility  in the draft  report  was confusing.  In response,  we have 
revised  the report  to refer  to sampled  facilities  as nursing  homes.  These  include  skilled 
nursing,  Medicaid  nursing,  board  and care,  assisted  living,  or retirement  facilities.  Where 
appropriate,  we differentiate  between  skilled  nursing  facilities  and other  nursing  homes 
included  in the study. 
..  
The HCFA  commented  that our discussion  of the skilled  nursing  benefit  was too vague. 
Since  neither  of our findings  pertains  specifically  to skilled  nursing  facilities,  the purpose 
of describing  these facilities  in the background  was simply  to establish  that they  are 
defined  specifically  in the Medicare  law.  The companion  reports  Portable  Imaging 
Services:  A Costly  Option  (OEI-O9-9540090)  and  Portable  Imaging  Services:  Nursing 
Home  Perspectives  (OEI-O9-95-00091)  contain  a more  detailed  description  of the skilled 
nursing  benefit. 
See appendix  C for the full  text of the agencies  comments. 
9 
 APPENDIX  A 
OIG MEDICAL  REVIEW CRITERIA 
Diagnoses/symptoms  necessary  for OIG reviewer to deem 
CHEST X-RAYS medically  necessary: 
Cardiovascular  Pulmonary 
Angina  Bronchopneumonia 

Aortic  valve  disease  or injury 
 Cancer 

Arrhythmia 
 Cough  with hemorrhage 

Atria1 fibrillation 
 Emphysema 

Atria1 tachycardia 
 Lung abscess 

Cardiac  disease 
 Shortness  of breath 

Cardiovascular  system  symptoms 
 Tuberculosis 

Chest  pain 
 Upper respiratory  infection 

Heart  disease 

Ischemic  heart  disease 

Myocardial  infarction 

OTHER 
Cerebrovascular  accident 

Choking 

Coma 

Diabetes 

Fracture  of clavicle,  collarbone,  coronoid  process,  larynx,  rib,  scapula,  shoulder  blade, 
.a 
SttXllUlll 
Hernia 

Malignant  neoplasm  (any) 

Scoliosis 

Septicemia 

Stroke 

Syncope 

Other  criteria  that must be met in addition  to diagnoses/symptoms: 
b  Service  does not appear  to be a routine  preoperative  screen. 
b  Service  does not appear to be a follow-up,  performed  less than  14 days after 
another  chest x-ray. 
b 	 Service  is a follow-up,  less than  14 days after prior  chest x-ray,  but beneficiary  is 
on ventilator  or has congestive  heart  failure,  pneumonia,  or pulmonary  congestion, 
and beneficiary  is experiencing  new symptoms. 
A-l  Diagnoses/symptoms  necessary  for OIG reviewer to deem 
EKGs medically  necessary: 
Arrhythmia 

Angina 

Arteriosclerosis 

Atria1 fibrillation  or flutter 

Bradycardia 

Cerebrovascular  accident 

Complication  of pacemaker 

Congestive  heart  failure 

Coronary  artery  embolism,  sclerosis,  or rupture 

Heart  disease 

Myocardial  infarction 

Permanent  pacemaker 

Respiratory  failure 

Syncope 

Tachycardia 

Other  criteria  that must be met in addition  to diagnoses/symptoms: 
b  Service  was not a follow-up  EKG performed  less than  14 days after  another  EKG. 
b  Service  was a follow-up  EKG performed  less than  14 days  after  another  EKG,  but 
beneficiary  was experiencing  new symptoms. 
A-2 
 APPENDIX  B 
The  following  tables  show the point  estimates  and 95 percent  confidence  intervals  for 
selected  statistics  in the order  they  appear  in the report. 
statistic 
Point  estimate  95 percent 
confidence  interval 
Percent  of nursing  home  residents  1994 chest x-rays that were medically  unnecessary  or 
undocumented 
I-
1.3 percent  I  0.2 percent  - 2.5 percent 
Amount  Medicare  paid for chest x-rays provided  to nursing  home  residents  during  1994 
I---
$1 19,843,868  I  $98,572,561  - $141,115,174 
Amount  Medicare  paid for medically  unnecessary  or undocumented  chest x-rays provided  to 
nursing  home  residents  during  1994 
$957.736  $35,271 - $1,880,200 
Total  number  of chest x-rays provided  to nursing  home  residents  during  1994 
1,677,530  1,531,153 - 1,823,906 
Percent  of nursing  home  residents  1994 portable  chest x-rays that had an acceptable  quality 
image 
92.0 percent  85.6 percent  - 98.5 percent 
Percent  of nursing  home  residents  1994 chest x-rays that were portable 
61.6 percent  52.8 percent  - 70.4 percent 
Percent  of nursing  home  residents  1994 EKGs that were medically  unnecessary  or 
undocumented 
I  25.1 percent  16.5 percent  - 33.8 percent 
Percent  of nursing  home  residents  1994 EKGs that were medically  unnecessary
I  I 
I 
11.9 percent  5.7 percent  - 18.1 percent 
I 
Percent  of nursing  home  residents  1994 EKGs that were undocumented 
13.3 percent  6.6 percent  - 19.9 percent 
Amount  Medicare  paid for. EKGs provided  to nursing  home residents  during  1994 
I 
$3 1,764,242  $23,294,925  - $40,233,559 
B-l  statistic 

Point  estimate  95 percent 
confidence  interval 
Amount  Medicare  paid for medically  unnecessary  or undocumented  EKGs provided  to nursing 
home  residents  during  1994 
$8,362,146  $4,564,525  - $12,159,766 
Total number  of medically  unnecessary  or undocumented  EKGs provided  to nursing  home 
residents  during  1994 
194,234  127,246 - 261,221 
11Total number  of EKGs provided  to nursing  home  residents  during  1994  II 
II  651,801 - 893,871 
II Percent  of medically  unnecessary  or undocumented  EKGs that were provided  by physicians  and  II 
IsIup pliers  with an average  of 4 or more  EKGs per benefkkry  during  1994
I  I  II 
II  I  9.4 nercent  I  1.O uercent  - 17.9 percent  II 
II
Percent  of nortable  EKGs that were undocumented  II 
II 
28.2. percent  12.7 percent  - 43.6 percent 
II 
II
Percent  of non-sortable  EKGs that were undocumented  II 
3.3 percent  0.4 percent  - 6.2 percent 
Percent  of nursinrr home  residents  1994 EKGs that were nortable 
35.3 percent  25.1 percent  - 45.5 percent 
Percent  of EKGs provided  to nursing  home  residents  in ORT States in 1994 that were 
medically  unnecessary  or undocumented  .. 
26.6 percent  17.0 percent  - 36.2 percent 
Percent  of EKGs provided  to nursing  home  residents  in non-ORT  States in 1994 that were 
medically  unnecessary  or undocumented 
24.2 percent  11.5 percent  - 36.9 percent 
B-2 
 APPENDIX  C 
AGENCY COMMENTS 
Health Care Financing Administration 
Health Care 
DEPARTMENT OF HEALTH & HUMAN SERVICES  FinancingAUministration 
Memorandum 
JON27  I997 
DATE: 
TO:  Juae Gibbs Brown 
SUBJECT: 	 Office of Inspector General (OIG) Draft Report: ImagingServices for 
Nursing Home Patients: MedicaINecessity, (OEI-O9-95-00092) 
We reviewed the above-referenced report concerning the iuedical necessity of imaging 
services provided to residents of mrning facilities and paid by Medicare. 
Our detailed comments are attached for your consideration-Thank you for the 
opporhmity to review and comment on this report 
\ 
Attachment 
C-l  Health Care Financine AdministrationIHCFA) Comments on 
; ffi  or
  -
e  ervi  s for  ursitr 
J0EI-0!9-95-ooo92_1 
OIG Recommendation 

HCFA should require that Medicare con&actorsprofile high volume elecnocardiogram 

(EKG) suppliers and physicians to determine ifthey routinely bill for medically 

umeccssary and undocumented EKG& 

I 
fICPA Resuons 

Weconcur.  d  rccommendationappearsto0beasassumingtiMticare 

contractarsha~themedicalnviewandbadget~o~tocanryitoutinacost 

effective manna.  We believe that two recent mgulation changes implementedhy HCFA 

cd%ctiw January 1, will have the efiket of reducing the dimensionsof the problem of 

Medicare paying for medically unnecessary and undocmnentadEKG Setvices-espekKy 

for those furnished by portable x-ray suppliers. The first change invokd  the ehmination 

of coverage and payment for EKGs under the portable x-ray benefit  The second change 

was the catablishmentof the requirement that in order to be considered medically 

necessary all Medicare tests (imcludingEKG@must be ordered by the patients treating 

physician. Since these two improvements in the Medicare regulationshave only been in 

effect for a short period of time, it is too early to lmow how helpful they will be in 

reducing the problem OIG identified. However, we believe the long-nm impact of these 

recent HCFA actions will be very favorable. 

HCFAs goals are to ensure high quality health care, and to pay for services that are 

reasonable and medically mxisary.  HCFA has talcenappropriate steps to target 

vuhemble areas in the Medicare prugran~ Medicare contractors conduct focused 

medicalreview(I;uR)onrmongoingbasistoensurethatservicespaidforbyMedicare 

are reasonable and appropriate. Ihe FMR process allows contmetors to perform data 

analysistfiatallowsthem~identifyaberrantpa#ernsindatathatassistint;argetinghigh 

volume suppliers and physicians that are possibly bii  routinely for services that are 

medically uunecessiiry. The eontractors use system edi& internal medieal review 

gaidclines, or medical review policies to target and limit abusive behavior. Qrrently, 

approximately 46 Medicarecormdon  haveeditsinplacewithsetparametersrelatingto 

EKG services. 

Medicare eontractors are also curreutly using Provider Audit List&s  (PAL) that profile 

providers that have been flagged for submittingerroneous or inappropriateclaims on a 

eontimral basis. Claims submitted by these providers are automaticallysuspended in 

order to allow the contractor an opportunity to eonduct medical review and make a 

c-2  Page 2 

payment determination. Use of the PAL in conjunction with FMR have resulted in 

dramatic savingsto the Medicareprogram  As a result, our current data shows a 

4 percent increase in claim denials, 6 percent decrease in Medicare reimbmsement, 

6 percent~decreasein allowed charges, and a 7 percent decrease in allowed services. We 

believe the contractors have been very effective in using these mechanismsto ident@ 

Medicare dollars at risk, and target high vohune physicians and suppliers. 

Additional Comments 

The term nursing facility utilized throughoutthis report is misleading. Current Federal 

regulations d&ingukh between two types of long-term care (LTC) facilities: a nursing 

fkcilify @IF)under the Medicaidprogram and a skilled numingfacility (SNF) under the 

Medicare program. We suggestthat the tam LTC facility replace the words nursing 

fhility  throughout this report when refhing  to a generic musing home. If a policy or 

concern specifically relates to a Medicare SNP or a MedicaidNF, it should be so noted. 

The definition of the SNFbenefit that appears in the Backgroundis too general. We 

suggest that it be more specific. The SNF benefit is referred to as post-hospital extended 

care services. It is designed to assistpersons who have had a 3day qualifying hospital 

stay and require skilled services on adaily basis to recuperate from an acute episode. 

Coverage, if approved, is limited to a total of 100days per benefit period. On the 21st 

day the beneficiary becomes responsiblefor a daily coinsurance amount equal to one-

eighth of the inpatient hospital deductible, as prescribed by law. 

c-3  Assistant  Secretary for  Planning  and Evaluation 
DEPARTMENT  OF HEALTH & HUNAN  SERVICES 	 mceol*secmsv 
wn(ington. DC. zo201 
~19l997 
To:  June Gibbs Brown 
FROM:  David F Garrison 
OlG m  Rqxxt on Imaging Swiccs  for Nursing Home Residents 
coNcuRwITHcGMMENT  ffi/-L%qt5ooo9s7 
c-4