AMA: Insurers Misused CPT Codes To Hide Administrative Costs

Aetna Inc., Aetna Life Insurance Co. and Optumhealth Care Solutions Inc. allegedly misused CPT codes to pass on administrative charges under the guise of medical care………….

Feb 26, 2020

Tanya Albert Henry – Contributing News Writer – American Medical Association

Full Bio

When health care companies misuse or misrepresent the Current Professional Terminology (CPT®) code set, it undermines public confidence in those who provide health care services and makes it even harder to come to a consensus about how the health care system should be reformed, physicians say.

And that’s a big reason why the 4th U.S. District Court of Appeals in Virginia needs to overturn a ruling from the U.S. District Court for the Western District of North Carolina, says a brief filed by the Litigation Center of the American Medical Association and State Medical Societies, the North Carolina Medical Society, Maryland State Medical Society, South Carolina Medical Association and Medical Society of Virginia. The amicus brief was filed with the appellate court in the case of Peters v. Aetna.

Find out more about the cases in which the AMA Litigation Center is providing assistance and learn about the Litigation Center’s case-selection criteria.

The brief says the defendants in the case—Aetna Inc., Aetna Life Insurance Co. and Optumhealth Care Solutions Inc.—misused CPT codes to pass on administrative charges under the guise of medical care.

CPT codes are the “definitive resource” to ensure that people and organizations use the same language when referring to medical services and procedures, the brief tells the court. The code set is meant to be used for procedures or services that are actually delivered to a patient, and not to describe administrative costs in the medical record, the brief explains.

Yet the explanation of benefits (EOB) form and emails between the companies’ employees show the health plan used code 97039 to charge Sandra Peters an administrative fee as part of the billing for a chiropractic visit, the brief says.

“CPT does not have ‘catch-all’ or ‘miscellaneous’ codes that can serve as a label for whatever the defendants elect to charge a member and their plan,” according to the brief. “The defendants searched for a CPT code that would be difficult for laymen to understand in order to ‘bury’ (their word) their administrative fees so that they could assert an unjustified, uncontracted charge against Ms. Peters and her employer-funded health insurance plan. … They assumed no one would understand and, because the charge looked official, no one would challenge it. But, Ms. Peters did.”

The AMA is the author and copyright holder of CPT. A panel of 17 medical and allied health professionals representing a broad range of the health care industry, including health insurance companies and dedicated staff support from the AMA maintain and update the CPT code set.

Lower court ruling flawed

The district court granted summary judgment in the case and sealed a large number of documents. The AMA Litigation Center brief tells the appellate court that the summary judgment denying the companies’ liability is “rife with error” and that a jury should have been allowed to consider the case.

The lower court decision states that because “Optum is the provider of the network, the EOB identifies Optum as the ‘provider’ for the service and reports a total ‘amount billed’ which includes the flat-rate contractual fee to Optum and the CPT code required by the Aetna-Optum contracts … Under the Aetna-Optum relationship, Optum receives payments only from Aetna itself, never from an Aetna member or plan sponsor.”

In urging the court to overturn the decision, the AMA Litigation Center brief points out four errors in that passage, including that the defendants could not legitimately select a CPT code, that they are not providers like a physician or hospital, and that Aetna member Peters was asked to pay $14.18 for the charge.

Public should see the documents

In addition to letting a jury hear the case, the public needs to see documents the lower court sealed because there is “evidence of systemic misrepresentations on the part of two health company giants, which administer benefits for millions of Americans,” the AMA Litigation Center brief tells the court.

The brief notes that in 2009 the New York Attorney General found Aetna and Optum parent company UnitedHealth Group liable for fraud in their payment methodology of provider charges and asks, “Should these transgressions be chalked up to inherent human failings, which can be excused by the size and complexity of the health care industry? Do they result from the aberrant behavior of a few rogue employees? Or, do they represent something more? These are questions of public interest.”

 

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