Care Plans that Take Total Control of How the Insurance Companies Look at Your Practice

Over the past few years it has mainly been Medicare carriers, CERT reviewers and the Office of Inspector General as the main watchdogs to create havoc within the profession performing post payment reviews and going into offices to retrieve patient files. And, this activity is bound to increase as the Recovery Audit Contractors get settled into their roles and start looking at medical necessity claims. As if the problem wasn’t bad enough, over the past few months I have come across an alarming number of reviews from the private major medical insurance carriers that have requested dollar amounts repaid in the hundreds of thousands. But, these reviews are different because they were triggered by similar processes, only for a different reason. I was in the Carrier Advisory Committee with Palmetto GBA, I had the opportunity to work with nurses and to understand the triggers for Medicare audits first hand. These audit requests were based mainly on medical necessity and percentage of utilization rate of the CMT codes (98940, 98941 and 98941). This type of approach from a Medicare carrier shouldn’t be a surprise because of the restricted number of treatment codes we are currently allowed to be reimbursed for from CMS.

But, when it comes to private major medical insurance carriers the landscape of what is a covered service changes dramatically. This is simply because their policies usually allow for more services to be covered than just the CMT. Because of the extreme differences between the types of coverage, it is important to take additional information into account when trying to calculate your practice’s risk.

This should be in the forefront of your mind when figuring out both during the constructing a patient’s plan of care and when calculating the patient’s financial responsibility.

This type of thought process is not hard to go through. In fact, it can be made simple if we look in the right place and adopt the policies that the insurance companies have used against providers. The carriers have used these rarely viewed online policies to create documentation requests and their subsequent audit demand letters requesting previously disbursed funds be returned.

For example, if you pull down Cigna’s chiropractic coverage policy, you will find an interesting point that never comes up when dealing with Medicare. It states: “The provider should attempt to integrate some form of active care. Continued use of passive care modalities may lead to patient dependency and should be avoided.” But, you may think to yourself… “Why is all of this important, and to whom? My patients get better and they love me!” Even though you care about your patients very much, the fact that your patients “get better” at times can be irrelevant to the carrier. The reason is, the carrier still has a fiduciary duty to only pay for services that only take place within the terms of the contract, regardless of the patient’s outcome.

That may sound unfair, but this issue has been taken up in court numerous times. In 1993, Dettmer Clinic v. Associated Insurance, a chiropractor sought reimbursement for rendered services denied on medical necessity grounds. The US District Court for the Northern District of Indiana upheld the insurer’s right to determine medical necessity, regardless of what the treating physician’s opinion. In this Cigna example, there is a requirement that the doctor should integrate some form of active rehab into the patient’s care plan so as to not make them dependent upon passive modalities. And, because of this statement, it is imperative to understand what happens to your practice profile when you construct your patient’s care plan and their portion of what they are going to be required to pay.

The reason is simple but it is hidden away from the public eye and contained within the context of audits that I previously mentioned which are taking place. These audits are not based on medical necessity as much as they are based on the provisions within the “unknowingly updated” contract the provider had previously signed years in advance. In other words, the review is in essence a “Contractual Audit.”

A “Contractual Audit” is a post-payment review based on the premise that the provider’s billing history shows a possibility of non-compliance with the provider’s contract requirements. When this happens, the discussion between the provider and insurance company is never about medical necessity but whether or not the provider followed all of the rules contained within the contract itself. For example, the question we have to ask ourselves when one of our patient’s presents with Cigna insurance is, “Must we incorporate active rehab (when clinically appropriate) into the patient’s plan?”

If you compare active rehabilitation to “MUSH” (Massage, Ultrasound, Stim and Heat), the rehab creates a patient that can better handle their ADL’s (activities of daily living) and reducing the chances of further injury, therefore costing the carrier less over time. When you combine that information with the current research states that the use of passive therapies should be used for pain control, from the carrier’s perspective, it makes sense to create this type of policy to limit the amount of time a patient receives passive therapies. Knowing all of this, we should want to move the patient from passive modalities to active rehab, especially when the typical chiropractic patient has their pain complaint resolved a long time before their endurance or strength has returned to pre-injury status.

Please understand that this does not mean that you MUST do the rehab yourself.

What the carrier is asking for is much simpler and, at times, cheaper than an order to actually DO the rehab in your office. What they are looking for is for the patient to have some sort of activity included in their plan that would increase strength and flexibility. The easiest way to do this is to add the home exercises into the patient’s treatment plan and then make it a point to review the home exercises when the patient returns for their regular adjustment visits. To help with this, there are great tools out there for the provider to give you more patient oversight of the patient’s progress, like or, where you can create protocols to ensure the right exercise for the proper condition.

In most cases, when this isn’t done, the carrier can tell just by looking at the claims that have been submitted for reimbursement, which explains how some practices get picked for an audit. In fact, the process is very simple, because all the carrier has to do is take a look at the types of services billed and compare them to the onset date for the current condition. The carrier will pay for these services for a while, expecting that the patient may have a complicating factor for some type of extenuating circumstance that would require long term passive therapy. But don’t be worried about the one case you might have that requires this type of treatment because, if your profile shows that you don’t repeatedly continue to use passive therapies, having one outlier would not raise a red flag.


Dr. John Davila is a 1994 graduate of Palmer College of Chiropractic in Davenport, IA, and practiced in the Myrtle Beach, SC, area for 13 years. Since 2000, he has been consulting with insurance companies and doctors in private practice in the areas of coding and documentation. In 2001, he re-wrote the Medicare LCD chiropractic coverage policy for Palmetto GBA (SC Medicare). His company, Compliant Services & Solutions, Inc., helps doctors of chiropractic to ethically maximize their practices, while avoiding audits and repayments to insurance carriers. You can reach Dr. Davila, toll free, at 1-877-322-6203 or by email at [email protected] or on the web at

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