Department of Health and Human Services 

OFFICE OF 

INSPECTOR GENERAL 

QUESTIONABLE BILLING FOR 

MEDICARE OPHTHALMOLOGY 

SERVICES 

Suzanne Murrin 

Deputy Inspector General for 

Evaluation and Inspections 

September 2015 

OEI-04-12-00280 
 

 

 

 

EXECUTIVE SUMMARY: QUESTIONABLE BILLING FOR MEDICARE 

OPHTHALMOLOGY SERVICES 

OEI-04-12-00280 

WHY WE DID THIS STUDY 

In 2012, Medicare paid $6.7 billion to 44,960 providers for ophthalmology services that 

screen for, diagnose, evaluate, or treat two prominent eye conditions: wet age-related 

macular degeneration (wet AMD) and cataracts. Since 2010, the Office of Inspector 

General has investigated over 100 providers of ophthalmology services for fraud. We did 

this study to determine the extent to which ophthalmology services are vulnerable to 

fraud, waste, and/or abuse. 

HOW WE DID THIS STUDY 

We developed measures of questionable billing and used them to identify several 

different types of possible fraud, waste, and abuse. We examined approximately 

34 million paid claims for ophthalmology services from 2012. We identified providers 

with unusually high billing for procedures that screen for, diagnose, evaluate, or treat 

wet AMD or cataracts. For providers with questionable billing, we calculated the dollar 

amount that Medicare paid for services associated with these measures. We also 

identified the metropolitan areas in which providers with questionable billing were 

located and the medical specialties of providers billing for ophthalmology services. 

WHAT WE FOUND 

While most providers did not demonstrate questionable billing on any of our measures in 

2012, 4 percent of providers billing Medicare for ophthalmology services demonstrated at 

least one of our nine measures of questionable billing. Overall, Medicare paid these 

1,726 providers $768 million for ophthalmology services in 2012, of which $171 million 

was for services associated with the measures on which these providers demonstrated 

questionable billing. In seven metropolitan areas, the percentage of Medicare payments 

associated with our measures was at least twice as high as it was nationally. Medicare 

also paid $2 million for ophthalmology services to 821 providers that were not listed as 

eye care specialists in the Centers for Medicare & Medicaid Services’ (CMS) databases. 

WHAT WE RECOMMEND 

There may be legitimate reasons why some of the providers demonstrated questionable 

billing on the measures in this report. However, providers with questionable billing 

warrant further scrutiny. Therefore, we recommend that the CMS (1) increase 

monitoring of billing for ophthalmology services, including using measures of 

questionable billing similar to those used in this review and (2) review and take 

appropriate action regarding providers with questionable billing identified by this 

evaluation and conveyed by a separate memo. CMS concurred with both of our 

recommendations. 
TABLE OF CONTENTS 

Objectives ....................................................................................................1 

Background..................................................................................................1 

Methodology................................................................................................4 

Findings........................................................................................................6 

Four percent of providers billing for ophthalmology services in 

2012 demonstrated questionable billing on at least one of our 

measures; Medicare paid them $171 million for services related to 

these measures .................................................................................6 

In seven metropolitan areas, the percentage of Medicare payments 

associated with our measures of questionable billing was at least 

twice as high as it was nationally...................................................10 

Medicare paid $2 million for ophthalmology services to 

821 providers that were not listed as eye specialists in CMS 

databases ........................................................................................11
 

Conclusion and Recommendations ............................................................12 

Agency Comments and OIG Response..........................................14 

Appendixes ................................................................................................15 

A: Detailed Methodology .............................................................15 

B: Provider Enrollment Data and Claims Processing ...................22 

C: Number of Providers by Number of Measures of Questionable 

Billing for Which Providers Exceeded Thresholds, by Specialty 

Strata, 2012 ....................................................................................23 

D: Providers With Unusually High Billing by Each Measure of
 

Questionable Billing, 2012 ............................................................24 

E: Agency Comments ...................................................................28 

Acknowledgments......................................................................................31 
 

 

 

 

 

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OBJECTIVE 

To identify and describe providers with questionable billing for 

ophthalmology services in 2012. 

BACKGROUND 

Ophthalmology services are those in which providers screen for, diagnose, 

evaluate, or treat conditions associated with the eye. Medicare Part B 

covers such services provided by licensed specialists, including 

ophthalmologists and optometrists.1 Since 2010, the Office of Inspector 

General (OIG) has investigated over 100 providers of ophthalmology 

services for fraud. We did this study to determine the extent to which 

ophthalmology services are vulnerable to fraud, waste, and/or abuse. 

Medicare Requirements for Ophthalmology Services 

Medicare Part B covers ophthalmology services that are reasonable and 

necessary for the diagnosis or treatment of an individual’s condition.2 

Medicare uses a combination of national and local requirements to 

determine whether certain ophthalmology services are covered. National 

requirements are created at the Federal level and apply to all Medicare 

beneficiaries and claims processing contractors.3 In the absence of 

specific national requirements, claims processing contractors may create 

their own local coverage determinations (LCDs), which are contractor 

decisions about whether to cover particular services in their respective 

jurisdictions.4 

Medicare covers ophthalmology procedures for many eye conditions. 

However, the two eye conditions for which Medicare pays the most each 

year are wet age-related macular degeneration (wet AMD) and cataracts. 

In 2012, Medicare paid 44,960 providers $6.7 billion for ophthalmology 

services for these two conditions.5 

Wet AMD. Medicare paid $2.2 billion to providers in 2012 for services 

that screen, diagnose, evaluate, or treat wet AMD.6 This disease is the 

leading cause of severe vision loss in people over age 65 in the United 

States. 

1

 Social Security Act, § 1832(a)(1); the Centers for Medicare & Medicaid Services 

(CMS), Medicare Benefit Policy Manual, Pub. No. 100-02, ch. 15 § 30.4.
 2

 Social Security Act, § 1862(a)(1)(A).
 3

 Social Security Act, §§ 1862(a)(1)(A), 1862(l), 1869(f)(1)(B); CMS, Medicare National 

Coverage Determinations Manual, Pub. No. 100-03, Foreword. 4

 Social Security Act, §§ 1862(a)(1)(A), 1862(l), 1869(f)(2)(B); CMS, Medicare
 

Program Integrity Manual, Pub. No. 100-08, ch.13, § 13.1.3. 5

 OIG analysis of 2012 National Claims History (NCH) Part B file, 2014. 

6

 OIG analysis of 2012 NCH Part B file, 2014. 

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Medicare covers several services, including fluorescein angiographies, to 

diagnose or evaluate wet AMD, but Medicare does not have any national 

requirements that place specific limits on these services. However, some 

claims processing contractors have LCDs limiting the number of these 

diagnostic or evaluation services that a provider may bill per eye 

annually.7 

Additionally, Medicare covers several services to treat wet AMD, 

including laser surgery, biologic injections, and the administration of 

drugs. In limited circumstances, laser surgery can be the most appropriate 

treatment for wet AMD. In even fewer circumstances, physicians treat 

wet AMD with laser surgeries and concurrent biologic injections or drug 

administration.8 

One of the biologics most commonly used to treat wet AMD is Lucentis, 

for which Medicare paid an average of $2,013 per injection in 2012.9 

Medicare does not have a national requirement limiting the frequency at 

which a provider may bill for this injection; however, six claims 

processing contractors had LCDs in 2012 specifying that Lucentis 

injections are not covered more frequently than every 28 days per eye. To 

support the monthly limit on Lucentis injections, these LCDs cite the 

FDA-approved dosing guidelines on the biologic’s label. These guidelines 

state that injections should be administered between once every 28 days 

and once every 3 months.10 

Cataracts. Medicare paid $3.5 billion in 2012 for services that screen for, 

diagnose, evaluate, or treat cataracts, the leading cause of blindness in the 

world.11 A cataract is a clumping of protein in an eye’s lens that causes the 

lens to become cloudy. 

7

 For example, L27584 (retired) stated that fluorescein angiographies are considered 

medically necessary no more than nine times per eye annually, so claims that exceed this 

frequency will be suspended and reviewed for medical necessity. CMS, Local Coverage 

Determination (LCD) for Ophthalmic Angiography (Fluorescein and Indocyanine Green) 

(L27584), Palmetto GBA. Under these requirements, additional exams are denied as not 

reasonable and necessary unless the medical need for the additional exams is fully 

documented. 

8

 Kent, Christopher, “Macular Degeneration: Is Laser Still Relevant?”, Review of 

Ophthalmology, August 13, 2009. 9

 The Food and Drug Administration (FDA) approved Lucentis to treat wet AMD in
 

2006. 

10 FDA, Lucentis ® (ranibizumab injection) Intravitreal Injection, Initial US Approval: 

2006. US BLA (BL125156) Ranibizumab Injection. For example, CMS, Local 

Coverage Determination (LCD) for Ranibizumab (Lucentis)(L29266), First Coast Service 

Options, Inc, June 14, 2011. 

11 OIG analysis of 2012 NCH Part B file, 2014; National Institutes of Health, “Leading 

Causes of Blindness”, NIH Medline Plus. Volume 3, Number 3, Summer 2008. 

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Medicare covers several types of surgeries that treat cataracts by removing 

the cloudy, natural lens in an eye, and replacing it with a synthetic, 

crystalline lens. Medicare pays a higher rate for especially difficult 

cataract surgeries, which are called complex cataract surgeries. In 2012, 

Medicare paid an average of approximately $900 for each complex 

cataract surgery and $700 for each regular cataract surgery. 

Medicare Global Surgeries and Modifiers 

Most eye surgeries, including cataract removal surgeries, are categorized 

as “global” surgeries. A global surgery is a group of clinically related 

services that are coded and billed for as a single unit.12 This includes the 

surgical services—which are invasive procedures that only physicians 

with appropriate training should perform—and related preoperative and 

postoperative services to evaluate the beneficiary. Medicare pays for these 

services with a single payment—the global surgery fee. CMS bases global 

surgery fees on the cost of the surgery and the average number of related 

postoperative services required during the global surgery period.13 

Medicare will sometimes pay separately for preoperative and 

postoperative services that are normally covered under the global surgery 

fee. To do so, Medicare requires certain modifiers on claims. For 

example, modifiers 24 and 25 indicate that evaluation and management 

(E&M) services on claims submitted during the global surgery period are 

unrelated to the global surgery. Similarly, modifier 22 indicates that a 

global surgery is particularly complex and will require substantially more 

E&M services than are factored into the cost of the surgery.14 

Previous OIG Work 

OIG has found vulnerabilities in Medicare payments for ophthalmology 

services. For example, in 2009, OIG found that Medicare paid 

approximately $97.6 million in 2005 for E&M services that were included 

in global eye surgery fees but were not provided during the global eye 

surgery period.15 Also, a 2014 report found that Medicare paid $22 million 

12 CMS, Medicare Claims Processing Manual, Pub. No. 100-04, ch. 12 § 40; CMS 

Medicare Learning Network, Global Surgery Fact Sheet (March 2015). 13 Ibid. Global surgery periods are the lengths of time in which related services are 

covered under the global surgery fee, and they vary depending on the severity of the 

surgery. Global surgeries can be split into major surgeries, which have a 90-day global 

period, and minor surgeries, which have a global period of 10 days or fewer. 

14 CMS, Medicare Claims Processing Manual, Pub. No. 100-04, ch. 12 §§ 40.2.A.7, 

40.2.A.8, and 40.2.A.10.
 15 OIG, Nationwide Review of Evaluation and Management Services Included in Eye and
 

Ocular Adnexa Global Surgery Fees for Calendar Year 2005, A-05-07-00077, 

April 2009. 

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for ophthalmology claims that were potentially inappropriate based on 

national and local coverage requirements.16 

METHODOLOGY 

This evaluation is national in scope and is based primarily on paid 

Medicare Part B claims for 64 different Healthcare Common Procedure 

Coding System (HCPCS) codes for ophthalmology services.17 More 

specifically, our analysis examined approximately 34 million paid claims 

billed by 44,960 unique providers in 2012. Each Medicare-allowed 

amount is composed of the Medicare Part B responsibility (80 percent) 

and the beneficiary’s responsibility (20 percent).18 Throughout this report, 

when we refer to the dollar amount that Medicare “paid” for each service, 

we are referencing the Medicare-allowed amount for each service. 

For a detailed methodology and a full description of our measures of 

questionable billing for ophthalmology services, refer to Appendix A. 

Identification and Description of Providers With Questionable 

Billing for Ophthalmology Services 

We classified providers into four strata on the basis of the specialty code 

field on their Medicare claims: ophthalmology, optometry, ambulatory 

surgery, and all other specialties. We analyzed each specialty group 

separately because we observed differences in their billing patterns. We 

identified providers as those having unique national provider identifiers 

(NPIs). 

We developed nine measures of questionable billing for ophthalmology 

services to capture several different types of possible fraud, waste, and 

abuse. Our measures of questionable billing are grouped into four 

categories. These categories covered providers with unusually high billing 

for (1) procedures to treat wet AMD, (2) complex cataract surgeries, 

(3) tests to diagnose wet AMD, and (4) ophthalmology claims using 

modifiers. The FDA approved label for Lucentis was the basis for two 

measures of questionable billing, both of which were in the first 

category—unusually high billing for procedures to treat wet AMD. We 

developed the remaining seven measures on the basis of past OIG work 

and fraud investigations related to ophthalmology services, as well as 

input from staff at CMS and the American Academy of Ophthalmology. 

16 OIG, Medicare Paid $22 Million in 2012 for Potentially Inappropriate Ophthalmology
 

Claims, OEI-04-12-00281, December, 2014. 17 Medicare Part B services are classified and paid for using HCPCS codes.
 18 Medicare Part B also required a deductible of $99.90 per month in 2012.
 

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When analyzing each measure of questionable billing, we excluded claims 

processed by contractors that had any LCDs pertaining to the HCPCS 

code(s) covered by the measure. Although some of the billing from 

providers that demonstrated questionable billing on our measures may be 

legitimate, providers with questionable billing warrant further scrutiny. 

For each provider we identified, we calculated the dollar amount that 

Medicare paid for services associated with each measure on which the 

provider demonstrated questionable billing. To do so, we summed the 

amount that Medicare paid for all claims associated with the measure(s) 

for which the provider demonstrated questionable billing. This was not 

necessarily the total amount that Medicare paid the provider for 

ophthalmology services. For example, if a provider demonstrated 

questionable billing only for Lucentis injections, we summed all Lucentis 

injections billed by that provider. 

We also identified geographic areas that had high rates of Medicare 

payments associated with questionable billing for ophthalmology services 

in 2012. We also reviewed multiple data sources to identify providers 

with listed specialties that appeared unrelated to ophthalmology (i.e., 

specialties other than ophthalmology, optometry, or ambulatory surgery). 

Specifically, we reviewed the specialty code field from Medicare claims 

data; specialty information from the Provider Enrollment, Chain, and 

Ownership System (PECOS); and specialty information from the National 

Plan and Provider Enumeration System (NPPES).19 We report the extent 

to which providers with specialties thatappeared unrelated to 

ophthalmology billed for ophthalmology services. 

Limitations 

We did not conduct a medical record review for any claims associated 

with the services in this report to determine whether they were 

inappropriate or fraudulent. Some providers may have legitimate reasons 

for exceeding certain thresholds on our measures of questionable billing. 

For example, they may be highly specialized providers that offer unique or 

complex care for beneficiaries. 

Standards 

This study was conducted in accordance with the Quality Standards for 

Inspection and Evaluation issued by the Council of the Inspectors General 

on Integrity and Efficiency. 

19 To establish and maintain Medicare billing privileges, providers supply information 

about their specific attributes, including medical specialty and license information, to 

CMS through PECOS and NPPES. For more information about PECOS and NPPES, see 

Appendix B. 

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FINDINGS 

Four percent of providers billing for ophthalmology

services in 2012 demonstrated questionable billing on 

at least one of our measures; Medicare paid them 

$171 million for services related to these measures 

Of the 44,960 providers that billed Medicare for ophthalmology services 

in 2012, approximately 4 percent (1,726) exceeded the threshold for at 

least one of our nine measures of questionable billing.20 Overall, Medicare 

paid these 1,726 providers approximately $768 million for ophthalmology 

services in 2012. Of this $768 million, Medicare paid $171 million for 

services associated with the measures on which the providers 

demonstrated questionable billing.21 

Among the 1,726 providers with questionable billing, 96 percent (1,653) 

exceeded the threshold for just one measure of questionable billing, and 

approximately 4 percent (64) exceeded the threshold for two measures of 

questionable billing. Nine providers exceeded our thresholds for three, 

four, or five measures of questionable billing. Table 2 indicates the 

number and percentage of providers by the number of measures of 

questionable billing for which providers exceeded thresholds. Appendix C 

has the number and percentage of providers by the number of measures on 

which they demonstrated questionable billing within each specialty 

stratum. 

Table 2. Number and Percentage of Providers by Number of Measures of 

Questionable Billing for Which Providers Exceeded Thresholds, 2012 

Number of Measures of Questionable Billing for 

Which Providers Exceeded Thresholds 

Number of 

Providers 

Percentage of 

Providers 

1 1,653 95.8% 

2 64 3.7% 

3 7 0.4% 

4 1 <0.1% 

5 1 <0.1% 

6 or more 0 0% 

Total 1,726 100% 

Source: OIG analysis of 2012 NCH Part B file, 2014. 

20 Some claims were processed by contractors that had one or more LCDs in 2012 

pertaining to (a) tests that diagnose wet AMD or (b) Lucentis injections to treat wet 

AMD. We excluded claims for tests to diagnose wet AMD or Lucentis injections to treat 

wet AMD that were processed by contractors having such LCDs in 2012. The 

44,960 providers referenced in the text is the total number of providers that billed for at 

least one claim that we did not exclude. 

21 Throughout the findings, we will refer to this $171 million figure as the amount that 

Medicare paid for “services associated with our measures of questionable billing.” 

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For each measure of questionable billing, Table 3 shows the total number 

of providers that exceeded the threshold for unusually high billing and the 

total Medicare payments to those providers for services associated with 

each measure. Our nine measures of questionable billing are grouped into 

four categories. Appendix D shows the median, the threshold that 

indicated unusually high billing, the range of unusually high billing, the 

number of providers with unusually high billing, and the total amount 

Medicare paid these providers for services associated with each measure 

within each stratum. 

Table 3. Providers With Unusually High Billing by Category and Measure of Questionable Billing, 2012 

Category and Measure of Questionable Billing Number of Providers 

Exceeding Threshold* 

Amount Medicare Paid 

for Services Associated 

With Each Measure** 

Providers with unusually high billing for procedures to treat 

wet AMD 

261 $91 million 

- Lucentis injections more often than 28 days per 

eye 

209 $68 million 

- Lucentis injections beyond the maximum annual 

dosing recommendation per eye 

6 $22 million 

- Laser surgeries with concurrent biologic injections 

or drug administration 

50 $22 million 

Providers with unusually high billing for complex cataract 

surgeries

 580 $39 million 

Providers with unusually high billing for tests to diagnose 

wet AMD 

355 $23 million 

- More than three annual fundus photography exams 273 $12 million 

- More than five annual ophthalmoscopy exams 88 $8 million 

- More than five annual fluorescein angiographies or 

indocyanine green angiographies 

19 $3 million 

Providers with unusually high billing for ophthalmology 586 $18 million 

claims using modifiers 

- Modifier 24 or 25 566 $18 million

- Modifiers 22 20 $0.2 million

 Total 1,726 $171 million 

Source: OIG analysis of 2012 NCH Part B file, 2014. 

* Column does not sum to total because some providers were above the threshold on multiple measures of questionable billing. 

** Column does not sum to total due to rounding. 

Relatively few providers demonstrated questionable billing for 

procedures to treat wet AMD; however, over half of Medicare 

payments associated with questionable billing went to such 

providers for treating wet AMD 

Of the 1,726 providers demonstrating questionable billing on any of our 

measures in 2012, 261 (15 percent) did so on at least one of our three 

measures for procedures that treat wet AMD. Medicare paid these 

providers $91 million for procedures that treat wet AMD, including 

Lucentis injections and laser surgeries. These services represented the 

majority (53 percent) of Medicare payments associated with our measures 

of questionable billing. Some contractors have established limitations on 

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the frequency at which providers may bill for these procedures.22 In areas 

without these limitations, providers that bill for these procedures at 

unusually high levels may be billing for services that are not medically 

reasonable or necessary. 

Lucentis injections more often than 28 days per eye. In 2012, 

209 providers—almost all of whom were ophthalmologists (206)—billed 

for an unusually high percentage of Lucentis injections sooner than 

28 days after a prior injection on the same eye. Medicare paid these 

providers $68 million for Lucentis injections in 2012. 

The 206 ophthalmologists demonstrating questionable billing on this 

measure billed for more than 6 percent of their Lucentis injections within 

28 days of a prior injection on the same eye. One provider billed for 

56 percent of his Lucentis injections (121 of 216) less than one month 

after a prior injection on the same eye. In total, Medicare paid this 

provider $215,153 for Lucentis injections in 2012. This raises questions 

about the medical necessity of these injections. 

Lucentis injections beyond the maximum annual dosing recommendation 

per eye. Additionally, 6 providers—all ophthalmologists—billed for 

Lucentis injections beyond the maximum annual dosing recommendation 

per eye (i.e., more than 12 or 13 injections per eye per year) for an 

unusually high percentage of beneficiaries.23 Medicare paid these 

providers $22 million in 2012 for Lucentis injections. 

Overall, only 56 providers billed for more than the maximum annual 

dosing recommendation per eye for Lucentis injections in 2012. Of these 

providers, 6 billed for more than 12 or 13 Lucentis injections per eye for at 

least 9 percent of beneficiaries. One particular provider billed for Lucentis 

injections beyond the maximum recommended dosing amount for 12 of 

his 106 beneficiaries. This provider billed for an average of 19 injections 

for each of these 12 beneficiaries, including billing for 34 injections for 

1 beneficiary. Overall, Medicare paid this provider $2 million for 

Lucentis injections in 2012. This raises questions about whether all of 

these injections were medically reasonable and necessary. 

22 For our analysis of providers in areas where contractors have established LCDs 

limiting procedures that treat wet AMD, see our earlier report: Medicare Paid 

$22 Million in 2012 for Potentially Inappropriate Ophthalmology Claims, 

OEI-04-12-00281, December 2014. 23 The FDA-approved Lucentis label states that the biologic may be administered as often 

as every 28 days to treat wet AMD, for a total of 12 or 13 injections per eye per year, 

depending on when the first injection was administered, but that it can also be effective if 

injected as infrequently as once every 3 months. 

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Laser surgeries with concurrent biologic injections or drug 

administration. In 2012, 50 providers billed for laser surgery within 

28 days of biologic injections or drug administration for an unusually high 

percentage of beneficiaries. Medicare paid these providers $22 million for 

procedures to treat wet AMD in 2012. 

The vast majority of providers (3,137 of 3,612) that billed for procedures 

to treat wet AMD in 2012 did not bill for any laser surgeries within 

28 days of biologic injections or drug administration in 2012. However, 

1 provider billed for laser surgery within 28 days of Lucentis injections or 

drug administration for 80 percent of his beneficiaries (540 of 673). To 

treat these 540 beneficiaries’ wet AMD, this provider billed for 

6,748 Lucentis injections and 2,741 laser surgeries, representing 

$16 million. This figure includes 21 beneficiaries for whom this provider 

billed at least 24 Lucentis injections and 13 laser surgeries each. This 

raises questions about the medical necessity of these procedures. 

Five hundred eighty providers demonstrated questionable 

billing for complex cataract surgery, and Medicare paid these 

providers $39 million for this procedure 

Approximately one-third of the providers demonstrating questionable 

billing on any of our measures (580 of 1,726) did so for billing an 

unusually high percentage of their overall claims for cataract surgery as 

complex cataract surgery. Medicare paid these providers $39 million for 

complex cataract surgeries. For most providers, complex cataract surgery 

comprised less than 2 percent of their claims for cataract surgery. 

However, 1 provider billed for almost all of his cataract surgeries (356 of 

369) as complex. Medicare paid this provider over $430,000 for complex 

cataract surgeries in 2012. 

Providers with an unusually high percentage of complex cataract surgeries 

may have a legitimate reason, such as specializing in complex cases. 

However, providers also may be billing unnecessarily for the complex 

surgeries—rather than for standard ones—to increase their Medicare 

payments. Medicare paid an average of $200 more per complex cataract 

surgery than per regular cataract surgery in 2012 because complex cataract 

surgeries require more resources to perform. 

Approximately 900 providers demonstrated questionable 

billing for our remaining 5 measures, and Medicare paid these 

providers $41 million for services related to these measures 

Additionally, approximately 900 providers demonstrated questionable 

billing on our remaining 5 measures. Specifically, these measures include 

providers with unusually high billing for tests to diagnose wet AMD and 

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for ophthalmology claims using modifiers. Medicare paid these 900 

providers approximately $41 million in 2012 for exams to diagnose wet 

AMD and for ophthalmology claims with modifiers 22, 24, or 25. Please 

see Appendix D for details about questionable billing by measure and 

provider specialty. 

In seven metropolitan areas, the percentage of 

Medicare payments associated with our measures of 

questionable billing was at least twice as high as it 

was nationally 

Nationally, 2.6 percent of Medicare payments for ophthalmology services 

were associated with the measures on which providers demonstrated 

questionable billing ($171 million of $6.7 billion). These Medicare 

payments went to providers located in 340 metropolitan areas. However, 

in each of seven metropolitan areas, Medicare payments for services 

associated with our measures of questionable billing were an average of at 

least 7 percent of total Medicare payments for ophthalmology services. 

This is more than double the rate of Medicare payments for questionable 

billing nationally. See Table 4 for the percentage of Medicare payments 

for ophthalmology services associated with questionable billing by 

metropolitan area in 2012 and the number of providers demonstrating 

questionable billing in these areas. 

Table 4. Percentage of Medicare Payments Associated With Questionable Billing in Areas With High Rates of 

Questionable Billing, 2012

 Metropolitan Area 

Huntington, WV 

Vineland, NJ 

Salisbury, MD 

Miami, FL 

Grand Rapids, MI 

Fresno, CA 

Cincinnati, OH 

All Other Areas 

Total 

Percentage of Medicare 

Payments for Services 

Associated with 

Questionable Billing 

35.3% 

31.4% 

16.5% 

12.2% 

11.6% 

10.4% 

7.4% 

2.0% 

2.6% 

Medicare Payments 

Associated With 

Measures of 

Questionable Billing 

$4.2 million 

$5.0 million 

$2.9 million 

$21.2 million 

$3.4 million 

$2.2 million 

$2.0 million 

$129.9 million 

$171 million 

Total Medicare 

Payments for 

Ophthalmology 

Services 

$11.8 million 

$15.8 million 

$17.5 million 

$173.5 million 

$29.8 million 

$21.4 million 

$27.5 million 

$6.4 billion 

$6.7 billion 

Number of Providers 

Demonstrating 

Questionable Billing 

1 

4 

3 

52 

6 

4 

7 

1,649 

1,726 

Source: OIG analysis of 2012 NCH Part B file, 2014. 

Even though these seven metropolitan areas account for only 5 percent of 

all providers with questionable billing (78 of 1,726), the providers in these 

areas were responsible for nearly one quarter of all Medicare payments 

associated with questionable billing ($41 million of $171 million). Of this 

$41 million, most ($34 million) was for Lucentis injections. 

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Medicare paid $2 million for ophthalmology services 

to 821 providers that were not listed as eye specialists 

in CMS databases 

Of the 44,960 providers that billed Medicare for ophthalmology services 

in 2012, 2 percent (821) of providers were not listed as eye specialists 

(i.e., not ophthalmologists, optometrists, or ambulatory surgery centers) in 

the Medicare claims data; the Provider Enrollment, Chain, and Ownership 

System (PECOS); and the National Plan and Provider Enumeration 

System (NPPES).24 Medicare paid these 821 providers just over 

$2 million in 2012 for ophthalmology services, including $57,000 for 

major surgeries, which are the most invasive eye surgeries.25 Although the 

data sources we reviewed indicated that these providers were licensed and 

certified to practice medicine, these providers were not listed as eye care 

specialists.26 Ophthalmology services billed by these providers may be of 

poor quality or inappropriate if the providers were not properly trained to 

perform such services. 

In total, Medicare paid these providers for 24,069 ophthalmology claims. 

Two Medicare contractors processed 53 percent of these claims (12,688), 

though their share of all Medicare claims for ophthalmology services was 

less than 30 percent in 2012. 

Additionally, another 131 providers did not have specialty codes on their 

Medicare claims noting that they were eye specialists. However, their 

information in PECOS and/or NPPES noted that they were eye specialists. 

Therefore, the specialty codes on the Medicare claims differed from those 

in PECOS and/or NPPES for these providers.27 Differences in the 

specialty codes among these databases may indicate that these providers 

are not reporting and/or updating all specialty information. 

24 The provider specialty code on Medicare claims is automatically populated by PECOS 

data, but providers may have more than one specialty in PECOS. Additionally, upon 

enrollment, providers are required to submit identifying information, such as name and 

specialty, to NPPES. 

25 Major surgeries provide a 90-day global surgery period, the longest of any global 

surgery period in Medicare. 

26 Providers do not have to be listed as eye care specialists to perform eye procedures. 

For example, a provider could be listed as a general surgeon in PECOS while also
 

licensed and certified as an ophthalmologist. 

27 Contractors are required to verify providers’ information during enrollment and 

revalidation. See Appendix B for information on how providers enroll and revalidate in
 

Medicare using PECOS and NPPES. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 11 
 

 

CONCLUSION AND RECOMMENDATIONS 

In 2012, Medicare paid $6.7 billion to 44,960 providers for services that 

screened for, diagnosed, evaluated, and treated wet AMD or cataracts. 

Recent investigations and prior OIG work have found that these 

ophthalmology services are vulnerable to fraud, waste, and abuse. 

In 2012, approximately 4 percent of providers (1,726) demonstrated 

questionable billing on at least one of our nine measures. Medicare paid 

these providers $768 million for all ophthalmology services in 2012, of 

which $171 million was for services associated with the measures on 

which these providers demonstrated questionable billing. While there may 

be legitimate reasons for some of this billing, these providers warrant 

further scrutiny. Additionally, in seven metropolitan areas the percentage 

of Medicare payments associated with our measures of questionable 

billing was twice as high as it was nationally. 

Further, most providers billing for ophthalmology services, and those 

demonstrating questionable billing, were listed as eye specialists (i.e., 

ophthalmologists, optometrists, or ambulatory surgical centers) in CMS 

databases. However, Medicare paid $2 million for ophthalmology 

services to 821 providers that were not listed as eye specialists. 

We recommend that CMS: 

Increase monitoring of billing for ophthalmology services 

CMS should increase its monitoring of billing for ophthalmology services. 

CMS could use many different methods to increase its monitoring of these 

services; these methods include but are not limited to: 

	 Increasing its oversight of providers that demonstrated questionable 

billing on their use of Lucentis. Injections of Lucentis represent a 

substantial financial vulnerability if billed inappropriately or 

fraudulently. 

	 Instructing its contractors to use measures similar to those we 

incorporated into this study when monitoring billing for services that 

diagnose and treat wet AMD and cataracts. CMS could develop 

thresholds for these measures and instruct its contractors to conduct 

additional reviews of providers that exceed them. These contractors 

could also focus their efforts in the metropolitan areas with the highest 

percentages of questionable billing. 

	 Including the measures of questionable billing used in this report in its 

fraud-prevention system. 

	 Reviewing local policies (i.e., LCDs) regarding ophthalmology 

services used by its claims processing contractors. For those with 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 12 
 

 

 

specific criteria and uniform thresholds (e.g., in line with FDA label 

requirements), CMS could create national policies to align with these 

criteria. Additionally, CMS could instruct its claims processing 

contractors to review and consider implementing local policies used by 

other contractors to ensure that ophthalmology services are billed for 

appropriately. 

	 Reviewing payments for ophthalmology services that are inconsistent 

with providers’ reported specialties. 

Review providers with questionable billing for ophthalmology 

services identified by this evaluation and take appropriate 

action 

In a separate memorandum, we will refer to CMS the providers with 

questionable billing for ophthalmology services in 2012. We will also 

refer the providers that were not listed as eye specialists but that billed for 

major surgeries. CMS and/or its contractors should assess the claims from 

these providers and, if warranted, review medical records, review billing 

patterns, and/or perform unannounced site visits. After this assessment, 

CMS should determine and take an appropriate course of action. 

Appropriate actions may include, but are not limited to, (1) referring to 

law enforcement for criminal investigation, (2) suspending payments, 

(3) revoking Medicare privileges, (4) recouping overpayments, 

(5) educating providers on how to properly bill for ophthalmology services 

and report all specialties in which they may bill, or (6) taking no action. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 13 
 

 

 

AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL 

RESPONSE 

CMS concurred with both of our recommendations. 

CMS concurred with our recommendation to increase monitoring of 

billing for ophthalmology services. CMS stated that it will review the 

options that OIG included for how to implement this recommendation to 

determine which methods will be most effective. CMS further noted that 

it is committed to protecting the Medicare Trust Funds by combatting 

fraud, waste, and abuse. 

CMS also concurred with our recommendation to review providers with 

questionable billing for ophthalmology services identified by this 

evaluation and take appropriate action. CMS explained that it will 

conduct a preliminary analysis of the claims referred by OIG. CMS stated 

that on the basis of this analysis, it will determine an appropriate number 

of claims on which to conduct medical review and take appropriate action 

For the full text of CMS’s comments, see Appendix E. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 14 
 

 

 

 

____________________________________________________________ 

APPENDIX A 

Detailed Methodology 

Scope 

We analyzed paid Medicare Part B claims for 64 different HCPCS codes 

for ophthalmology services from the NCH File. This included 

approximately 34 million paid claims billed by 44,960 unique providers in 

2012. 

Identifying Providers With Questionable Billing for 

Ophthalmology Services 

To ensure that each provider’s billing was compared to the provider’s 

peers, we classified each provider into one of four strata on the basis of the 

provider’s specialty, as noted in the specialty code field on the provider’s 

Medicare claim: ophthalmology, optometry, ambulatory surgery, and all 

other specialties.28 We analyzed each specialty group separately. See 

Table A-1 for the total number of providers and dollar amount that 

Medicare paid for ophthalmology services in each of these four strata in 

2012. 

Table A-1. Number of Providers and Dollar Amount Medicare Paid for Ophthalmology Services 

by Specialty Strata, 2012 

Specialty Strata Number of Providers in Strata Dollar Amount That Medicare 

Paid Providers in Strata 

Ophthalmologists 17,270 $5.0 billion 

Optometrists 24,737 $0.4 billion 

Ambulatory Surgical Centers 2,001 $1.3 billion 

All Other Providers* 952 <$0.1 billion

 Total 44,960 $6.7 billion * There were 38 provider specialty types included in this specialty group. 

Source: OIG analysis of 2012 NCH Part B file, 2014. 

We developed nine measures of questionable billing for ophthalmology 

services to capture several different types of possible fraud, waste, and 

abuse. We grouped these nine measures of questionable billing into four 

categories. We developed two measures in the first category—unusually 

high billing for procedures to treat wet AMD—on the basis of the 

FDA-approved labelling for Lucentis. We developed the remaining seven 

measures on the basis of past OIG work and fraud investigations related to 

ophthalmology services, as well as input from staff at CMS and the 

28 Some providers had two specialty codes in their Medicare claims data. We classified 

these providers as eye specialists (i.e., ophthalmology, optometry, or ambulatory surgery) 

if one of their specialty codes indicated such a specialty. For providers with more than 

one specialty code not for eye specialists, we classified them according to the specialty 

code under which they billed for the greatest number of ophthalmology claims. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 15 
 

 

 

____________________________________________________________ 

 

 

 

 

American Academy of Ophthalmology. See Table A-2 for the measures of 

questionable billing. 

Table A-2: Measures of Questionable Billing 

Category Measure of Questionable Billing 

Providers with unusually high 

billing for procedures to treat 

wet AMD 

Lucentis injections more often than 28 days per eye* 

Lucentis injections beyond maximum annual dosing recommendation per eye* 

Laser surgeries with concurrent biologic injections or drug administration 

Providers with unusually high 

billing for complex cataract 

surgeries 

High percentage of claims for complex cataract surgery 

Providers with unusually high 

billing for tests to diagnose wet 

AMD 

High number of fundus photography exams per beneficiary annually* 

High number of ophthalmoscopy exams per beneficiary annually* 

High number of fluorescein angiographies or indocyanine green angiographies 

per beneficiary annually* 

Providers with unusually high 

billing for ophthalmology claims 

using modifiers 

High percentage of claims with modifiers 24 or 25 

High percentage of claims with modifier 22 

Source: OIG analysis of 2012 NCH Part B file, 2014. 

* Some contractors have LCDs establishing limitations on these services. In this report, we only applied this measure to providers with claims 

processing contractors not having such LCDs. We included a comparable analysis for providers with claims processing contractors having LCDs that 

established limitations on these services in a companion report, Medicare Paid $22 Million in 2012 for Potentially Inappropriate Ophthalmology Claims, 

OEI-04-12-00281, December 2014. 

When analyzing each measure, we excluded claims submitted to claims 

processing contractors that had an LCD pertaining to the HCPCS codes 

related to the measure. We also excluded providers that did not bill at 

least one claim with the HCPCS code or modifier related to the measure. 

Further, for each measure of questionable billing, we report only providers 

for which Medicare paid at least five ophthalmology claims associated 

with the measure in 2012. 

Using the Tukey method, we considered a provider’s billing to be 

unusually high, or questionable, on any of the nine measures if it was 

greater than the 75th percentile plus 1.5 times the interquartile range.29 

However, for some measures of questionable billing, our use of this 

methodology resulted in an outlier threshold that was the same as the 

higher bound of the interquartile range. For these measures of 

questionable billing, as noted below, we performed a “serial Tukey.” That 

is, we performed the Tukey method again on only those providers that 

exceeded the first outlier threshold. 

Additionally, we calculated the dollar amount that Medicare paid each 

provider for services associated with the measures on which they 

demonstrated questionable billing. To do so, we summed the amount that 

Medicare paid for all claims having HCPCS codes and/or modifiers 

29 This is a standard exploratory method for identifying members of a population with 

unusually high values on a given statistic compared to the rest of the population when no 

established benchmarks exist. See J.W. Tukey, Exploratory Data Analysis, 

Addison-Wesley, 1977. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 16 
 

 

related to the measure(s) on which these providers demonstrated 

questionable billing. For example, if a provider demonstrated 

questionable billing only for Lucentis injections, then we summed all 

claims for Lucentis injections billed by that provider. However, for this 

calculation we did not sum the amount that Medicare paid the provider for 

any other ophthalmology services. 

Below are the four categories of questionable billing, including their 

associated nine measures. 

A.	 Providers with unusually high billing for procedures to treat wet AMD. 

We reviewed claims for certain procedures that treat wet AMD to analyze 

three measures of questionable billing. These are: 

1. Lucentis injections more often than 28 days per eye. This measure 

represents the percentage—out of all Lucentis injections for the 

provider billed—of Lucentis injections that a provider billed less than 

28 days after a prior injection on the same eye. 

Providers billing for an unusually high percentage of Lucentis 

injections sooner than 28 days after another injection on the same eye 

may be overutilizing Lucentis and/or billing Medicare for unused 

Lucentis. According to the FDA-approved dosing guidelines on 

Lucentis’s label, the most frequently one eye should receive an 

injection is every 28 days. However, the dosing guidelines also 

indicate that Lucentis remains effective if dosed as infrequently as 

every 3 months per eye. 

2. Lucentis injections beyond the maximum annual dosing 

recommendation per eye. This measure represents the percentage— 

out of all beneficiaries for whom the provider billed for Lucentis 

injections—of beneficiaries for whom a provider billed for Lucentis 

injections beyond the maximum annual dosing recommendations per 

eye. We performed a serial Tukey to identify outliers on this measure. 

Providers exhibiting this measure may be overutilizing Lucentis and/or 

billing Medicare for unused Lucentis. Medicare paid an average of 

$2,000 for each dose of the biologic, which is injected directly into the 

eye. According to the FDA-approved dosing guidelines on Lucentis’s 

label, an eye should receive a maximum of 12 or 13 injections per year 

(depending on when the first injection occurs). However, the dosing 

guidelines also indicate that Lucentis remains effective if dosed as 

infrequently as every 3 months per eye. 

3. Laser surgeries with concurrent biologic injections or drug 

administration. This measure represents the percentage—out of all 

beneficiaries for whom the provider billed for procedures to treat wet 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 17 
 

 

 

 

AMD—of beneficiaries for whom a provider billed for laser surgeries 

to treat wet AMD within 28 days of Lucentis injections or drug 

administration to treat wet AMD on the same eye. We performed a 

serial Tukey to identify outliers on this measure. 

Laser surgery is appropriate to treat wet AMD in only limited 

circumstances, and most physicians do not treat wet AMD with 

concurrent laser surgery and biologic injections or drug administration. 

Specifically, providers may be billing Medicare for financial gain or 

potentially harming their patients if they bill for and/or provide laser 

surgeries with biologic injections or drug administration to treat wet 

AMD. 

B.	 Providers with unusually high billing for complex cataract surgeries. This 

category has only one measure of questionable billing, which is: 

4.	 High percentage of claims for complex cataract surgeries. This 

measure represents the percentage of each providers’ overall claims for 

cataract surgery claims that were for complex cataract surgery. 

Medicare pays providers a higher rate for complex cataract surgeries 

than for standard cataract surgeries. Providers with an unusually high 

percentage of claims for complex cataract surgery may be billing for 

services that are not medically reasonable or necessary. 

C.	 Providers with unusually high billing for tests to diagnose wet AMD. 

Billing for an unusually high number of tests per eye for an unusually high 

percentage of beneficiaries may indicate that providers are billing for 

services that are not medically reasonable or necessary. Additionally, 

these diagnostic exams cause blurred vision, which forces patients to 

require temporary care, and can harm beneficiaries if the tests are not 

needed. We reviewed claims for three types of tests that diagnose wet 

AMD. These three types of tests are the basis of our three measures of 

questionable billing, which are: 

5.	 High number of fundus photography exams per beneficiary annually. 

Providers billing for an unusually high number of fundus photography 

exams for an unusually high percentage of beneficiaries may be billing 

for services that are not medically reasonable and necessary. Overall, 

approximately 2 million beneficiaries had fundus photography exams 

in 2012. We identified the total number of these exams that each 

provider billed for each beneficiary. 

Some contractors have LCDs that establish limits on the number of 

annual fundus photography exams that are appropriate for providers 

within their jurisdiction, and these limits vary across LCDs. 

Therefore, for providers in our analysis (i.e., those in jurisdictions 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 18 
 

 

 

 

without LCDs), we used the Tukey methodology to determine a 

threshold for an unusually high number of exams per eye annually. 

The resulting threshold was two exams per eye, annually. 

We then used the Tukey methodology to identify providers that billed 

for more than three fundus photography exams per eye annually on an 

unusually high percentage of their beneficiaries receiving these exams 

in 2012. We performed a serial Tukey to identify outliers on this 

measure. 

6.	 High number of ophthalmoscopy exams per beneficiary annually. 

Providers billing for an unusually high number of ophthalmoscopy 

exams for an unusually high percentage of beneficiaries may be billing 

for services that are not medically reasonable and necessary. Overall, 

approximately 800,000 beneficiaries had ophthalmoscopy exams in 

2012. We identified the total number of these exams that each 

provider billed for each beneficiary. 

Some contractors have LCDs that establish limits on the number of 

annual ophthalmoscopy exams that are appropriate for providers 

within their jurisdiction, and these limits vary across LCDs. 

Therefore, for providers in our analysis (i.e., those in jurisdictions 

without LCDs), we used the Tukey methodology to determine a 

threshold for an unusually high number of exams per eye annually. 

The resulting threshold was five exams per eye, annually. 

We then used the Tukey methodology to identify providers that billed 

for more than five ophthalmoscopy exams per eye annually on an 

unusually high percentage of their beneficiaries receiving these exams 

in 2012. We performed a serial Tukey to identify outliers on this 

measure. 

7.	 High number of fluorescein angiographies or indocyanine green 

angiographies per beneficiary annually. Providers billing for an 

unusually high number of fluorescein angiographies or indocyanine 

green angiographies for an unusually high percentage of beneficiaries 

may be billing for services that are not medically reasonable and 

necessary. Overall, approximately 350,000 beneficiaries had 

fluorescein angiographies or indocyanine green angiographies in 2012. 

We identified the total number of these exams that each provider billed 

for each beneficiary. 

Some contractors have LCDs that establish limits on the number of 

annual fluorescein angiographies or indocyanine green angiographies 

that are appropriate for providers within their jurisdiction, and these 

limits vary across LCDs. Therefore, for providers in our analysis (i.e., 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 19 
 

 

____________________________________________________________ 

those in jurisdictions without LCDs), we used the Tukey methodology 

to determine a threshold for an unusually high number of exams per 

eye annually. The resulting threshold was five exams per eye, 

annually. 

We then used the Tukey methodology to identify providers that billed 

for more than five fluorescein angiographies or indocyanine green 

angiographies per eye annually on an unusually high percentage of 

their beneficiaries receiving these exams in 2012. We performed a 

serial Tukey to identify outliers on this measure. 

D.	 Providers with unusually high billing for ophthalmology claims using 

modifiers. Past OIG work has found that some providers inappropriately 

used modifiers to increase Medicare payments.30 We reviewed claims for 

the presence of modifiers that cause Medicare to cover E&M services that 

it otherwise would not. This category has two measures of questionable 

billing. These are: 

8.	 High percentage of claims with modifiers 24 or 25. This measure 

represents the percentage of each provider’s claims that contained 

modifiers 24 or 25. These modifiers indicate that E&M services 

provided during global surgery periods are separately payable because 

they are not related to the concurrent global surgery. However, 

providers that submit an unusually high percentage of claims with 

modifiers 24 or 25 may be using the modifiers to inappropriately 

receive payment for these services. 

9.	 High percentage of claims with modifier 22. This measure represents 

the percentage of each provider’s claims that contained modifier 22. 

This modifier causes Medicare to separately pay for E&M visits 

provided during global surgery periods because beneficiaries had 

particularly complicated surgeries that would require additional E&M 

visits beyond what is covered in the global surgery period. Providers 

that submit an unusually high percentage of claims with this modifier 

may be using it to inappropriately receive payment for E&M services. 

Describing Providers With Questionable Billing for 

Ophthalmology Services 
 

To describe providers with questionable billing for ophthalmology 

services, we analyzed the geographic locations of the questionable billing 

providers. 

We identified each provider’s Core Base Statistical Area (CBSA) by using 

the zip code listed on the provider’s ophthalmology claims. A CBSA is a 

30 For example, see OIG, Use of Modifier 25, OEI-07-03-00470. November 2005. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 20 
 

 

 

 

 

region around an urban center that has at least 10,000 people. For each 

CBSA, we determined the total dollar amount that Medicare paid to 

providers that demonstrated questionable billing for services associated 

with our measures of questionable billing. We also determined, for each 

CBSA, the dollar amount that Medicare paid in total for ophthalmology 

services. In the body of the report, we refer to CBSAs as “metropolitan 

areas.” 

After identifying the dollar amount Medicare paid for services associated 

with the measures on which providers demonstrated questionable billing, 

we identified CBSAs with high rates of Medicare payments for services 

associated with our measures of questionable billing out of total Medicare 

payments for ophthalmology services in 2012. We limited our analysis to 

only CBSAs with at least three providers billing for a total of at least 

$2 million for ophthalmology services in 2012. In the findings, we report 

CBSAs with percentages of Medicare payments for services associated 

with our measures of questionable billing that were at least twice the 

national average (2.6 percent). We also determined the measures of 

questionable billing exhibited by providers in these CBSAs. 

Analyzing the Specialty Information of Providers Billing for 

Ophthalmology Services 

We identified each provider’s medical specialty based on the specialty 

code listed on the provider’s ophthalmology claims. This information is 

supplied directly by the PECOS database for each provider. We then 

determined, by specialty, the total amount that Medicare paid for all 

ophthalmology services in 2012. We identified providers that had 

specialty codes indicating that they were not eye specialists (i.e., not 

ophthalmologists, optometrists, or ambulatory surgical centers). 

Subsequently, we compared these providers’ specialty codes on their 

Medicare claims with specialty information from PECOS and NPPES to 

identify those that were not listed as eye specialists in any data source. We 

also determined which claims processing contractors processed claims for 

these providers. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 21 
 

 

 

 

 

 

____________________________________________________________ 

 

 

APPENDIX B 

Provider Enrollment Data and Claims Processing 

Before enrolling in Medicare, providers must first obtain a National 

Provider Identifier (NPI) through NPPES.31 To do so, providers are 

required to submit identifying information to NPPES, such as name, 

professional license number, specialty type, and practice location. 

Claims processing contractors then enroll providers in Medicare using 

PECOS. Providers submit an enrollment application that claims 

processing contractors review, validate, and submit into PECOS. This 

application includes provider license or certification information, specialty 

type, practice address location, and other identifying information.32 

Once providers are enrolled, CMS and its contractors oversee the 

providers by using the information in PECOS. Providers must report any 

changes in their information to claims processing contractors within 

90 days.33 Claims processing contractors may deactivate the billing 

privileges of providers that do not maintain accurate enrollment 

information.34 Additionally, providers must revalidate their enrollment 

information every 5 years by resubmitting enrollment applications and 

supporting documentation to claims processing contractors for review and 

validation.35 

Contractors use data from PECOS to process and pay Medicare claims. 

For example, providers’ specialty types and practice addresses on 

Medicare claims come directly from PECOS. 

31 42 CFR § 424.506(b); CMS Medicare Program Integrity Manual, Pub. No. 100-08, 

ch. 15, § 15.3.
 32 CGI Federal, PECOS 6.0.0 Required Fields, Doc ID: PECOS-6.0.0-REQ-67792-

v0.10, April 2009. Providers must list a primary specialty when enrolling in Medicare 

using PECOS. Providers have the option of reporting a secondary specialty in PECOS,
 

but they cannot list any other specialties on the same enrollment application. 

33 42 CFR § 424.516(d)(2). 

34 42 CFR § 424.540(a)(2); CMS, Medicare Program Integrity Manual, Pub. No. 100-08, 

ch. 15, § 15.27.1.
 35 42 CFR § 424.515. Ambulances and suppliers of durable medical equipment have 

different timeframes for revalidation. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 22 
 

 

 

APPENDIX C 

Providers That Exceeded Thresholds for Questionable Billing, by Specialty 

Strata and Number of Measures, 2012 

Specialty Strata 

Ophthalmologists 

Optometrists 

Ambulatory Surgical 

Centers 

Other Provider 

Specialties 

Number of Measures for Which 

Providers Exceeded Thresholds of 

Questionable Billing 

1 

2 

3 

4 

5 

6 or more 

Total 

1 

2 

3 or more 

Total 

1 

2 

3 or more 

Total 

1 

2 or more 

Total 

Number of Providers 

1,120 

60 

7 

1 

1 

0 

1,189 

423 

2 

0 

425 

98 

2 

0 

100 

12 

0 

12 

Source: OIG analysis of 2012 NCH Part B file, 2014. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 23 
 

 

 

 

 

 

 

APPENDIX D 

Providers With Unusually High Billing by Each Measure of Questionable 

Billing, 2012 

Table D-1. Ophthalmologists With Unusually High Billing by Each Measure of 

Questionable Billing, 2012 

Measure of Questionable Billing 

Number of 

Providers 

Lower and 

Upper 

Quartiles* 

Providers with Unusually High Billing 

Threshold Range 

Medicare 

Payments for 

Services 

Associated With 

Each Measure** 

Number of 

Providers 

Exceeding 

Threshold*** 

Providers with unusually high billing for 

procedures to treat wet AMD 

- Lucentis injections more often than 28 

days per eye 

- Lucentis injections beyond the 

maximum annual dosing 

recommendation per eye† 

- Laser surgeries with concurrent 

biologic injections or drug 

administration† 

2,186 

2,186 

3,361 

0.0% to 2.5% 

0.0% to 0.0% 

0.0% to 0.0% 

6.3% 

8.5% 

6.8% 

6.3% to 56.0% 

9.1% to 11.8% 

7.1% to 80.2% 

$90 million 

$68 million 

$22 million 

$22 million 

249 

206 

6 

41 

Providers with unusually high billing for 

complex cataract surgeries 

11,327 1.5% to 15.4% 36.3% 36.4% to 100% $24 million 460 

Providers with unusually high billing for 

procedures to treat wet AMD 

- More than three annual fundus 

photography exams† 

- More than five annual 

ophthalmoscopy exams† 

- More than five annual fluorescein 

angiographies or indocyanine green 

angiographies† 

10,393 

7,436 

4,366 

0.0% to 0.0% 

0.0% to 0.0% 

0.0% to 0.0% 

10.2% 

19.5% 

16.3% 

10.3% to 57.1% 

19.5% to 59.4%

16.7% to 50.0%

$23 million 

$11 million 

 $8 million 

 $3 million 

271 

201 

76 

19 

Providers with unusually high billing for 

ophthalmology claims using modifiers 

- Modifiers 24 or 25 

- Modifier 22 

13,898 

241 

0.8% to 11.1% 

<0.1% to 0.2% 

41.9% 

0.8% 

41.9% to 100% 

0.8% to 4.9% 

$12 million 

$12 million 

 $0.2 million

261 

242 

19 

 Total** $150 million 1,189 

* The lower quartile is the value for the 25th percentile; the upper quartile is the value for the 75th percentile, and their difference is the interquartile range. 

** Column may not sum to total because of rounding. 

*** Sum of column exceeds total because some providers were above the threshold on multiple measures of questionable billing.
 

† For this measure, we performed a serial Tukey to identify outliers. For more information, see Appendix A. 

Source: OIG analysis of 2012 NCH Part B file, 2014. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 24 
 

 

 

 

APPENDIX D (CONTINUED) 

Providers With Unusually High Billing by Each Measure of Questionable 

Billing, 2012 

Table D-2. Optometrists With Unusually High Billing by Each Measure of 

Questionable Billing, 2012 

Measure of Questionable Billing 

Number of 

Providers 

Lower and 

Upper 

Quartiles* 

Providers with Unusually High Billing 

Threshold Range 

Medicare 

Payments for 

Services 

Associated With 

Each Measure** 

Number of 

Providers 

Exceeding 

Threshold*** 

Providers with unusually high billing for 

procedures to treat wet AMD 

- Lucentis injections more often than 28 

days per eye 

- Lucentis injections beyond the 

maximum annual dosing 

recommendation per eye 

- Laser surgeries with concurrent biologic 

injections or drug administration 

4 

4 

8 

0.0% to 0.0% 

0.0% to 0.0% 

0.0% to 0.0% 

0.0% 

0.0% 

0.0% 

0.0%

0.0%

0.0%

$0 

$0 

$0 

$0

0 

0 

0 

0 

Providers with unusually high billing for 

complex cataract surgeries 

12,439 0.0% to 0.0% 40.9% 41.7% to 100% <$0.1 million 26 

Providers with unusually high billing for 

tests to diagnose wet AMD 

- More than three annual fundus 

photography exams† 

- More than five annual ophthalmoscopy 

exams† 

- More than five annual fluorescein 

angiographies or indocyanine green 

angiographies 

15,675 

4,637 

124 

0.0% to 0.0% 

0.0% to 0.0% 

0.0% to 0.0% 

8.2% 

5.3% 

0.0% 

8.3% to 53.7%

6.3% to 30% 

0.0%

$1 million 

 $0.6 million 

<$0.1 million 

$0 

76 

64 

12 

0 

Providers with unusually high billing for 

ophthalmology claims using modifiers 

- Modifiers 24 or 25 

- Modifier 22 

7,029 

14 

0.8% to 11.1% 

0.2% to 1.4% 

42.0% 

4.7% 

42.1% to 90.9% 

9.8% to 9.8% 

$5 million 

 $5 million 

<$0.1 million 

325 

324 

1 

 Total** $6 million 425 

* The lower quartile is the value for the 25th percentile; the upper quartile is the value for the 75th percentile, and their difference is the interquartile range. 

** Column may not sum to total because of rounding. 

*** Sum of column exceeds total because some providers were above the threshold on multiple measures of questionable billing.
 

† For this measure, we performed a serial Tukey to identify outliers. For more information, see Appendix A. 

Source: OIG analysis of 2012 NCH Part B file, 2014. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 25 
 

 

 

 

APPENDIX D (CONTINUED) 

Providers With Unusually High Billing by Each Measure of Questionable 

Billing, 2012 

Table D-3. Ambulatory Surgical Centers With Unusually High Billing by Each 

Measure of Questionable Billing, 2012 

Measure of Questionable Billing 

Number of 

Providers 

Lower and 

Upper 

Quartiles* 

Providers with Unusually High Billing 

Threshold Range 

Medicare 

Payments for 

Services 

Associated With 

Each Measure** 

Number of 

Providers 

Exceeding 

Threshold*** 

Providers with unusually high billing for 

procedures to treat wet AMD 

- Lucentis injections more often than 28 

days per eye 

- Lucentis injections beyond the 

maximum annual dosing 

recommendation per eye 

- Laser surgeries with concurrent 

biologic injections or drug 

administration† 

31 

31 

235 

0.0% to 2.1% 

0.0% to 0.0% 

0.0% to 0.0% 

5.3% 

0.0% 

15.0% 

5.8% to 10.6%

0.0%

16.7% to 46.7% 

$1 million 

 $0.5 million 

$0 

<$0.1 million 

12 

3 

0 

9 

Providers with unusually high billing for 

complex cataract surgeries 

1,968 1.7% to 9.8% 21.9% 22.0% to 86.3% $14 million 90 

Providers with unusually high billing for 

tests to diagnose wet AMD 

- More than three annual fundus 

photography exams 

- More than five annual 

ophthalmoscopy exams 

- More than five annual fluorescein 

angiographies or indocyanine green 

angiographies 

0 

0 

0 

0.0% 

0.0% 

0.0% 

0.0% 

0.0% 

0.0% 

0.0%

0.0%

0.0%

$0 

$0 

$0 

$0 

0 

0 

0 

0 

Providers with unusually high billing for 

ophthalmology claims using modifiers 

- Modifiers 24 or 25 

- Modifier 22 

0 

11 

0.0% 

<0.1% to 0.8% 

0.0% 

3.0% 

0.0%

0.0%

$0 

$0 

$0 

0 

0 

0 

 Total** $15 million 100 

* The lower quartile is the value for the 25th percentile; the upper quartile is the value for the 75th percentile, and their difference is the interquartile range. 

** Column may not sum to total because of rounding. 

*** Sum of column exceeds total because some providers were above the threshold on multiple measures of questionable billing.
 

† For this measure, we performed a serial Tukey to identify outliers. For more information, see Appendix A. 

Source: OIG analysis of 2012 NCH Part B file, 2014. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 26 
 

 

 

 

 

APPENDIX D (CONTINUED) 

Providers With Unusually High Billing by Each Measure of Questionable 

Billing, 2012 

Table D-4. Providers in Other Specialties With Unusually High Billing by Each 

Measure of Questionable Billing, 2012 

Measure of Questionable Billing 

Number of 

Providers 

Lower and 

Upper 

Quartiles* 

Providers with Unusually High Billing 

Threshold Range 

Medicare 

Payments for 

Services 

Associated With 

Each Measure** 

Number of 

Providers 

Exceeding 

Threshold 

Providers with unusually high billing for 

procedures to treat wet AMD 

- Lucentis injections more often than 28 

days per eye 

- Lucentis injections beyond the 

maximum annual dosing 

recommendation per eye 

- Laser surgeries with concurrent 

biologic injections or drug 

administration 

4 

4 

8 

0.0% to 3.2% 

0.0% to 0.0% 

0.0% to 0.0% 

7.0% 

0.0% 

0.0% 

0.0%

0.0%

0.0%

$0 

$0 

$0 

$0 

0 

0 

0 

0 

Providers with unusually high billing for 

complex cataract surgeries 

58 0.0% to 0.0% 25.0% 26.9% to 80.0% $0.1 million 4 

Providers with unusually high billing for 

tests to diagnose wet AMD 

- More than three annual fundus 

photography exams† 

- More than five annual 

ophthalmoscopy exams 

- More than five annual fluorescein 

angiographies or indocyanine green 

angiographies 

165 

51 

23 

0.0% to 0.0% 

0.0% to 0.0% 

0.0% to 0.0% 

6.0% 

4.0% 

0.0% 

7.7% to 16.7% 

0.0%

0.0%

<$0.1 million 

<$0.1 million 

$0 

$0 

8 

8 

0 

0 

Providers with unusually high billing for 

ophthalmology claims using modifiers 

- Modifiers 24 or 25 

- Modifier 22 

331 

0 

17.3% to 75.0% 

0.0% 

NA‡ 

0.0% 

NA 

0.0%

$0 

NA 

$0 

0 

NA 

0 

 Total** $0.1 million 12 

* The lower quartile is the value for the 25th percentile; the upper quartile is the value for the 75th percentile, and their difference is the interquartile range. 

** Column may not sum to total because of rounding. 

† For this measure, we performed a serial Tukey to identify outliers. For more information, see Appendix A. 

‡ The threshold for questionable billing was above 100 percent; therefore, there were no outliers on this measure in this specialty stratum. 

Source: OIG analysis of 2012 NCH Part B file, 2014. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 27 
APPENDIX E 

Agency Comments 

DEPARTMENT OF HEALTH & HUMA1\J SERVICES 

?00 lt>:lf>P<lodence Avonue SW 

Washmgton. DC 20201 

TO: Daniel R. Levinson 

Inspector General 

FR0\1: Andrew 1vf. Slavin 

Acting Administrator 

SVBJECI': Otlice of Inspector General (OJG) Draft Report: "Questionable Billing for 

Medicare Ophthalmology Services·· (OEI-04-12-00280) 

The Centers for Medicare & Medicaid Services (Cl\·fS) appreciates the opportunity to revkw and 

comment on the Office of Inspector General's (OIG) draft report. CMS is C{)mmitted to 

protecting the Medicare Trust Funds by comba!ting fraud, waste, and abuse. 

To combat fraud, waste. and abuse in Medicare, CMS is using a comprehensive program 

integrity strategy to educate providers, recoup improper payments, and protect taxpayer dollars. 

Specific to ophthalmology claims, CMS released educational materials in July 2014 on 

ophthalmological benefits to educate physicians and other providers on the coverage and billing 

requirements for ophthalmological services. 1 The materials provide guidance on the billing 

requirements for catan1ct surgt,rics, tests to diagnose wet age-related macular degeneration 

(AMD). and procedures to treat wet AMD. Another educational tool for providers is the 

Comparative Billing Report (CBR). CBRs arc an educational tool designed to assist providers by 

providing high level data that allows them to compare their billing patterns to their state and 

national peers. In April 2015, CMS sent out l 0,000 CBRs to pruvidcrs who submitted claims for 

extracapsular cataract removals, general ophthalmological services, and evaluation and 

management (E.iM) services. OIG found that most providers that billed Medicare for 

ophthalmology services did not demonstrate questionable billing on any of OIG's measures in 

2012. 

In addition to prevention and education etl'orts. CMS is working to recover improper payments 

for ophthalmology claims. OIG's recently issued report on potential improper payments for 

ophthalmology claims identified claims that mav have inappropriately billed for certain services, 

including services that diagnose or treat cataracts or wet A~1D.2 CMS is currently working to 

determine the validity of claims that OJG identillcd as pot..::ntially inappropriate in that report and 

will take appropriate action with rt.'Sp<.>ct to those claims. 

To identify providers with questionable billing, CJ\·!S has implemented the Fraud Prevention 

System, (FPS) which applies predictive analytic technology on claims prior to payment to 

identify aberrant and suspicious billing patterns. TI1e FPS nms predictive algorithms and other 

1 Medicare Vision Ser\'icrs, Mt"<licnre Learning Nc1work, ICN 907165, July 2014 
 1 Mcdicar~ Paid S22 ;~li/lion in lOll for l'otenlial~v Jnapproprlal~ VphthalmoloJO' Claims, OEI-04· t2-0028! 


Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 28 
 

 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 29 
 

 

 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 30 
 

 

ACKNOWLEDGMENTS 

This report was prepared under the direction of Dwayne Grant, Regional 

Inspector General for Evaluation and Inspections in the Atlanta regional 

office, and Jaime Stewart, Deputy Regional Inspector General. 

Evan Godfrey served as the lead analyst. Central office staff who 

provided support include Clarence Arnold, Scott Horning, Scott Manley, 

David Tawes, and Christine Moritz. 

Questionable Billing for Medicare Ophthalmology Services (OEI-04-12-00280) 31 
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 OIG’s 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.