Hello, everyone.

Yesterday, the Office of Inspector General released a report titled
"Chiropractic Services in the Medicare Program: Payment Vulnerability
Analysis." The OIG found that approximately 67 percent of the chiropractic
services allowed by Medicare in 2001 did not meet Medicare coverage criteria
and/or were miscoded, or were undocumented, potentially costing the program
and its beneficiaries approximately $285 million. A copy of the report can
be found on the OIG Web site here:
http://www.oig.hhs.gov/oei/reports/oei-09-02-00530.pdf

Obviously, ACA takes issue with the report, and we've put together a preliminary statement on the report, which can be found directly below. We will be analyzing the report further and then distributing a more in-depth analysis
as soon as possible.

We've already received a call from the Associated Press (resulting story at very bottom of email below ACA's statement) on this report and anticipate more inquiries in the days to come. We will keep you posted as to any further developments.

* * * * *

Angela Kargus
Communications & PR Manager
American Chiropractic Association
1701 Clarendon Blvd.
Arlington, VA 22209
P: (703) 276-8800
F: (703) 243-2593
akargus@amerchiro.org
www.acatoday.com

Inspector General Medicare Report Based on Outdated Information,
Misrepresents ACA's Position on Frequency Limits

The ACA is currently reviewing the report released June 21, 2005, by the
Office of the Inspector General. It is important to note that data reviewed
in this report were taken from 2001. Since that time, the ACA has taken
steps to reduce chiropractic error rates, including the release of a
comprehensive documentation manual and increased education of its members.
In addition, as of October 2004 doctors of chiropractic together with the
Centers for Medicare and Medicaid Services (CMS) implemented the use of the
Active Treatment (AT) modifier to reflect claims for active/corrective
treatment. The ACA believes that these proactive measures will positively
impact the results of future error reviews.

Furthermore, contrary to what is suggested within the report, at no time has
the ACA ever expressed support for a national frequency cap on chiropractic
services. In fact, the ACA fought diligently to block the CMS proposal that
would have allowed insurance carriers to begin to impose arbitrary caps on
chiropractic services received by Medicare beneficiaries. Copies of
correspondence between ACA and the Health Care Financing Administration (now
known as CMS) regarding frequency caps can be found at www.acatoday.com.

A more detailed analysis of the OIG report will be posted on the ACA's Web
site as soon as it is available.


Taxpayers Overbilled for Chiropractic Work

By KEVIN FREKING
The Associated Press
Tuesday, June 21, 2005; 5:35 PM

WASHINGTON -- In one year, the government paid chiropractors for nearly $285 million in services that should not have been billed to Medicare, an inspector general's report said Tuesday.

Since 2001, the year studied, the demand for chiropractic services has increased. To prevent abuses, caps should be placed on the number of times that Medicare could be billed for chiropractic services for a patient, Health and Human Services' inspector general said.

"The need for a more effective way to eliminate inappropriate maintenance payments is crucial," the report said.

The questionable payments in 2001 amount to $2 out of every $3 that Medicare spent on chiropractic services that year. The payments were improper because they reimbursed providers for treatments that failed to meet the government's criteria for medical necessity, or because providers lacked the proper documentation to prove the services were needed, the report said.

The American Chiropractic Association, noting that the data cited by the IG's office is four years old, said the government instituted new procedures last year designed to help chiropractors avoid improperly billing the government. Medicare will reimburse for manipulation of the spine that is designed to improve a chronic or acute condition, but it is not supposed to reimburse chiropractors for simply maintaining a health condition.

The vast majority of improper payments, or $251 million, was for maintenance, the IG said.

"The procedures were put in place not quite a year ago, and it's intended to address the very problem they're talking about in this report," said Thomas Daly, a lawyer with the association, which represents about 12,000 chiropractors. "They wouldn't have the statistics to report whether it's having an impact or not. That's why we're a little mystified why they didn't go into what's happening now."

Daly said the association disagreed with the IG's recommendation that the government cap the number of times that it will pay for chiropractic services.

"We think an appropriate test is whether those services are reasonable and necessary," Daly said.

The inspector general's office said taxpayers could realize significant savings from the caps.

"When chiropractic care extends beyond 12 treatments in a year, it becomes increasingly likely that individual services are medically unnecessary," the report said.

IG's office: http://www.oig.hhs.gov

American Chiropractic Association