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Watchdog Scrutinizes Medicare Telehealth Billing During Pandemic

Sept. 7, 2022, 7:59 PM

The Biden administration should strengthen its oversight and education of Medicare telehealth providers, particularly those suspected of improper or fraudulent billing practices, a federal watchdog agency recommended Wednesday.

A report by the Department of Health and Human Services’ Office of Inspector General found 1,714 telehealth providers—that billed Medicare nearly $128 million during the first year of the Covid-19 pandemic—posed a “high risk” to the Medicare program.

All of the providers “had concerning billing on at least 1 of 7 measures we developed that may indicate fraud, waste, or abuse of telehealth services,” the report said. “All of these providers warrant further scrutiny. For example, they may be billing for telehealth services that are not medically necessary or were never provided.”

While the report did not confirm that any provider was engaging in fraudulent or abusive practices, it echoed growing concerns about possible waste, fraud, and abuse in telehealth services, which were expanded under Medicare during the Covid-19 pandemic. During this time, the report notes, the Centers for Medicare & Medicaid Services also temporarily halted several program integrity activities, including medical reviews of claims. In a companion report, the OIG found telehealth usage exploded during the first year of the pandemic with more than 28 million, or about 40% of Medicare beneficiaries, using the services that first year.

The report on billing practices analyzed Medicare claims data from about 742,000 providers who billed for a telehealth service from March 1, 2020, to Feb. 28, 2021.

It found more than 670 providers improperly billed Medicare “for both a facility fee—also known as an originating site fee—and a telehealth service for more than 75 percent of their telehealth visits,” or about 148,000 visits totaling more than $14.3 million, the report said.

“A provider should not bill for both the facility fee and a telehealth service for the same visit,” the report added. “Billing for both would mean that the provider and beneficiary were at the same physical location when the telehealth service was provided; therefore, the provider is not allowed to deliver a telehealth service. Although some providers may be billing this way in error, others may be billing this way to inappropriately maximize their Medicare payments for each visit.”

Additionally, 991 of the 1,714 providers belonged to a medical practice with at least one other provider “whose billing poses a high risk to Medicare,” the report said. “This may indicate that certain practices are encouraging such billing among their associated providers.”

Questions About ‘Incident to’ Billing

The report also raises questions about a Medicare billing practice known as “incident to” billing, which “allows services provided by clinical staff who are directly supervised by a practitioner to be billed under the supervising practitioner’s identification number.” The practice obscures the person who actually delivered the services, which “is critical to program integrity efforts.”

The OIG recommends that the CMS: strengthen monitoring and targeted oversight of telehealth services; provide additional education to providers on appropriate billing for telehealth services; and improve the transparency of “incident to” services when clinical staff primarily delivered the telehealth service. The agency also called on the CMS to identify telehealth companies that bill Medicare, and “follow up on the providers identified in this report.”

In a response letter, CMS Administrator Chiquita Brooks-LaSure agreed to follow up on these providers. “CMS will review the providers identified as posing a high risk to Medicare against those telehealth providers already identified by CMS, and within the context of the larger program integrity strategy. If necessary, CMS will follow up as determined appropriate,” Brooks-LaSure said in a letter.

Her letter added that the providers and Medicare payments identified in the report represent “approximately two tenths of a percent of all providers who billed for telehealth and approximately 2.5% of all Medicare FFS payments for telehealth services.”

“Given that this report was conducted outside of CMS’s and law enforcement entities’ program integrity efforts, CMS will need to carefully review the issues identified to assess whether these issues have already been addressed, and if not, whether additional CMS actions are needed,” Brooks-LaSure said.

She added the CMS has provided educational material and one-on-one provider instruction when needed. “CMS will analyze OIG’s data and determine whether additional education, including one-on-one education, is necessary/"

To contact the reporter on this story: Tony Pugh in Washington at

To contact the editor responsible for this story: Brent Bierman at