Navigating Increased Scrutiny: What Acupuncturists Need to Know About VA Audit Findings and Legal Risks

By: Sinead Killeen

The regulatory environment for acupuncture providers is becoming increasingly complex as scrutiny and enforcement actions under the False Claims Act intensify. A 2021 audit by the Department of Veterans Affairs (VA) has revealed significant concerns about the handling of payments and authorizations for acupuncture services provided to veterans through non-VA providers. Understanding these findings and their implications is crucial for practitioners to effectively navigate these changes.

Expanding Coverage and Scrutiny

Acupuncture services for veterans have been a part of the VA’s offerings long before traditional Medicare even considered covering these treatments. The Veterans’ Access to Care through Choice, Accountability, and Transparency Act of 2014 (Choice Act) and the VA MISSION Act of 2018 were pivotal in expanding veterans’ access to acupuncture and accelerated referrals to non-VA providers. These acts allowed veterans to access funding to obtain acupuncture treatment from non-VA providers, given that the VA lacked sufficient in-house acupuncturists to meet demand.

During Fiscal Years (FYs) 2018 and 2019, the VA paid approximately $114 million to non-VA community acupuncture providers. However, a December 2021 audit by the VA’s Office of Inspector General (OIG) revealed significant issues with many of these payments. As a result, the number of VA acupuncture audits has increased dramatically. This article will examine the reasons cited for denying acupuncture claims and discuss strategies to reduce audit risks.

Problems Identified in VA Acupuncture Audits

The December 2021 VA OIG audit uncovered several issues with the acupuncture claims that had been paid in 2018 and 2019:

• Lack of Authorization: Approximately 51,200 claims lacked the necessary pre-authorization from the VHA. The VA’s financial services system automatically paid for all claims within a year of authorization leading to overpayments for unauthorized services; including the number of visits in excess of the authorization, dates of service after the allowable dates on the authorization, etc.
• Documentation Deficiencies: About 76% of the claims lacked proper documentation. The OIG found that many claims were not supported by medical documentation meeting VHA requirements, including illegible or incomplete records. The VA requires that claims conform to Medicare’s billing requirements.
• Incorrect Billing for E/M Services: Some Evaluation and Management (E/M) services billed were not fully supported by medical records or illegible, leading to further issues with claims.
• VHA Staff Failed to Follow Reauthorization Guidelines: The VHA failed to evaluate the efficacy of non-VA care prior to reauthorizing additional acupuncture services, thus improper payments were made with faulty authorization.

Lessons Learned from VA OIG’s Acupuncture Audits

1. The acupuncturist is responsible for medical necessity and documentation.
2. You must adhere to authorization limits – make sure that the services provided are administered by the provider listed on the authorization and limit the services to the amount of treatment and within the time period authorized by the VA.
3. Correct Coding: Follow the AMA CPT Codebook for accurate coding of services.
4. Maintain Legible Documentation: Ensure all documentation is clear and legible to avoid claim denials based on poor record-keeping.

Current Enforcement Trends

Followingthe VA OIG acupuncture audit report there have been a large number of resulting provider audits and investigations, in an attempt to recoup some of the funds that were paid in 2018 & 2019. The audits are being performed by the VA, third-party administrators and even the U.S. Department of Justice. You may receive a subpoena requesting claims information including progress notes or your entire case file on a group of VA patients as the initial indication of a pending investigation. Following transmission of these documents, you may be informed of several possible results. You may be subject to administrative recoupment which simply requires you to repay improperly paid funds. Common issues include unauthorized services or incomplete/illegible documentation. In more extreme instances the VA or DOJ may pursue you for civil damages pursuant to the False Claims Act. Providers may face significant penalties under the False Claims Act for knowingly submitting false claims. The DOJ often handles these cases, pursuing treble damages and substantial fines. If the investigation finds that your conduct may rise to the level of health care fraud you may be subject to criminal liability.

New Challenges: Veteran Interviews and Documentation Issues

Recent developments indicate that the VA is now interviewing veterans to challenge the validity of acupuncture claims. This new approach includes questioning whether treatments were actually received and undermining the claims made by acupuncturists. Notably, progress notes are increasingly being deemed insufficient evidence of treatment completion, particularly where legibility is an issue.

Recommendation: To counteract these challenges, we are advising acupuncture providers to incorporate an attestation form for patients to sign at each appointment. This attestation should confirm that the treatment was received and can serve as additional documentation to support the claim.

What This Means for Acupuncturists

1. Increased Scrutiny: Providers with high billing amounts are under heightened scrutiny. The VA’s focus on these cases, combined with DOJ investigations, means that billing discrepancies or errors can lead to severe legal repercussions.
2. Potential Penalties: The DOJ’s pursuit of treble damages for improper claims under the False Claims Act can lead to substantial financial penalties, significantly exceeding the original claim amounts.
3. Proactive Measures: To mitigate risks, acupuncture providers should review and strengthen their compliance practices. This includes ensuring all treatments are pre-authorized, maintaining comprehensive and accurate documentation, and using additional patient attestations to confirm treatment receipt.
4. Seek Professional Advice: Engaging with healthcare compliance specialists or legal advisors is crucial. These professionals can help navigate the complex regulatory landscape and ensure your practice remains compliant.

Conclusion

With the expanding coverage for acupuncture services and the rise in audits by federal, state, and private payors, acupuncturists must be vigilant. Reviewing and updating medical necessity, documentation practices, and billing procedures is crucial. By adhering to regulatory requirements and maintaining thorough records, providers can better manage audit risks and continue to offer valuable care to veterans with confidence.