Contractor Physicians Billed Similarly to Their Counterparts for Emergency Department Services

Our comparison of the billings by contractor physicians retained by  staffing companies to other affiliated physicians—such as those practicing  in partnerships, medical groups, and employee-based staffing companies— showed that contractor physicians and those with other affiliations both  billed for higher-level E&M services at comparable rates in four of the five  states we reviewed and at a lower rate in the fifth state we reviewed. To determine the comparability of  patients treated by both types of physicians, we examined the rates at  which patients had been transported by ambulance to the emergency  department, received diagnostic tests, or were admitted to the hospital  within 24 hours of the emergency department visit. Despite Representing a Significant Share of Billings, Staffing Companies That Retain Contractor Physicians Are Practically Invisible to Oversight

In four of the five states we examined, a substantial percentage of the  physicians providing emergency department care were contractor  physicians associated with staffing companies. However, because the staffing companies are not subject to the enrollment  procedures that the carriers routinely conduct for physicians and medical  groups before they are allowed to bill Medicare, CMS does not collect  critical information that would enable it to identify claims that are  submitted by staffing companies on behalf of their contractor physicians. In four of the five states studied, from 27  to 58 percent of the physicians with substantial emergency department  practices were contractor physicians associated with staffing companies. Because staffing companies that retain contractor  physicians may not be reassigned benefits and are not enrolled in  Medicare, CMS has no information on these companies and cannot  associate the billings of individual contractor physicians with specific  staffing companies. CMS’s carriers cannot identify claims  submitted by these staffing companies and, therefore, cannot subject them  to same systematic scrutiny as those of other groups. To determine how the use of staffing companies that retain contractor  physicians has affected CMS’s ability to monitor emergency department  billings, we reviewed documentation related to the provider enrollment  process. Methods for Comparing Billing Patterns

To determine whether contractor physicians retained by staffing  companies bill Medicare for the higher-level services at rates comparable  to other emergency department physicians, we did the following.
Why GAO Did This Study

Staffing companies that contract with physicians to staff hospital departments--including emergency departments--are not permitted to bill Medicare. In the Medicare, Medicaid, and SCHIP Benefits Improvement and Protection Act of 2000, Congress directed GAO to assess the program integrity implications of enrolling these companies and allowing them to bill Medicare. GAO reviewed about 2.8 million emergency department claims for 2000 from five states and assessed whether contractor physicians retained by staffing companies billed Medicare comparably to other emergency department physicians. GAO also evaluated how the lack of information on staffing companies affects efforts to assure Medicare program integrity.

What GAO Found

Contractor physicians associated with staffing companies billed Medicare for complex and costly, higher-level emergency department services at rates similar to emergency department physicians with other affiliations, such as those practicing in partnerships, medical groups, or employee-based staffing companies. In addition, the patients treated by contractor physicians received diagnostic tests, were admitted to the hospital, and used ambulance transport at rates similar to patients treated by other emergency department physicians. Staffing companies that retain contractor physicians remain largely invisible to the oversight efforts of the Centers for Medicare & Medicaid Services (CMS) because these companies are not enrolled in Medicare. Although CMS has information on the individual physicians, it has no information on the companies themselves. This may hinder oversight because contractor physicians provided a significant share of emergency care to Medicare beneficiaries. For example, in four of the five states studied, 27 to 58 percent of the physicians with substantial emergency department practices were contractor physicians retained by staffing companies. CMS does not permit the enrollment of staffing companies that retain contractor physicians because, under current law, these companies may not be reassigned Medicare benefits. This limits CMS's ability to monitor claims. CMS cannot identify claims submitted by these companies on behalf of their contractor physicians nor can it subject the claims to the same systematic scrutiny given to enrolled groups. Consequently, it cannot evaluate the billing patterns of specific companies nor assess the aggregate impact of these companies on Medicare program integrity.