How to Avoid Pass-Through Billing Pitfalls in 2022 & 2023

Charging for specific services that an independent medical contractor provides is an illegal act by a medical clinic. We have thoroughly described pass-through billing and how it can affect the billing business. Learn about certain steps to avoid pass-through Billing.

What Is Pass-Through Billing?

When a reference laboratory and a physician practice collaborate on pass-through Billing, the physician can send samples to the reference laboratory for testing, pay the reference laboratory directly, and then bill the patient or the insurance company for the medical test-typically at a higher cost known as Past-Through Billing. Billing providers increase their profit by charging for services they didn’t even perform.

This is an illegal act and can also hurt the practice’s credibility. Although to avoid these situations, healthcare organizations now rely on experienced companies to provide medical Billing and coding services.

JAMA Network published a study; in this study, it is stated that around $58.5 to $83.9 billion get wasted due to medical fraud and abuse, which increases the healthcare total cost.  Pass-through Billing has serious effects, taking preventive measures is important so you don’t fall into this trap.

It’s important to know the difference between what is pass-through Billing and what is not. According to the American Medical Association, healthcare professionals charge for additional services that aren’t even performed just to increase their cost; it’s a crime.

Besides that, this practice is unethical. It conflicts with insurance laws and adds to the burden on the healthcare system.

Ways to Avoid a Trap

It is observed that pass-through billing mostly occurs in rural healthcare facilities, as they do not generate considerable revenue; that’s why they participate in fraudulent billing schemes to increase their revenue by claiming reimbursements for the services they don’t even perform.

This problem is spreading rapidly throughout the U.S, but by developing a compliance program, you can easily avoid this trap. The Centers recommend for Medicare and Medicaid Services (CMS) that you don’t need to follow the Compliance Program; however, implementing it does reduce the threats of unlawful conduct.

  • Implementation of The Compliance Program
    An effective compliance program can easily deduct any error in Medical Billing and coding and decrease the risk of penalties in your medical practice. The incredibility of your work can also increase by it.
  • Infrastructure for Medical Billing
    An effective medical billing infrastructure that complies with the APC and supports your in-house Billing can increase your readability and accuracy. In addition, it is highly recommended that medical providers invest and work on training their staff and resources to produce high-level maintenance.
  • Get to know the Rules & Regulations
    According to the Office of General Inspector (OIG), getting familiar with the rules and regulations is another way to avoid the trap. The illegal billing issues and frauds in Medicare, Medicaid, and other Federal Healthcare programs are carter by OIG. You get aware of the illegal billing practices by getting engaged with OIG rules. By focusing completely on medical coding, documentation, and other medical rules, you can ensure that you work under the rules and regulations defined by OIG.
  • Documentation
    You must completely document an unlisted cost and use a single code for injections for a single session rather than coding it many times.

In medical coding, mix-ups can also lead your practice toward fraud. It is essential to take steps to bill your medical services perfectly. Keep accurate documentation of codes up-to-date so you can properly and accurately bill for the services you offer.

Upcoding As Bad Practice

In medical coding, upcoding is also considered an unethical practice. Upcoding means billing a patient for a few minutes to meet up under the full session. There are situations when the relevant authorities can easily overlook upcoding, but you could suffer severe repercussions if found. Following the National Correct Coding Initiative (NCCI) guidelines while reporting medical coding is another item to keep in mind to prevent coding errors that can result in medical billing fraud. Employing pertinent and trustworthy coding techniques enables you to report medical payments accurately.

Remember that pass-through Billing, including Billing for Medicare, is illegal and unethical. It’s simple to get caught and be charged with major crimes. Pass-through medical billing practices and other in-house Billing and auxiliary services may seem similar and unethical to you and can often be hard to tell apart.

If you have any uncertainties, it is always preferable to consult a medical attorney. Additionally, you should train your personnel and acquire them with medical norms and regulations if you want to prevent falling into pass-through traps.

Relevant Laws for Pass-Through Billing 

The pass-through Billing is conducted under these three laws:

False Claims Act: This statute forbids the government from marketing subpar and inferior goods and services.

The Anti-Kickback Statute: It is a criminal statute that primarily forbids receiving and paying for patient referrals and generating business funded by the federal health care system.

The Physician Self-Referral Law: Sometimes known as the Stark Law, forbids doctors from referring patients to organizations that work closely with them to receive medical care.

End Note 

Pass-Through Billing is a shameful practice that should be avoided at any cost. Federal interrogation authorities maybe take legal action against such tactics.

Sometimes, it becomes difficult to differentiate between pass-through Billing and genuine medical claims. If you are unsure about anything or want to grasp what pass-through Billing entails fully, you should see a medical attorney. Furthermore, you should confirm compliance with government programs to prevent pass-through Billing for labs.

Additionally, inform your team of the most recent rules and practices regarding medical Billing.

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