Govt: Medicare paid $47 billion in suspect claims

[DEDixon 39]

WASHINGTON – The government paid more than $47 billion in questionable Medicare claims including medical treatment showing little relation to a patient's condition, wasting taxpayer dollars at a rate nearly three times the previous year.

Excerpts of a new federal report, obtained by The Associated Press, show a dramatic increase in improper payments in the $440 billion Medicare program that has been cited by government auditors as a high risk for fraud and waste for 20 years.

It's not clear whether Medicare fraud is actually worsening. Much of the increase in the last year is attributed to a change in the Health and Human Services Department's methodology that imposes stricter documentation requirements and includes more improper payments — part of a data-collection effort being ordered government-wide by President Barack Obama next week to promote "honest budgeting" and accurate statistics.

Still, the fiscal 2009 financial report — covering the first few months of the Obama administration — highlights the challenges ahead for a government that is seeking in part to pay for its proposed health care overhaul by cracking down on Medicare fraud. While noting that several new anti-fraud efforts were beginning, the government report makes clear that "aggressive actions" to date aimed at reducing improper payments had yielded little improvement.

In recent years, the suspect claims have included Medicare prescriptions from doctors who were dead, and requests for payment for medical supplies such as blood glucose strips for sexual impotence and diabetic shoes for leg amputees. Patients, many of them new citizens who barely speak English, are sometimes recruited by brokers who go door-to-door offering hundreds of dollars for use of their Medicare numbers.

Obama is expected to announce new initiatives next week to help crack down on Medicare fraud, including a government-wide Web site aimed at providing a fuller account of health care spending and improper payments made by various agencies. The Centers for Medicare and Medicaid Services also will launch a Web interactive next month that will allow users to track Medicare payment information by categories such as state, diagnosis and hospital.

According to the report, the Bush administration from 2005-2008 reported improper payments of roughly 4 percent in the fee for service program, or about $17 billion total in 2008. Government officials at the time, however, typically did not consider a Medicare payment improper if the medical documentation was incomplete or a doctor's signature was illegible. Since these were flaws that ordinarily bar payment, that methodology drew complaints from government auditors that the figures were understated.

For fiscal year 2009, the Obama administration began counting those claims as improper, but was unable to complete an official tally based on the new methodology. As a result, it officially reported improper payments for its fee for service program at 7.8 percent, representing a partial tally under the new formula. But it considers the unofficial tally of 12.4 percent to be more representative.

Beginning next year, the 12.4 percent figure — or a total of $47 billion in improper payments when counting both Medicare fee for service and managed care — will be used as the baseline estimate. The federal report sets a target of reducing improper payments in the fee for service program to 9.5 percent by next year, which would represent a savings of roughly $9.7 billion.

The findings come as the Obama administration is making Medicare anti-fraud efforts an important priority. In recent months, HHS has said it was multiplying by 10 the number of agents and prosecutors targeting fraud in Miami, Los Angeles and other strategic cities where tens of billions of dollars are believed to be lost each year. The new partnership seeks to have better sharing of real-time intelligence data on health care fraud patterns.

Officials say they also want to increase training and outreach among Medicare providers to reduce documentation errors, while proposed health overhaul legislation would increase background checks on Medicare claimants and impose stiffer penalties for false claims.

Other findings:

_In the Medicaid program for the poor, roughly $18.1 billion, or 9.6 percent of claims, are believed to be improper payments.

_Using a baseline of 12.4 percent in improper payments in the Medicare fee for service program, HHS is setting targets of reducing fraud and waste to 9.5 percent, 8.5 percent, and 8.0 percent, respectively, for fiscal years 2010 through 2012.

Records released earlier this week showed that CMS for three years ignored internal watchdog warnings about swindlers stealing millions of dollars by scamming several Medicare programs. The agency received roughly 30 warnings from inspectors but didn't respond to half of them, even after repeated letters.

http://news.yahoo.com/s/ap/20091114/ap_on_..._medicare_fraud

[Mr. Big Dog 10,747]

So, there's your 400+ billion over a decade to help pay for the health care reform w/o actually cutting any benefits. The other interesting point to take away from this is that despite this waste, Medicare has a lower per enrollee cost growth than private health insurance. Now tell me again what value the private insurers actually add to the health care system.

Interesting read on the waste that makes our health care system so freaking inefficient and expensive:

How to Save Billions On Health Care Now

Dr. Jon LaPook Looks At Remedies To Ballooning Health Care Costs

By Jonathan LaPook, M.D.

(CBS) President Obama has stressed the importance of "bending the cost curve" in order to put the brakes on galloping health care expenses that total $2.5 trillion a year and are increasing at six percent a year. The fastest way to do this is shockingly simple: carefully explain to patients the known risks and benefits of procedures.

Dr. Elliott S. Fisher, Director of Dartmouth's Center for Health Policy Research, estimates that 30 to 40 percent of elective procedures are unnecessary. This includes elective angioplasty ($16,000), spinal fusion ($22,300), knee replacement ($14,400), and hip replacement ($15,700).

And it's not just costly procedures that are ballooning our health tab; the annual price for diagnostic imaging studies such at CT's and MRI's is about $100 billion, roughly 35 percent of which is estimated to be wasted.

A prime example of an overused procedure is angioplasty, which opens up clogged arteries in the heart. Over a million are performed every year in the United States. Most patients believe it will prevent a heart attack and prolong life. But that's only true if the procedure is performed when a patient is actually showing signs of a heart attack. In elective cases which, according to the American College of Cardiology's National Cardiovascular Data Registry, account for 37 percent of angioplasties, it has not been shown either to prevent heart attack or prolong life. For a segment that aired last June on the CBS Evening News with Katie Couric, cardiologist Dr. Steven Nissen of the Cleveland Clinic told me, "Cardiovascular interventional procedures are big money makers for hospitals and for practitioners." For a lot of doctors, "it's tough to walk away from that."

Our fee-for-service payment system certainly creates perverse incentives for doctors, a major reason for the spiraling cost of health care. But there is another factor that is more insidious: the reluctance of physicians to accept new evidence about the medicine they practice. For example, doctors have been taught for many years that an open artery is always better than a closed one. Despite convincing data showing that this simply isn't true, many physicians remain unconvinced and refuse to change their behavior.

When I interviewed President Obama about health care in July, I asked him about unnecessary elective angioplasties and the friction between what a physician believes to be true and what is supported by evidence-based medicine. He replied, "I have enormous faith in doctors. I think they always want to do the right thing for patients. But I also think, if we're honest, doctors, right now, have disincentives to making the better choices in the situations you talked about. If you are getting paid more for the angioplasty, then that subconsciously even might make you think the angioplasty is the better route to take. And so if we're reimbursing the physician not on the basis of how many procedures you're performing but rather how are you caring for the patient overall - what are the outcomes - then I think you start seeing some different choices."

Trying to figure out which medical interventions actually work is the whole point of the so-called "comparative effectiveness" studies for which Congress has budgeted $1.1 billion. There has already been good progress in this kind of research. Aside from data showing that elective angioplasties don't save lives, a recent study found that vertebroplasty, a common procedure to treat pain from back fractures, was no better than a placebo treatment with a shot to temporarily numb the area.

Ultimately, insurers will try to change behavior by refusing to cover services that have performed poorly in comparative effectiveness research. That strategy will likely take years to implement and will be complicated by the fact that medicine is both an art and a science and will never be able to be reduced to perfectly predictable algorithms. Clinical judgment and even what has recently become a politically incorrect term - intuition - will always play an important role.

So how do we save billions starting now? By doctors and patients agreeing to discuss carefully whether procedures and tests are worth it.

This will have to involve consent forms. A review of hundreds of these forms at more than 150 hospitals found them to be of "limited value." They are loaded with confusing language, often omit specific risks and benefits, and are generally not well explained by doctors. Patients often sign the forms minutes before a procedure without even reading them. Experts such as Dr. Fisher say that 30-40 percent of unnecessary procedures could be eliminated through proper informed consent - what is increasing being called "informed patient choice" to emphasize that doing the suggested procedure is not a foregone conclusion.

Gerry O'Connor, PhD, Associate Dean for Health Policy and Clinical Practice at the Dartmouth Hitchcock Medical Center, has implemented a pilot program that personalizes the consent process. In the case of angioplasty, the physician collects detailed medical information about a patient, then searches a database of angiogram results to estimate individual risks and benefits by finding out what happened to similar patients who had the same procedure.

"It's not generic," he told me. "It's for people like you. If we get that right, we'll create a better informed consent."

Ultimately, electronic medical records will connect with electronic medical knowledge, including comparative effectiveness results, to give doctors and patients information - so-called "decision support" - at the moment a test or procedure is electronically ordered. But until then, and starting immediately, doctors and patients can try the low-tech solution of setting aside enough time to weigh adequately the pros and cons of medical options - not just for procedures but for other treatments and diagnostic studies. Of course, this is more easily said than done in a system that reimburses far better for doing things to patients than for communicating with them. That must change.

In this week's CBS Doc Dot Com, I talked to Trudy Lieberman, the director of the health and medicine reporting program at CUNY's Graduate School of Journalism. She also blogs on health reform for the Columbia Journalism Review.

Click here to watch the segment:

Edited November 15, 2009 by Mr. Big Dog