Department of Health and Human Services

OFFICE OF 

INSPECTOR GENERAL 

 

Daniel R. Levinson 

Inspector General 

May 2009 

OEI-07-07-00390 

 

INAPPROPRIATE MEDICARE 

PAYMENTS FOR 

CHIROPRACTIC SERVICES 
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. 
 

ΔEXECUTIVE SUMMARY EXECUTIVE SUMMARY 

OBJECTIVE

To determine the extent to which: 

(1) chiropractic claims allowed in 2006 for beneficiaries receiving 

more than 12 services from the same chiropractor were 

appropriate, 

(2) controls ensured that chiropractic claims were not for maintenance 

therapy, 

(3) claims data can be used to identify maintenance therapy, and 

(4) chiropractic claims were documented as required. 

BACKGROUND 

As required by the Social Security Act, Medicare pays only for medically 

necessary chiropractic services, which are limited to active/corrective 

manual manipulations of the spine to correct subluxations. 

Chiropractors must use the acute treatment (AT) modifier to identify 

services that are active/corrective treatment and must document 

services in accordance with the Centers for Medicare & Medicaid 

Services’ (CMS) “Medicare Benefit Policy Manual” (the Manual) when 

submitting claims. When further improvement cannot reasonably be 

expected from continuing care, the services are considered maintenance 

therapy, which is not medically necessary and therefore not payable 

under Medicare. 

We identified allowed claims with the AT modifier for beneficiaries with 

more than 12 claims from the same chiropractor in 2006. We then 

contracted with a medical review contractor to review medical records 

from a simple random sample of 188 claims. For each treatment 

episode, the medical records were reviewed to identify the initial visit 

and subsequent visits (if relevant) to determine whether each sampled 

claim was active/corrective treatment or maintenance therapy, the 

extent to which chiropractors supported their use of the AT modifier 

with proper documentation indicating active/corrective treatment, 

whether claims were coded properly, and whether documentation met 

the Manual requirements. 

FINDINGS 

Medicare inappropriately paid $178 million for chiropractic claims in 

2006, representing 47 percent of claims meeting our study criteria. 

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EXECUTIVE SUMMARY 

In 2006, Medicare inappropriately paid $178 million (out of 

$466 million) for chiropractic claims for services that medical reviewers 

determined to be maintenance therapy ($157 million), miscoded 

($11 million), or undocumented ($46 million). These claims represent 

47 percent of all allowed chiropractic claims that met the study criteria. 

Claims representing $36 million had multiple errors. 

Efforts to stop payments for maintenance therapy have been largely 

ineffective. CMS, carriers, and program safeguard contractors (PSC) 

use a number of strategies to deter inappropriate payments for 

maintenance therapy, including use of the AT modifier to indicate 

active/corrective treatment, provider education, frequency-based control 

edits (caps), and focused medical review. Despite these efforts, carriers 

and PSCs continue to report high errors for chiropractic claims. Carrier 

staff, PSC staff, and medical reviewers for this study agreed that the 

AT modifier did not prevent inappropriate payments for maintenance 

therapy because chiropractors continued to submit claims for 

maintenance therapy with the AT modifier. 

Claims data lack initial visit dates for treatment episodes, hindering 

the identification of maintenance therapy. To identify active/corrective 

treatment and thereby distinguish it from maintenance therapy, it is 

useful to identify the start of a new treatment episode. However, claims 

data do not indicate when an episode begins. Thus, we asked sampled 

chiropractors and the medical reviewers to identify when an episode 

began and ended. Overall, only 50 percent of all treatment episodes 

remained active/corrective throughout the treatment episode. In 

addition, 78 percent of those treatment episodes that became 

maintenance therapy did so by the 20th visit. The Comprehensive Error 

Rate Testing (CERT) paid claims error rate used by CMS is based on a 

review of a single claim, which limits its ability to detect maintenance 

therapy and may underestimate errors in claims for chiropractic 

services. 

Chiropractors often do not comply with the Manual documentation 

requirements. Separate from the undocumented claims counted as 

errors above, 83 percent of chiropractic claims failed to meet one or 

more of the documentation requirements. Consequently, the 

appropriate use of the AT modifier could not be definitively determined 

through medical review for 9 percent of sampled claims, representing 

$39 million. 

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EXECUTIVE SUMMARY 

The medical reviewers indicated that treatment plans are an important 

element in determining whether the chiropractic treatment was 

active/corrective in achieving specified goals. Of the 76 percent of 

records that reviewers indicated contained some form of treatment plan, 

43 percent lacked treatment goals, 17 percent lacked objective 

measures, and 15 percent lacked the recommended level of care. 

RECOMMENDATIONS 

Medicare continues to pay inappropriately for maintenance therapy 

despite acknowledging this vulnerability in response to previous Office 

of Inspector General work and subsequent efforts aimed at prevention. 

Because of high error rates and poor documentation, we recommend 

that CMS: 

Implement and enforce policies to prevent future payments for 

maintenance therapy. CMS can achieve this by implementing a new 

modifier for chiropractic claims to indicate the start of a new treatment 

episode and/or implementing a cap on allowed chiropractic claims. 

Review treatment episodes rather than individual chiropractic claims 

to strengthen the ability of the CERT to detect errors in chiropractic 

claims. CMS should consider expanding the CERT review from a single 

sampled claim to a treatment episode that includes all claims from the 

initial visit to the sampled claim for a sample of (1) all chiropractic 

claims or (2) chiropractic claims for beneficiaries receiving 12 or more 

services per year because of their increased vulnerability. Under this 

review, CMS would continue to sample claims in the current CERT 

process but would also request associated claims prior to the sampled 

claims to augment the medical review. 

Ensure that chiropractic claims are not paid unless documentation 

requirements are met. CMS can achieve this by requiring carriers, 

whose responsibilities will transition to Medicare Administrative 

Contractors (MAC) by 2011, to withhold payment on reviewed claims 

when required documentation is absent or requiring carriers/MACs to 

perform prepayment review of claims from chiropractors who repeatedly 

fail to meet documentation requirements.

Take appropriate action regarding the undocumented, medically 

unnecessary, and miscoded claims identified in our sample. 

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EXECUTIVE SUMMARY 

AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL 

RESPONSE 

In its written comments on the report, CMS agreed with the second 

recommendation and described actions it would take to address the 

fourth recommendation. CMS did not indicate agreement or 

disagreement with the first and third recommendations. 

In response to the second recommendation, CMS indicated that it is now 

reviewing 6 months of claims prior to sampled claims in response to a 

recommendation from a prior OIG report. As a result, the CERT error 

rate increased from 8.9 percent to 15.3 percent from 2005 to 2006. CMS 

indicated it would have to conduct a cost-benefit analysis to determine 

the utility of expanding this review to include claims beginning with the 

first claim of the treatment episode. We encourage CMS to conduct this 

analysis because the intent of CERT is to determine error rates, identify 

programs at risk, and prevent future overpayments. OIG has 

repeatedly found overpayments for maintenance therapy. 

In response to the fourth recommendation, CMS stated that it would 

instruct the contractors to take any necessary corrective actions with 

respect to the sampled claims that this study identified as being in 

error. 

In response to the first recommendation, CMS indicated that the 

objective data required to impose a national cap on the number of 

chiropractic services does not currently exist. In response to the third 

recommendation, CMS described the current process contractors use to 

review provider claims with a greater likelihood of payment error, but 

CMS indicated no change in future practice to prevent claims without 

required documentation from being paid in error. We ask that in its 

final management decision, CMS more clearly indicate whether it 

concurs with our first and third recommendations and what steps, if 

any, it will take to implement them. 
Δ TABLE OF CONTENTS 

EXECUTIVE SUMMARY .....................................i

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

FINDINGS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 

Medicare inappropriately paid $178 million for chiropractic 

claims . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 

Efforts to stop payments for maintenance therapy have been 

largely ineffective . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 

Claims data lack information to identify maintenance therapy . . 15 

Chiropractors often do not comply with Medicare documentation 

requirements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 

RECOMMENDATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 

Agency Comments and Office of Inspector General Response . . . 19 

APPENDIXES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 

 A: Documentation Errors for Sampled Records . . . . . . . . . . . . . . 21 

 B: Point Estimates and Confidence Intervals . . . . . . . . . . . . . . . . 22 

 C: Sample Documentation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 

 D: Agency Comments. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 

ACKNOWLEDGMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
 

Δ INTRODUCTION 

OBJECTIVE 

To determine the extent to which: 

(1) chiropractic claims allowed in 2006 for beneficiaries receiving 

more than 12 services from the same chiropractor were 

appropriate, 

(2) controls ensured that chiropractic claims were not for maintenance 

therapy, 

(3) claims data can be used to identify maintenance therapy, and 

(4) chiropractic claims were documented as required. 

BACKGROUND 

As required by the Social Security Act (the Act), Medicare pays only for 

reasonable and necessary chiropractic services, which are limited to 

active/corrective manual manipulations of the spine to correct 

subluxations.1 A chiropractic service “must have a direct therapeutic 

relationship to the patient’s condition and provide reasonable 

expectation of recovery or improvement of function.”2 The Centers for 

Medicare & Medicaid Services (CMS) “Medicare Benefit Policy Manual” 

(the Manual) allows chiropractors an opportunity to produce functional 

improvement or arrest or retard deterioration for subluxations within a 

reasonable and generally predictable period of time.3 When further 

improvement cannot reasonably be expected from continuing care and 

the services become supportive rather than corrective, the services are 

1 Sections 1861(r) and 1862(a)(1)(A) of the Act, 42 U.S.C. § 1395x(r), 

42 U.S.C. § 1395y(a)(1)(A)); 42 CFR § 410.21(b); CMS, “Medicare Benefit Policy Manual 

[Internet Only Manual],” Pub. 100-02, chapter 15, § 240.1.2, defines subluxation as “a 

motion segment, in which alignment, movement integrity, and/or physiological function of 

the spine are altered although contact between joint surfaces remains intact.” Available 

online at http://www.cms.hhs.gov/Manuals/IOM/list.asp. Accessed on July 30, 2008. 

2 CMS, “Medicare Benefit Policy Manual [Internet Only Manual],” Pub. 100-02, 

chapter 15, § 240.1.3. Available online at http://www.cms.hhs.gov/Manuals/IOM/list.asp. 

Accessed on July 30, 2008. 

3 CMS, “Medicare Benefit Policy Manual [Internet Only Manual],” Pub.100-02, 

chapter 15, §240.1.5. Available online at http://www.cms.hhs.gov/Manuals/IOM/list.asp. 

Accessed on September 29, 2008. 

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INTRODUCTION 

considered maintenance therapy.4 The Manual provides that 

maintenance therapy is not considered a medically necessary 

chiropractic service and is therefore not payable under Medicare.5 

Medicare Requirements for Chiropractic Claims 

Chiropractic claims have specific billing requirements. Chiropractors 

are limited to billing three Current Procedural Terminology (CPT) codes 

under Medicare: 98940 (chiropractic manipulative treatment; spinal, 

one to two regions), 98941 (three to four regions), and 98942 (five 

regions).6 When submitting manipulation claims, chiropractors must 

use an acute treatment (AT) modifier to identify services that are 

active/corrective treatment of an acute or chronic subluxation. 

Although the title of the modifier indicates that it should be used only 

for acute treatment, the Manual states that the modifier should be used 

for acute or chronic treatment as long as it is considered 

active/corrective. By using the AT modifier, chiropractors indicate that 

the treatment provided is indeed active/corrective in nature. Medicare 

should deny claims without the AT modifier as those services are 

considered maintenance therapy.7 

The Manual outlines seven general documentation requirements for 

initial visits and three general documentation requirements for 

subsequent visits, as listed below.8

Initial visit. 

1. Subluxation(s) demonstrated by x-ray or physical examination 

(physical examinations must demonstrate at least two of the four 

following criteria: pain/tenderness, asymmetry/misalignment, 

4 CMS, “Medicare Benefit Policy Manual [Internet Only Manual],” Pub 100-02, 

chapter 15, § 30.5.B, defines maintenance therapy as “a treatment plan that seeks to 

prevent disease, promote health, and prolong and enhance the quality of life; or therapy 

that is performed to maintain or prevent deterioration of a chronic condition.” Available 

online at http://www.cms.hhs.gov/Manuals/IOM/list.asp. Accessed on July 30, 2008. 

5 Ibid. CMS, “Addressing Misinformation Regarding Chiropractic Services and 

Medicare.” Available online at 

http://www.cms.hhs.gov/MLNProducts/downloads/Chiropractors_fact_sheet.pdf. Accessed 

on July 30, 2008. 

6 American Medical Association, “Current Procedural Terminology,” 2006. 

7 CMS, “Medicare Benefit Policy Manual [Internet Only Manual],” Pub. 100-02, 

chapter 15, § 240.1.5. Available online at http://www.cms.hhs.gov/Manuals/IOM/list.asp. 

Accessed on July 30, 2008. 

8 CMS, “Medicare Benefit Policy Manual [Internet Only Manual],” Pub. 100-02, 

chapter 15, § 240.1.2. Available online at http://www.cms.hhs.gov/Manuals/IOM/list.asp. 

Accessed on July 30, 2008. 

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INTRODUCTION 

abnormal range of motion, and tissue/tone changes, one of which 

must be either asymmetry/misalignment or abnormal range of 

motion),9

2. Diagnosis of subluxation(s), 

3. Patient history (lists such items as symptoms and past health 

history), 

4. Description of present illness, 

5. Treatment plan (includes a recommended level of care, specific 

treatment goals, and objective measures to evaluate treatment 

effectiveness), 

6. Physical examination, and 

7. Date of initial treatment.10

Subsequent visit. 

1. Patient history (lists such items as changes since last visit), 

2. Physical examination, and 

3. Documentation of treatment provided at each visit. 

CMS Oversight 

The Federal Managers Financial Integrity Act requires each executive 

agency to establish and maintain internal controls for oversight, 

including appropriate payment of claims.11 CMS monitors the rates of 

inappropriate payments for Medicare fee-for-service claims through the 

Comprehensive Error Rate Testing (CERT) program.12 At the time of 

our review, CMS contracted with Medicare Part B carriers and program 

safeguard contractors (PSC) to perform oversight, including program 

integrity and data analysis activities.13 CMS required that carriers and 

9 Ibid. 

10 Although seven requirements are listed here for the initial visit, only five are listed in 

Appendix A. The medical reviewers analyzed the initial visit requirements 6 and 

7 (physical exam and date of initial treatment) in conjunction with the initial visit 

requirement 1 (subluxation demonstrated by x-ray or physical examination). 

11 31 U.S.C. §§ 3512(b) and (c). 

12 CMS also uses the Hospital Payment Monitoring Program to measure error rates for 

fee-for-service claims. This program does not include chiropractic services. 

13 Under Medicare Contracting Reform, responsibilities of carriers are transitioning to 

Medicare Administrative Contractors (MAC). At the time of our review, none of the carriers 

had completed the transition. 

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INTRODUCTION 

PSCs provide assurances that controls were in place to identify and 

correct any areas of weakness in program operations.14 

CERT. CMS has established the CERT program to randomly sample 

and review different types of service claims submitted to Medicare. The 

2006 and 2007 CERT reports listed overall error rates for chiropractic 

services of 16 percent and 11 percent, respectively. 15

To calculate error rates, CERT staff randomly select claims for services 

each month from each contractor. CERT staff then request only the 

medical record associated with the sampled claim from the provider that 

submitted the claim. CERT staff do not request medical records related 

to complete treatment episodes for sampled chiropractic claims. 

Carrier responsibilities. Carriers’ primary function was to pay for 

Medicare-covered services that are reasonable and necessary for eligible 

individuals. Carriers may have implemented frequency-based controls 

that generally fall into one of two categories: soft caps and hard caps. 

With either type of cap, the carrier determined a frequency or dollar 

threshold for the services that it would routinely allow during a 

specified time period, usually 1 year. 16

• Soft caps—Medicare carriers generally used soft caps to suspend 

payment for any claims for service that were submitted exceeding a 

threshold. Carriers requested additional documentation from the 

chiropractors for claims exceeding the threshold. The claims were 

paid if the documentation demonstrated that continued treatment 

was medically necessary. 

• Hard caps—For certain services, carriers tracked the number of 

services or expenditures per patient and did not pay for services 

beyond an established threshold even if they were medically 

necessary. Carriers did not use hard caps for chiropractic claims at 

the time of our review, although hard caps existed in other 

disciplines, such as physical therapy. Other health care payors use 

14 CMS, “Medicare Financial Management Manual [Internet Only Manual],” 

Pub. 100-06, chapter 7, § 30.1. Available online at 

http://www.cms.hhs.gov/Manuals/IOM/list.asp. Accessed on July 30, 2008. 

15 CMS, “Improper Medicare Fee-For-Service Payments Report - November 2006 Long 

Report” and “Improper Medicare Fee-For-Service Payments Report - November 2007 Long 

Report.” Available online at http://www.cms.hhs.gov/apps/er_report/index.asp. Accessed on 

September 25, 2008. 

16 OIG interviews with carrier staff conducted in association with “Chiropractic Services 

in the Medicare Program: Payment Vulnerability Analysis” (OEI-09-02-00530). 

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INTRODUCTION 

hard caps for chiropractic claims. For example, many Federal 

Employee Health Benefit plans impose frequency limits on 

chiropractic claims ranging from 12 to 20 per year. 

PSC responsibilities. A PSC can perform one or more of the following 

payment safeguard functions: medical review, cost report audit, data 

analysis, provider education, and fraud detection and prevention.17 

Medicare expects each PSC to: 

• prevent fraud by identifying program vulnerabilities; 

• proactively identify incidents of potential fraud that exist within its 

service area and take appropriate action on each case; 

• investigate allegations of fraud made by beneficiaries, providers, 

CMS, the Office of Inspector General (OIG), and other sources; 

• explore all available sources of fraud referrals in its jurisdiction; 

• initiate appropriate administrative actions to deny or to suspend 

payments that should not be made to providers where there is 

reliable evidence of fraud; 

• refer cases to OIG for consideration of civil and criminal prosecution 

and/or application of administrative sanctions; and 

• refer any necessary provider and beneficiary outreach to the 

education staff at the carrier.18

Previous OIG Work 

Previous OIG studies published in 1986, 1998, and 1999 found that 

significant vulnerabilities existed in connection with chiropractic 

claims, particularly concerning Medicare payments for maintenance 

17 CMS, “Medicare Program Integrity Manual,” Pub 100-08, Change Request 1143. 

Available online at http://www.cms.hhs.gov/Transmittals/Downloads/R12PIM.pdf. Accessed 

on August 1, 2008. Under Medicare Contracting Reform, PSCs are responsible only for 

benefit integrity work (CMS, “Medicare Administrative Contractor Workload 

Implementation Handbook,” chapter 7, § 7.3.1. Available online at 

http://www.cms.hhs.gov/MedicareContractingReform/downloads/ 

MACImplementationHandbook.pdf. Accessed on August 1, 2008.) 

18 CMS, “Medicare Program Integrity Manual [Internet Only Manual],” Pub 100-08, 

chapter 4, § 4.2.2. Available online at 

http://www.cms.hhs.gov/manuals/downloads/pim83c04.pdf. Accessed on August 1, 2008. 

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INTRODUCTION 

therapy.19 Each of these studies recommended frequency edits or caps 

on the number of chiropractic claims allowed. In 2005, OIG conducted 

an additional study that found that 40 percent of allowed chiropractic 

claims in 2001 were for maintenance therapy and that when 

chiropractors provide more than 12 services per year to a beneficiary, 

the likelihood that some of those services were maintenance therapy 

increased greatly.20 OIG recommended that CMS require carriers or 

PSCs to conduct routine service-specific reviews of chiropractic services 

to identify improper payments and implement frequency-based controls 

to target high-volume services for review. Additionally, OIG 

recommended that CMS require carriers to educate chiropractors on 

documentation requirements as outlined in the Manual. 

In its written response to the OIG draft report, CMS concurred with 

those OIG recommendations and indicated that it had taken a number 

of steps to reduce chiropractic error rates, including targeted 

educational efforts and service-specific medical reviews. CMS issued 

three updates in 2004 to the Manual requiring providers to use the 

AT modifier for all chiropractic claims when such services were for 

active/corrective treatment.21 CMS also acknowledged in its written 

comments that because the CERT paid claims error rate is based on a 

review of a beneficiary’s claim at a single point in time instead of claims 

over time, the ability to detect services meeting the definition of 

maintenance therapy is limited.22 

METHODOLOGY 

We used multiple methods to achieve our objectives. The primary 

method used was medical review of records supporting chiropractic 

claims. We also interviewed CMS central office staff, carrier staff, and 

PSC staff; analyzed historical claims data; and reviewed recent 

chiropractic literature. 

19 “Inspection of Chiropractic Services under Medicare” (OAI-05-86-00002); “Chiropractic 

Care: Controls Used by Medicare, Medicaid, and Other Payers” (OEI-04-97-00490); and 

“Utilization Parameters for Chiropractic Treatments” (OEI-04-97-00496). 

20 “Chiropractic Services in the Medicare Program: Payment Vulnerability Analysis” 

(OEI-09-02-00530). 

21 CMS, “Medicare Benefit Policy Manual,” Pub. 100-02, Change Request 3063, released 

in May 2004 was rescinded and replaced in September 2004 with Change Request 3449, 

which was reissued in October 2004. 

22 “Chiropractic Services in the Medicare Program: Payment Vulnerability Analysis” 

(OEI-09-02-00530). See “Agency Comments” section. 

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INTRODUCTION 

Population Identification 

We obtained Medicare-allowed claims data for chiropractic claims 

submitted with procedure codes 98940, 98941, and 98942 and with an 

AT modifier from CMS’s 2006 National Claims History Part B Carrier 

file. This population contained 22,964,790 claims with a total allowed 

amount of $762,148,017. We limited the population to claims for 

beneficiaries who received more than 12 services from the same 

chiropractor in 2006.23 This population contained 13,827,382 claims 

with a total allowed amount of $465,959,195. 

Sample Selection 

We selected a simple random sample of 200 allowed claims from the 

population. Twelve claims were removed from the sample because of 

ongoing OIG investigation work, leaving a final sample of 188 allowed 

claims. We projected our results to the population from which we drew 

the sample. Point estimates with confidence intervals for selected 

statistics are contained in Appendix A. 

Medical Review 

We contracted with a medical review contractor to assist us in data 

collection, selecting medical reviewers, and reviewing medical records. 

The medical review contractor sent up to three medical record request 

letters (the last request via certified mail) to each provider for the 

sampled claims at predetermined time intervals. The letters requested 

all medical records from each chiropractor for the beneficiary from the 

first visit through the end of the treatment episode involving the 

sampled claim, not just records to support the sampled claim. The 

contractor conducted a minimum of three follow-up telephone contacts 

with providers who failed to respond to mailed requests. The contractor 

successfully contacted all chiropractors for all the sampled claims; 

however, chiropractors did not respond with requested documentation 

for seven sampled claims.24 

We worked with the medical review contractor to select chiropractors 

with previous experience in reviewing chiropractic services provided to 

Medicare beneficiaries to serve as medical reviewers for this study. 

These medical reviewers determined whether each sampled claim was 

23 As previously stated, recent OIG work determined that when chiropractors provide 

more than 12 services per year to a beneficiary, the likelihood that some of those services 

constituted maintenance therapy increased greatly. 

24 The chiropractors failing to comply with our request for information have been 

referred to CMS and OIG’s Office of Investigations for appropriate action. 

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INTRODUCTION 

active/corrective treatment or maintenance therapy, the extent to which 

chiropractors supported their use of the AT modifier with proper 

documentation indicating active/corrective treatment, whether claims 

were coded properly, and whether documentation met the Manual 

requirements. For each treatment episode, the medical reviewers 

identified the initial visit if the practicing chiropractor failed to specify 

the initial visit in their submission of documentation. The medical 

reviewers then reviewed the initial visit and subsequent visits (if 

relevant) to determine whether documentation requirements were met 

and whether maintenance therapy was provided. 

We did not automatically exclude records from our medical review when 

chiropractors failed to comply fully with documentation requirements. 

For example, even if not all visits included patient histories and 

descriptions of present illnesses, which are required by Medicare, the 

records were still reviewed. The services rendered on those days were 

not automatically deemed to be maintenance therapy by the medical 

reviewers because documentation was missing. 

We defined inappropriate payments as those made for sampled claims 

that the medical reviewers identified as maintenance therapy, 

miscoded, or undocumented.25 We then projected our results to the 

population of 13.8 million chiropractic claims representing those claims 

for beneficiaries receiving more than 12 services in a year. This may 

have caused us to underestimate error rates for both dollars and 

services because the weight of estimates was divided by 200 rather than 

188 (because of 12 cases under review by OIG). Upcoding and 

downcoding were determined by the number of regions manipulated as 

supported by the documentation compared to the number of regions 

manipulated as indicated by the submitted claims. The net differences 

were reported (i.e., adding or subtracting the amount for the correct 

code from the amount allowed for these claims). 

Interviews and Documentation Collection 

We conducted structured interviews with and collected documentation 

from CMS central office staff, carrier staff, and PSC staff to determine 

how they ensured that claims with the AT modifier were not 

maintenance therapy. CMS interviews included questions about 

25 Claims were undocumented if the provider did not provide the requested 

documentation or if the records did not document that any service was rendered on the date 

claimed. 

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I NTRODUCTION 

documentation requirements, provider education and outreach, and 

Medicare policies. The carrier and PSC staff interviews included 

questions about local coverage determination policies, provider 

education and outreach, coordination of oversight, medical review 

strategies, and resources. When clarification was necessary, we 

obtained documentation of local coverage determination policies, 

Internet-based provider education materials, and other outreach 

materials. Additionally, we reviewed CERT reports from 2003–2007 to 

examine sample methodologies and error rates for chiropractic services. 

Standards 

This study was conducted in accordance with the “Quality Standards for 

Inspections” issued by the President’s Council on Integrity and 

Efficiency and the Executive Council on Integrity and Efficiency.

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In 2006, Medicare inappropriately 

paid a total net $178 million (out 

of $466 million) for chiropractic 

claims for services that were 

maintenance therapy ($157 million), miscoded ($11 million), or 

undocumented ($46 million). These claims represent 47 percent of all 

allowed chiropractic claims that met the study criteria of chiropractors 

providing more than 12 services to the same beneficiary during 2006. 

Seventeen percent of the reviewed claims, representing $36 million, had 

multiple errors. Table 1 groups the improperly paid claims projected to 

the population. 

Δ FINDINGS 

Medicare inappropriately paid $178 million for 

chiropractic claims in 2006, representing 

47 percent of claims meeting our study criteria 

Table 1: Inappropriately Paid Chiropractic Claims in 2006 

Type of Error Claims Claims 

(percentage) Allowed Amount 

Maintenance Therapy 

 Did not accurately reflect 

 active/corrective treatment 4,217,352 32 $141,651,849 

 Did not provide a reasonable 

 expectation of recovery or 

 functional improvement 

3,940,804 30 $134,174,001 

(Overlapping errors for maintenance 

therapy) (3,525,983) (27) ($119,136,032) 

 Total maintenance therapy 4,632,173 36* $156,689,819* 

Miscoded 

 Upcoded 1,728,423 13 $17,896,089 

 Downcoded 553,095 4 ($6,534,821) 

 Total miscoded 2,281,518 18* $11,361,268 (net) 

Undocumented 

 Nonresponse 483,958 4 $14,078,349 

 Claim lacked documentation of 

 treatment 898,780 7 $31,626,679 

 Total undocumented 1,382,738 11 $45,705,028 

 Total errors (gross) 8,296,429 64 $213,756,116* 

(Overlapping errors) (2,212,381) (17) ($35,579,928) 

 Total errors (net) 6,084,048 47 $178,176,188* 

Source: OIG medical review of 2006 chiropractic services. 

*Note: Numbers do not sum as expected because of rounding. 

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FINDINGS 

Medicare inappropriately paid $157 million for maintenance therapy 

The medical reviewers identified 36 percent of the chiropractic claims 

allowed in 2006 that met the study criteria, totaling $157 million, as 

maintenance therapy, for which Medicare does not pay. We found that 

25 percent of the reviewed treatment episodes that included 

maintenance therapy were identified as maintenance at the initial visit. 

This indicates that for these entire treatment episodes, no functional 

improvement could have been expected. All of the inappropriate 

payments for maintenance therapy reflect the medical reviewers’ 

determination based on their review of medical records, not insufficient 

documentation. When certain required documentation was unavailable, 

the medical reviewers relied on other available documentation (such as 

objective measures of treatment effectiveness over time) to determine 

the appropriateness of the AT modifier. 

We could identify no relationship between the area of the spine 

diagnosed with a subluxation(s) and the incidence of maintenance 

therapy. In addition, we did not identify any significant correlations 

between the incidence of maintenance therapy and a given diagnosis. 

We identified 73,936 claims amounting to $2.4 million that were paid 

without the AT modifier being listed as the primary or secondary 

modifier. 

Medicare inappropriately paid a net $11 million for miscoded claims 

The medical reviewers identified 18 percent of the chiropractic claims 

allowed in 2006 that met the study criteria, totaling $79 million in 

allowed claims, as spinal manipulation claims that reflected the 

incorrect number of regions of the spine. The net cost to the program 

was $11 million. Coding errors generally involved upcoding, which is 

billing a more complex and higher paid service than the one documented 

in the medical record. Approximately 41 percent of allowed claims in 

our sample for spinal manipulation on five regions (CPT code 98942) 

were upcoded, and 15 percent of allowed claims for manipulation on 

three to four regions (CPT code 98941) in our sample were upcoded. 

The medical reviewers noted: 

[M]any records . . . did not meet the Medicare guidelines in 

determining a chiropractic subluxation for each area of 

the spine treated. The records would indicate a problem 

in one area of the spine which was examined, but indicated 

treatment to three to four areas of the spine and charged 

according to procedure without correlation to diagnosis. 

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FINDINGS 

Similarly, carriers noted trends in upcoding for chiropractic claims 

based on targeted medical review in their jurisdictions. Staff from one 

carrier explained that in one specific geographic area, “Three to four 

years ago we looked at distribution among three codes, looking at those 

using 98942 frequently. The percentage of abuse with 98942 was 

80 percent or greater.” 

Medicare inappropriately paid $46 million for undocumented claims 

Eleven percent of claims allowed in 2006 that met the study criteria, 

totaling $46 million, were undocumented. The chiropractors for 

7 percent of claims provided us with records that did not document that 

any service was rendered on the date claimed. Additionally, despite 

repeated requests, chiropractors did not provide the documentation 

related to 4 percent of the sampled claims. In both cases, claims that 

lack sufficient documentation to show that care was provided do not 

meet Medicare requirements. 

CMS, carriers, and PSCs use a 

number of strategies to deter 

inappropriate payments for 

maintenance therapy, including use of the AT modifier to indicate 

active/corrective treatment, provider education, frequency-based control 

edits (caps), and focused medical review. Despite these efforts, carriers 

and PSCs continue to report high error rates for chiropractic claims. 

Efforts to stop payments for maintenance 

therapy have been largely ineffective 

The AT modifier does not prevent inappropriate payments for maintenance 

therapy 

Table 2 demonstrates that the number of chiropractic claims submitted 

and allowed changed little since the requirement of the AT modifier for 

active/corrective treatment. Because the 2005 OIG study identified 

40 percent of all 2001 allowed chiropractic claims as maintenance 

therapy, there should have been a decrease—not an increase—in the 

number of allowed claims if CMS’s AT modifier requirement effectively 

prevented inappropriate payments for maintenance therapy. 

Instead, allowed claims increased 3.7 million, or 19 percent, between 

2003 (1 year before the AT modifier guidance) and 2005 (the year after 

the AT modifier guidance). The AT modifier was used on 99.8 percent of 

allowed chiropractic claims in 2005, up from 6.1 percent in 2003. 

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FINDINGS 

Table 2: Estimates of Chiropractic Claims Volume 2001–2006

Calendar 

Year 

Submitted 

Claims 

Mean Claims 

Submitted 

per 

Beneficiary 

Allowed 

Claims 

Percentage of 

Allowed Claims 

With AT 

Modifier 

Percentage of 

Submitted 

Claims 

Allowed 

2001 19,531,700 10.5 15,920,500 6.2 81.5 

2002 21,220,800 10.6 18,111,800 5.9 85.3 

2003 22,521,600 10.9 19,407,300 6.1 86.2 

2004 25,151,800 11.6 21,200,000 34.6 84.3 

2005 26,121,100 11.5 23,075,800 99.8 88.3 

2006 25,845,478 11.3 22,964,790 99.7 88.9 

Source: OIG analysis of estimates from the 1-percent beneficiary sample Part B claims file, 2008. 

Carrier staff, PSC staff, and medical reviewers for this study agreed 

that the AT modifier did not prevent inappropriate payments for 

maintenance therapy. Carrier staff readily indicated, “By putting an 

AT modifier on a claim, chiropractors are getting paid, and they know 

they will get paid.” During its review of trends in chiropractic claims in 

excess of 12 claims per year, one PSC identified two chiropractors with 

100-percent error rates. Staff from another PSC investigating 

suspicious chiropractic claims said, “from a [targeted] medical review 

standpoint, we see lots of chiropractors billing with the AT modifier 

when not appropriate. I would say at least 95 percent of AT modifier 

use is wrong. It is a big issue.” Further, the medical reviewers for this 

study noted that the requirement for the AT modifier did not appear to 

affect chiropractic billing patterns. 

Provider education does not prevent inappropriate payments for 

maintenance therapy 

In response to comments from the chiropractic industry indicating that 

the definition of maintenance therapy was confusing, CMS revised the 

definition of maintenance therapy in the Manual before our review 

period. This revision was made in addition to requiring the AT modifier 

to indicate active/corrective treatment. CMS allowed carriers flexibility 

in educating chiropractors on the revised Medicare requirements. 

Chiropractors continue to submit claims for maintenance therapy with 

the AT modifier even though all 16 carriers indicated that they provided 

education to chiropractors on the correct use of the AT modifier. 

Fourteen carriers reported developing educational programs or 

publishing important information on their Web sites regarding 

appropriate AT modifier usage. Ten carriers volunteered that they 

provided education at conferences or other seminars, and five 

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FINDINGS 

volunteered that they used collaboration with chiropractic associations 

to increase awareness and promote the appropriate use of the 

AT modifier. Eight carriers volunteered that they published material or 

manuals to send to chiropractors. 

Use of frequency-based controls does not prevent all inappropriate 

payments for maintenance therapy; carriers welcome stricter measures 

Soft caps. At the time of our review, half of the carriers used soft caps 

for chiropractic claims based on the frequency of services for a 

particular diagnosis as their primary means of limiting inappropriate 

payments. Staff from one carrier explained, “Diagnoses are split into 

different categories and different numbers of services are permitted. 

This [practice] originated many years ago and became available as a 

‘model policy’ to all carriers.” Staff from another carrier noted in 

reference to their postpayment review process, “As we continue to do 

complex medical review, we continue to deny about 90 percent of 

reviewed claims.” One carrier reported difficulty in implementing an 

internal frequency threshold. After the carrier adjusted its frequency 

threshold, some chiropractors changed their billing behavior by 

submitting claims up to the threshold to avoid review. 

Hard caps. Although 4 carriers had hard caps for chiropractic claims in 

the past, none of the 16 carriers currently have them. Carrier staff 

explained that they no longer have hard caps because of guidance from 

CMS and opposition from the chiropractic community. A CMS staff 

member noted, “Years ago, some [carriers] had auto-deny limits and one 

by one, they got rid of them because of political pressure.” Although 

CMS has hard caps in other disciplines, staff indicated that the lack of 

clinical evidence would make establishing frequency thresholds for 

chiropractic claims difficult. However, staff from 10 carriers indicated 

that they would welcome hard caps on chiropractic claims. Similarly, 

the 2005 OIG report noted that six carriers would like hard caps.

PSCs’ use of focused medical review does not prevent inappropriate 

payments for maintenance therapy 

PSCs based medical review strategies and processing of referrals on 

their individual program integrity priorities, which are generally the 

service areas with the greatest potential for overpayment recovery. 

Though chiropractors submitted claims for more than $1 billion in 2006, 

individual chiropractic claims may be considered small. The average 

allowed charge for a chiropractic claim in 2006 was only $33, while the 

same for a physician office visit was $62. Staff from a PSC responsible 

for program integrity in five major cities across 16 States explained, 

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FINDINGS 

“We have to prioritize our work by the most egregious crimes. We don’t 

look at chiropractic claims and the AT modifier specifically because the 

money is not [significant when reviewing] individual providers.” 

To appropriately identify 

active/corrective treatment 

and thereby distinguish it 

from maintenance therapy, it 

is useful to identify the start of a new treatment episode. Because 

claims data do not indicate when a treatment episode began, we asked 

sampled chiropractors and the medical reviewers to identify when an 

episode began and ended. Overall, only 50 percent of all treatment 

episodes remained active/corrective throughout the treatment episode. 

For the remaining treatment episodes that included maintenance, the 

mean number of claims between the initial visit and the first visit 

determined to be maintenance therapy was 14, with the median number 

being 9 claims. Additionally, 78 percent of those treatment episodes 

that became maintenance therapy did so by the 20th visit. 

Claims data lack initial visit dates for treatment 

episodes, hindering the identification of 

maintenance therapy 

The 2005 OIG study found that the likelihood of services being 

medically unnecessary increased to approximately 67 percent for claims 

between the 13th and 24th visit during a calendar year and 100 percent 

for claims beyond the 24th visit. Combined with our present findings, 

these results indicate that the greater the number of visits after the 

initial visit, the greater the likelihood that a claim will be for 

maintenance therapy. However, chiropractic claims lack an indicator to 

reflect which visits are the initial visits for treatment episodes. 

The initial visit for treatment episodes may not always be a 

beneficiary’s first visit to a chiropractor. A beneficiary may experience a 

recurrence or an exacerbation of a previously treated condition that may 

necessitate the start of a new treatment episode.26 One reviewer 

explained, “Because Medicare covers patients that are predominantly 

65 years or older, the chiropractor is often faced with chronic or 

recurrent conditions. The AT modifier, when applied appropriately, 

26 According to carriers’ local coverage determinations, a recurrence is a return of 

symptoms from a previously treated condition that has been quiescent for 30 or more days. 

An exacerbation is a temporary, marked deterioration of the patient’s condition because of 

an acute flareup of the condition being treated. 

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FINDINGS 

should indicate expectation of functional improvement, regardless of the 

[chronic nature] or redundancy of the problem.” 

Currently, the expectation of functional improvement can be determined 

only from a complete medical review of the treatment episode. In 

contrast, the CERT paid claims error rate used by CMS is based on a 

review of a single claim, which limits its ability to detect maintenance 

therapy and may underestimate errors in claims for chiropractic 

services. 

Separate from the completely 

undocumented claims previously 

discussed as errors in the first 

finding of this study, 83 percent of chiropractic claims failed to meet one 

or more of the documentation requirements. Consequently, the 

appropriate use of the AT modifier could not be definitively determined 

through medical review for 9 percent of sampled claims, representing 

$39 million. See Table 3 for summary information regarding the extent 

to which records for the sampled claims did not meet the documentation 

requirements for initial visits and subsequent visits and Appendix B for 

detailed information regarding specific documentation requirements not 

met for sampled claims. 

Chiropractors often do not comply with the 

Manual documentation requirements 

Table 3: Documentation Errors 

Documentation Requirements Not Present in Record Percentage 

 Initial Visit 

1. Subluxation demonstrated by x-ray or physical exam 11 

2. Diagnosis of subluxation 13 

3. Complete patient history 70 

4. Complete description of present illness 66 

5. Complete treatment plan 63 

 Subsequent Visits 

1. Complete patient history 29 

2. Complete physical exam 43 

3. Documentation of treatment provided 15 

Source: OIG medical review of year 2006 services by practicing chiropractors, 2008. 

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FINDINGS 

Chiropractors provided documentation that varied widely. 

Documentation provided by chiropractors ranged from comprehensive 

standardized forms to “travel cards,” which include no more than simple 

checkboxes.27 At times, handwritten notes were illegible and 

computer-generated notes were unchanged from one visit to the next. 

Carrier staff indicated that documentation for chiropractic claims was 

poor. Staff at one carrier stated, “Several providers blatantly tell us 

that they don’t have time to document the way we want.” Staff at 

another carrier stated that chiropractors do not agree with 

documentation requirements and believe them to be too time 

consuming. 

Documentation for treatment plans was insufficient 

The medical reviewers indicated that treatment plans are an important 

element in determining whether the chiropractic treatment was 

active/corrective in achieving specified goals. The goal may change 

throughout the treatment episode, but it should be documented in the 

medical record to demonstrate active/corrective treatment. Of the 

76 percent of records that reviewers indicated contained some form of 

treatment plan, 43 percent lacked treatment goals, 17 percent lacked 

objective measures, and 15 percent lacked the recommended level of 

care. A staff member from one carrier explained that: 

When reviewing a specific service, we often don’t get a 

treatment plan if it was created at the first visit for the 

episode-this is no more than what we ask from [medical 

doctors]. The general trend is that [the patient will] be 

treated for several months, three to four times per month, 

but there’s no documentation of a treatment plan or any 

goals. 

One of the medical reviewers explained that it is common for 

chiropractors to have treatment plans that include frequency, duration, 

and goals but that these treatment plans often are verbal and 

consequently not always documented. Another medical reviewer 

indicated, “In my 29 years of practice, I rarely saw documentation of a 

plan which included frequency, duration, goals, and objective measures. 

While these guidelines are in the [Medicare] Manual, they apparently 

have not been incorporated into the profession.”

27 See Appendix C for examples of documentation for chiropractic services. 
 

Δ RECOMMENDATIONS 

Medicare continues to pay inappropriately for maintenance therapy 

despite acknowledging this vulnerability in response to previous OIG 

work and subsequent efforts aimed at prevention. In 2006, Medicare 

inappropriately paid $178 million for chiropractic claims, representing 

47 percent of all allowed chiropractic claims that met the study criteria. 

Claims for maintenance therapy accounted for $157 million of these 

inappropriately paid claims. Efforts to prevent inappropriate payments 

for maintenance therapy have been largely ineffective, and the lack of 

initial visit dates in claims data hinders the ability to identify 

maintenance therapy. The expectation of functional improvement can 

be determined only from a complete medical review of the treatment 

episode. In contrast, the CERT paid claims error rate used by CMS is 

based on a review of a single claim, which limits its ability to detect 

maintenance therapy and may underestimate errors in claims for 

chiropractic services. Further, chiropractors often do not comply with 

the Manual documentation requirements. 

Therefore, we recommend that CMS: 

Implement and Enforce Policies To Prevent Future Payments for 

Maintenance Therapy 

CMS can achieve this through implementing (1) a new modifier for 

chiropractic claims to indicate the start of a new treatment episode so 

that carriers/Medicare Administrative Contractors (MAC) can identify 

aberrant treatment patterns through claims data and/or (2) a cap on 

allowed chiropractic claims based on recommendations from a 

consortium of clinical providers. 

Review Treatment Episodes Rather Than Individual Chiropractic Claims To 

Strengthen the Ability of the CERT To Detect Errors in Chiropractic Claims 

CMS should consider expanding the CERT review from a single 

sampled claim to a treatment episode that includes all claims from the 

initial visit to the sampled claim for a sample of (1) all chiropractic 

claims or (2) chiropractic claims for beneficiaries receiving 12 or more 

services per year because of their increased vulnerability. Under this 

review, CMS would continue to sample claims in the current CERT 

process but would also request associated claims before the sampled 

claims to augment the medical review. 

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RECOMMENDATIONS 

Ensure That Chiropractic Claims Are Not Paid Unless Documentation 

Requirements Are Met 

CMS can achieve this by requiring carriers/MACs to (1) withhold 

payment on reviewed claims when required documentation is absent or 

(2) perform prepayment review of claims from chiropractors who 

repeatedly fail to meet documentation requirements. 

Take Appropriate Action Regarding the Undocumented, Medically 

Unnecessary, and Miscoded Claims Identified in Our Sample 

We will forward information on these claims to CMS in a separate 

memorandum. 

AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL 

RESPONSE 

In its written comments on the report, CMS agreed with the second 

recommendation and described actions it would take to address the 

fourth recommendation. CMS did not indicate agreement or 

disagreement with the first and third recommendations. 

In response to the second recommendation, CMS indicated that it 

recently began reviewing 6 months of claims prior to sampled claims in 

response to a recommendation from a prior OIG report. The CERT 

program reported an increased error rate from 8.9 percent in 2005 to 

15.3 percent in 2006 because of this change. However, this new 

process allows for the review of claims only up to 6 months prior to 

sampled claims and may not include the entire chiropractic treatment 

episode. CMS indicated it would have to conduct a cost-benefit 

analysis to determine the utility of expanding this review to include 

claims beginning with the first claim of the treatment episode. CMS 

indicated that expanding the review would cost an additional 

$150,000–$200,000 and would increase the burden on providers, who 

would need to furnish additional medical documentation. We encourage 

CMS to conduct this analysis because the intent of CERT is to 

determine error rates, identify programs at risk, and prevent future 

overpayments. OIG has repeatedly found overpayments for 

maintenance therapy. 

In response to the fourth recommendation, CMS stated that it would 

instruct the contractors to take any necessary corrective actions with 

respect to the sampled claims that this study identified in error. 

In response to the first recommendation, CMS indicated that the 

objective data required to impose a national cap on the number of 
 

RECOMMENDATIONS 

chiropractic services does not currently exist. CMS stated that it will 

review any research studies as they become available. CMS also stated 

it will consider implementing an additional modifier after it works 

through the policy and operational implications. We encourage CMS to 

ensure that such studies and policy reviews are conducted. 

In response to the third recommendation, CMS described the current 

process contractors use to review provider claims with a greater 

likelihood of payment error. However, CMS indicated no change in 

future practice to prevent claims without required documentation from 

being paid in error. 

We ask that in its final management decision, CMS more clearly 

indicate whether it concurs with our first and third recommendations 

and what steps, if any, it will take to implement them. 

The full text of CMS’s comments can be found in Appendix D.

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Table A-1: Documentation Errors for Sampled Records

Documentation Requirements Not Present n 

Point Estimate 

(percentage) 

95-Percent Confidence 

Interval 

Initial Visit 

1. Subluxation demonstrated by x-ray or physical exam 188 11 7–17 

2. Diagnosis of subluxation 188 13 9–19 

3. Complete patient history 188 70 63–77 

 Any patient history 188 6 3–11 

 • symptoms causing patient to seek treatment 176 2 0–5 

 • family history, if relevant 176 2 1–6 

 • past health history 176 40 33–48 

 • mechanism of trauma 176 29 22–36 

 • quality and character of symptoms 176 13 8–19 

 • onset, duration, intensity, frequency, location, and radiation of symptoms 176 22 16–29 

 • aggravating or relieving factors 176 41 34–49 

 • prior interventions, treatments, medications, and secondary complaints 176 42 35–50 

4. Complete description of present illness 188 66 59–73 

 Any description of present illness 188 7 4–12 

 • mechanism of trauma 175 29 23–36 

 • quality and character of symptoms 175 14 9–20 

 • onset, duration, intensity, frequency, location, and radiation of symptoms 175 22 16–29 

 • aggravating or relieving factors 175 40 33–48 

 • prior interventions, treatments, medications, and secondary complaints 175 43 36–51 

 • symptoms causing patient to seek treatment 175 2 0–5 

5. Complete treatment plan 188 63 55–70 

 Any treatment plan 188 12 8–18 

 • recommended level of care 142 15 9–22 

 • specific treatment goals 142 43 35–52 

 • objective measures to evaluate effectiveness 142 17 11–24 

Subsequent Visits 

1. Complete patient history 174 29 23–37 

 Any patient history 174 24 18–31 

 • review of chief complaint 146 7 3–12 

 • changes since last visit 146 9 5–15 

 • system review, if relevant 146 0 0–3 

2. Complete physical exam 174 43 35–50 

 Any physical exam 174 22 16–29 

 • exam of area of spine involved in diagnosis 149 3 1–8 

 • assessment of change in patient condition since last visit 149 15 9–22 

 • evaluation of treatment effectiveness 149 28 21–35 

3. Documentation of treatment provided 188 15 11–21 

Source: Office of Inspector General (OIG) analysis of chiropractic claims data, 2008. 

Δ APPENDIX ~ A 

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Table B-1: Point Estimates and Confidence Intervals for Reported Statistics

Description Point Estimate 

(n=188) 

95-Percent Confidence 

Interval 

Sampled service did not accurately reflect active/corrective treatment (dollars) $141,651,849 $111,533,439–$171,770,260 

Sampled service did not accurately reflect active/corrective treatment (services) 4,217,352 3,339,500–5,095203 

Sampled service did not accurately reflect active/corrective treatment (percent) 32 26–39 

Sampled service did not provide a reasonable expectation of recovery (dollars) $134,174,001 $104,191,663–$164,156,339 

Sampled service did not provide a reasonable expectation of recovery (services) 3,940,804 3,078,963–4,802,645 

Sampled service did not provide a reasonable expectation of recovery (percent) 30 24–37 

Overlapping errors for maintenance (dollars) $119,136,032 $90,389,067–$147,882,997 

Overlapping errors for maintenance (services) 3,525,983 2,692,302–4,359,663 

Overlapping errors for maintenance (percent) 27 21–34 

Total maintenance (dollars) $156,689,819 $125,616,059–$187,763,579 

Total maintenance (services) 4,632,173 3,734,157–5,530,189 

Total maintenance (percent) 36 29–43 

Upcoded (dollars) $17,896,089 $10,927,509–$24,864,670 

Upcoded (services) 1,728,423 1,091,748–2,365,098 

Upcoded (percent) 13 8–18 

Downcoded (dollars) (6,534,821) ($1,876,340)–(11,193,301) 

Downcoded (services) 553,095 174,622–931,569 

Downcoded (percent) 4 1–7 

Sampled service was coded at the wrong level (net dollars) $11,361,268 $2,693,506–$20,029,031 

Sampled service was coded at the wrong level (services) 2,281,518 1,568,210–2,994,826 

Sampled service was coded at the wrong level (percent) 18 12–23 

Allowed claims miscoded (gross dollars) $79,443,841 $53,932,302–$104,955,380 

Undocumented because of nonresponse (dollars) $14,078,349 $3,667,275–$24,489,422 

Undocumented because of nonresponse (services) 483,958 128,947–838,970 

Undocumented because of nonresponse (percent) 4 1–6 

Undocumented because of claim lacking documentation (dollars) $31,626,679 $14,572,367–$48,680,992 

Undocumented because of claim lacking documentation (services) 898,780 423,067–1,374,493 

Undocumented because of claim lacking documentation (percent) 7 3–11 

Total undocumented services (dollars) $45,705,028 $26,193,289–$65,216,768 

Total undocumented services (services) 1,382,738 804,611–1,960,866 

Total undocumented services (percent) 11 6–15 

Source: Office of Inspector General (OIG) analysis of chiropractic claims data, 2008. 

Δ APPENDIX ~ B 
 

APPENDIX ~ B 

Table B-1: Point Estimates and Confidence Intervals for Reported Statistics, continued 

Description n Point 

Estimate 

95-Percent Confidence 

Interval 

Total errors - gross (dollars) 188 $213,756,116 $171,388,169–$256,124,062 

Total errors - gross (services) 188 8,296,429 6,840,140–9,752,719 

Total errors - gross (percent) 188 64 53–75 

Overlapping errors (dollars) 188 $35,579,928 $17,625,483–$53,534,373 

Overlapping errors (services) 188 2,212,381 1,432,138–2,992,624 

Overlapping errors (percent) 188 17 11–23 

Total errors - net (dollars) 188 $178,176,188 $146,394,603–$209,957,773 

Total errors - net (services) 188 6,084,048 5,148,437–7,019,659 

Total errors - net (percent) 188 47 40–54 

Services that were maintenance at the initial visit (percent) 56* 25 14–38 

Claims coded at 98941 that were upcoded (percent) 118 15 9–23 

Services that remained active/corrective throughout treatment episode (percent) 181 50 43–58 

Number of claims from initial visit to maintenance therapy (mean) 56* 14 9–19 

Number of claims from initial visit to maintenance therapy (median) 56* 9 7–11 

Appropriate use of acute treatment (AT) modifier could not be determined 

(percent) 181 9 5–14 

Appropriate use of AT modifier could not be determined (dollars) 181 $38,780,967 $20,119,585–$57,442,349 

Claim failed to meet one or more of the documentation requirements (percent) 188 83 77–88 

Record includes a treatment plan (percent) 188 76 69–82 

Source: OIG analysis of chiropractic claims data, 2008. 

*Because some treatment episodes last years, some maintenance claims were excluded because we were unable to determine when the initial visit occurred. 

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Δ APPENDIX ~ C 

Figure C-1: Sample Documentation—Travel Card 

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APPENDIX ~ C 

Figure C-2: Sample Documentation—Standardized Form 

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Δ APPENDIX ~ D 

Agency Comments 

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/"~vo""".",, {A4- DEPARTME T OF HEALTH & HUMAN SERVICES

....>~

1~"oOut

Cenlers lor Medicare & Medicaid Services

200 Independence Avenue SW

Washington, DC 20201

DATE: MAR 0 t 2~OO

TO: Daniel R. Levinson

lnspector General

FRO harlene Prizzera /"'/ , . :J-ti ~J.- Acting Administrator

SUBJECT: Officc of Inspector General (DIG) Draft Report: "Inappropriate Mcdicare

Payments for Chiropractic ervices," (OEI-07-07-00390)

Thank you for the opportunity to commcnt on the OIG draft rcport entitled,

"Inappropriate Medical' Payments for hiropractic Services." , he Centers for Mcdicare

& Medicaid Service (eMS) appreciates the time and resources the DIG has inve ted to

research and report on thi issue. Based on a 2005 DIG report on this ame topic CM is

pleased to rcport that wc made appropriate change to the currcnt claims processing

opcrations to review claims during the episode of carc, peeifically with the

Compr hensive Error Rate Testing ( ERT) program. PCI' your 2005 recommendation to

help CM idcntify claims for non-coverd maintenancc therapy ERT has been rcviewing

6 months of claims data associatcd with each samplcd chiropractic claim giving CMS a

bctter view ofthc cpi ode of care. This changc to our claims process has bcen

worthwhilc and ha helped us to identify inappropriate billings for maintenance therapy.

While wc concur with your current recommendation to expand thi 6 month rcvicw to the

entire treatment episode back to thc initial vi it to help identify other potentially

inappropriate claim for maintenance therapy we want to analyze thc co t and benefits

before we fully implement the recommendation in the most recent report.

OIG Recommendation

Implement and enforce policies to prevcnt future payment for maintenance therapy by

implcmenting a cap on all chiropractic claims based on I' commendations from a

onsortium of clinical provider and developing a new modifi r.

CMS Response

The DIG recommends that CMS implement a cap on all wed chiropractic claims based

on recommendations from a consortium of clinical providcrs. M would need objective

data and studics in order to imposc a national cap on the number ofsessions a

chiropractor could provide to a Medicare beneficiary. Although we do not believe
 

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APPENDIX ~ D 

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Page 2 - Daniel R. Levinson

sufficient studies or data currently exist. C

studies as they become available.

will continue to rcview any such research

The 010 also recommends that CMS develop a new modi tier for providers to usc to

report to CMS Ihal a different episode of care is beginning. We appreciate the ugge tion

and are working Ihrough the policy and operational implications ofrequiring an

additional modifier and will consider implementing it ifit is feasible.

OIG Recommendation

Review entire treatment episodes rather than individual chiropractic claims to strengthen

the ability ofthe CERT to detect errors in chiropractic claims.

C S Response

As we noted earlier. the CM agrees with OIO's recommendation that the CERT

contractor should review medical records thaI precede the service date orthe chiropractic

claim being reviewed to look lor possible non-covered maintenance therapy. For several

months now, the CERT contractor has been reviewing 6 months of medical records tor

each chiropractic claim included in the CERT sample looking to be sure that the sampled

claim could not be considered a maintenance visit. CERT considers claims that are

maintenance visits to be error.

This change was implemented in response to the OIO's June 2005 report. which looked

at chiropractic claims submitted in 2001. Atier M eonsultcd with its contractors and

the chiropractic associations. M determined that a review of 6 months of medical

records would provide sufficient information to determine if the service billed was

maintenance therapy. In fact. as a result of your recommendation and the implementation

ofthe 6 month requirement. the CERT program reported an increase in the errors for

chiropractic claims. From 2005 to 2006. the chiropractic claims error rate increased from

8.9 percent to 15.3 percent.

Again, whi Ie we concur that a full review of the entire treatment epi ode would further

help identify potential errors. expanding the CERT review to include the initial claim

would require additional funding. Based on our research. it would cost the CERT

program an additional S150.000-$200.000 per year to expand our reviews of chiropractic

episodes from 6 to 12 months and more if were to include the beginning ofthe episode.

In addition. CM would have to consider the burden on the providers to furnish

additional medical documentation. CM would have to conduct a cost benefit analysis of

expanding the review.

OIG Recommendation

Ensure that chiropractic claim are not paid unIe documentation requirements are met.
 

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APPENDIX ~ D 

Page 3 - Daniel R. Levinson

CMS Response

Based on data analy 'is. contractors identify provider that have a likelihood of a

sustained or high level of payment error. For those providers. the contractor will review

the provider's elaims based on the contractor's medical review strategy. When

performing this review, contractors may collect documentation. such as claims

information, related to the patient' condition bdore and aner the service in order to get a

more complete picture of the patient's clinical condition.

In accordance with current practice. a provider's claims that are reviewed betore the

claim is paid will not receive payment until the contractor receives sufficient

documentation to determine that paymem should be made. Since a lack ofsufticient

documentation ollen causes an increase in the provider's denied claims.. the likelihood

increases that the provider may be selected tor further review, Delaying payment

indefinitely while wDiting tor all requested documentation would prevent the contractor

from processing the claims in a timel manner.

OIG Recommendation

Take appropriate corrective action regarding the undocumented, medically unneccssary,

and mi coded claim in our sample.

CMS Response

We will advise our contractor to continue to emphasize that appropriate documentation

must be maintained. We will inform our contractors of the findings in this OIG report

and request that they include the information contained in this reporl as part of the data

they consider when prioritizing their strategies. In addition, the contractors will bc

instructed to take any neces ary corrective action". including determining overpayments.

when appropriate.

The CMS thanks the OIG for it eftorts on this report and for highlighting this potential

vulnerability in the Medicare program. CM is commitled to continually reviewing and

retining our processes to improve the Medicare program, and we will take the findings of

this report under consideration as we continue to strengthen our oversight efforts to

further reduce improper payments in the Medicare program. We look forward to

continuing to work with the OIG to idenli fY and prevent fraud, waste. and abuse in the

Medicare program.
 

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Δ ACKNOWLEDGMENTS 

This report was prepared under the direction of Brian T. Pattison, 

Regional Inspector General for Evaluation and Inspections in the 

Kansas City regional office. 

Brian Whitley served as the team leader for this study. Other principal 

Office of Evaluation and Inspections staff from the Kansas City regional 

office who contributed to the report include Michael Barrett, 

Megan Buck, and Julie Dusold; central office staff who contributed 

include Rob Gibbons and Kevin Manley.