Archive for August, 2008
It is no secret that there are some serious issues that need to be addressed regarding Medicare. Lawmakers are looking for financial solutions, auditing solutions, quality control solutions and other changes to make sure that the Medicare system becomes sound again and is there to support seniors when they need it.
There have been problems with fraudulent and erroneous claims front and center in the news lately. On top of Medicare paying out billions of dollars that should not have been paid out for claims from phony doctors and patients for phony equipment and services, the Centers for Medicare and Medicaid Services (CMS) has been using their own Medicare officials to do the audits to figure out what types and amounts of fraud were actually perpetrated.
The lawmakers and oversight commissions have come back and stated that the Medicare auditors actually were not the right auditors for the job, were not following the strict guidelines regarding audits and, in the end, needed to be audited themselves because their figures were not accurate. Without following the correct guidelines, much of the fraud was missed. In addition, sending someone from their own agency to audit themselves isn’t a real effective or efficient way to find errors or fraud.
Currently, there are more issues that have arisen. One issue that has created problems for years is the sluggishness of the claims process and the payment process. Medicare beneficiaries and their medical providers are frustrated as they wait month after month for claims to be paid while expenses pile up, making it hard for everyone involved.
The latest situation – which has cost Medicare more money that it doesn’t have to spare and didn’t need to spend – involves overpayments for medication. Because the Medicare system is so slow, Medicare missed the opportunity to pay for less expensive generic drugs rather than brand names. Medicare was so far behind that they did not enter the generic alternatives into their computer systems when they became available, thus paying the higher prices.
One of the main medications, a cancer drug, was paid for at double the generic price because of a two-month delay in entering the new information into the system. The system had no idea that generics were even available for this particular medication, according to the inspector general’s office. There are also overpayments for other drugs that have generic counterparts.
With Medicare’s financial woes, they should be at least working faster to save themselves money. When confronted with the information about the overpayment, Medicare acknowledged that they should input information in a timelier manner so that it will reflect current market prices.
With lawmakers and others trying to save Medicare, it’s time for Medicare to help save itself.
For years we have heard about the plight of seniors on very meager incomes who have to rely on Medicare and Social Security to survive and who have had to buy second-rate food – or even dog/cat food – so they can eat.
Medicare has been designed to help seniors with their medical expenses, especially prescriptions. The prescription drug coverage, a supplement to Medicare, is essential to seniors, as much of their ongoing healthcare is dependent on their medication.
This part of the Medicare coverage available should actually be the easiest to deal with. No doctor, no hospitals, no tests, just medicine. However, with the changes to Medicare, especially with Medicare Advantage on the scene, things have gotten somewhat dicey in the area of seniors and prescriptions.
On the surface, Medicare Advantage is a good idea, but once you look into it, there re dangers lurking just a little below the surface. These dangers can leave seniors extremely vulnerable, because once seniors have reached a particular amount of coverage/paid claims for prescriptions, the bottom drops out.
What happens is that if a senior has a Medicare Advantage plan that pays up to $2500 in prescriptions, once they hit that amount, they must pay for further prescriptions out of their pocket – often to the tune of thousands of dollars. Once they reach the next plateau, coverage kicks in again.
The problem with this situation is that if a senior on Medicare Advantage has spent the initial allotment of coverage for prescriptions in the month of August, they will be paying for medication out of pocket possibly for the rest of the year. Many times, the cost of medication is more than their entire Social Security check or entire income that month.
Because of this, too many seniors are simply going without medicine. Imagine being on insulin or heart medication. How long could a senior with diabetes or a history of heart disease go without their medication before there are serious complications, or even fatal ones?
Lawmakers are trying to fix Medicare. This is one area where they have to pay close attention. In the meantime, physicians can try to work with their patients on Medicare to prescribe generics – especially those that are $4 on many pharmacy plans – so that seniors don’t have to risk their health and their lives by going without.
It seems like Medicare continues to have more problems when it comes to keeping records, fraud and audits. We recently reported that there had been an inspection by the Inspector General’s office regarding overpayments, payments for false claims and fraud. That investigation, by the Human Services inspector general’s office originally uncovered what seemed to amount to about $700 million.
The Medicare Officials that conducted the investigation gave these figures. There is only one problem – the information was based on faulty statistics. In fact, the way that Medicare officials conducted the investigation went directly against Medicare rules.
What was supposed to happen was that the billing be matched against purchases, medical records and orders from doctors. They were not handled this way. They were matched against purchases, but limited medical records in only some of the cases and they were essentially not matched against orders from doctors at all. The end result is that many phony purchases were matched against phony billing, leaving much of the substantiating information out of the equation.
As a result of the way that this was handled (remember the fox watching the hen house), Medicare officials investigated their own information and came out with a faulty figure. They determined that the $700 million in fraud that they gave as their figure amounted to about a 7.5% fraud rate.
When looking at the true figures, however, it is actually estimated that the total amount in fraud is actually over $1 billion. The federal report said that if the Medicare officials had made the auditors abide by the rules, the amount of incorrect or fraudulent billing would have been much higher, resulting in the $1 billion mentioned.
With Medicare having the financial problems that we continue to hear about, $700 million was bad enough. Now we are looking at $1 billion. It seems that $1 billion would pay for a lot of prescriptions that the Medicare Advantage donut hole is swallowing up.
Reports have recently revealed that Medicare prescription drug supplements are not being watched very carefully. In fact, there is a fraud prevention program that is supposed to be in effect to deal with the prescription drug coverage offered by private insurance companies.
The Government Accountability Office holds CMS responsible for monitoring and auditing the $39 billion prescription drug programs. That is a great deal of money that could easily be misused. The GAO examined five plans that are unnamed and created a report detailing the shortcomings regarding what CMS is responsible for.
Some of the oversight responsibilities that have not been adhered to by CMS include establishing training programs for employees so that they can recognize fraud and misuse of relevant laws. Only two of the five programs have established such training.
CMS states that though they did not have the training in place, the programs did establish written standards for detection and prevention of fraud and waste. The GAO has strongly suggested that CMS should conduct audits of the prescription drug programs.
CMS says that they have asked the programs to produce self-assessments – (remember the fox watching the hen house, again?) – and said they would use the self-assessment surveys in place of audits for now. They said that they are focusing on complaints, especially since their audit budget was capped at $720 million, stating that this restricted amount makes it difficult, if not impossible, to conduct proper auditing.
This attitude toward auditing fraud, coupled with the fact that CMS has not developed even a streamlined auditing system, might be saving Medicare some tightly budgeted money in the short term, but the billions that are being taken out of Medicare while officials are ignoring the problem, could be saving the country and its Medicare beneficiaries billions. This might be enough to eliminate some of the unaffordable and superfluous supplemental programs and create a Medicare system that is affordable and works for everyone.
Medicare has been working to start making sure that hospitals deliver better results for their patients. They have been studying the numbers of readmissions, deaths and other outcomes in over 4,000 hospitals throughout the country. The studies are a precursor to rewarding hospitals for good performance by possibly offering bonuses versus paying hospitals at a lower rate if they need to improve their performance and outcomes.
The Medicare information released focuses on the number and percentage of patient deaths during or after a hospital stay or readmission. This monitoring is good news for patients because it has “encouraged” hospitals to improve services.
Some of the improvement measures that hospitals have reported using for better outcomes have been better monitoring, more careful use of catheters and other instruments that can create and spread infections, such as staph infections which can be fatal, better information to patients when they are about to be released, and better follow-up including phone calls to patients once they have gone home.
The hospitals that saw improvement in outcomes reported using many of these measures. The hospitals that did not fare quite as well agree that there is room for improvement, but they – and others – cite some inaccurate figures and results. For instance, in one hospital that had a high number of deaths from pneumonia, 60% of the patients in that group were over 80 years old, very frail and had other medical issues and complications.
In another group of patients at one particular hospital two-thirds of them actually died in nursing homes, and most of them contracted the pneumonia after they left the hospital. Another hospital reports that over 90% of the group of patients that died of pneumonia had a “Do Not Resuscitate” order which does not give an accurate picture of the hospital’s role in their death.
The results of this study are important to be aware of, and the fact that the study was done indicates that Medicare is looking at ways to help patients be safe and receive the best quality care possible. Even while the kinks are being worked out, care is improving for patients.
As if there wasn’t enough fraud in the world today – especially in Miami – the FBI has uncovered even more. This is not your garden variety every day fraud, this fraud has been big business and cost the government and taxpayers billions – yes BILLIONS – of Medicare dollars.
While many honest citizens are working hard to pay billions of dollars for a war and other conflicts that they may or may not agree with, these individuals have stolen money that could help bolster the Medicare system, which is having some serious financial issues, in case they hadn’t heard.
It brings to mind the old question about whether you would steal from your own parents or grandparents. Apparently, these fraudsters would. In fact, not only have they done that, but by taking BILLIONS away from a system that is so badly needed by our most vulnerable citizens, they are also stealing from their own children and grandchildren. Of course, when you think about it, their parents, grandparents, children and grandchildren may not need the benefits since they will have all the money that was stolen – unless it gets confiscated by the FBI.
The way this particular scam worked, “patients” were recruited to see particular doctors. They were paid each time they went to an office visit. The clinics that these doctors work for then billed Medicare for all sorts of fraudulent services, including AIDS treatment that is not even used any more in the United States.
Medicare does not combat fraud as effectively or aggressively as private insurance companies do, even though they have received funds to do so. One of the primary reasons that Medicare is not effective at preventing fraud is that they do not have a system that prevents fraud before money is dispensed. Without a containment system at the beginning of the claims process, it is impossible to stop fraud because once the money has been paid out, it is much more difficult to get it back – especially because most of the time, the fraudsters have already left the country.
Medicare is a huge agency with an enormous budget and over 44 million people who depend on it. Fraud costs Medicare over $60 million per year. Surely there are ways to eliminate at least some of that fraud. Eliminating even half of it would fix the Medicare budget and the education budget, too.
Medicare Centers for Medicare and Medicaid Services (CMS) has been working on a pilot program for three years. The pilot program has involved over 250 hospitals and has monitored quality measures in those hospitals during that time, offering rewards for high quality.
This partnership between the hospital consortium and Premier and the CMS spent the three years working on the quality measures in the 250 hospitals that were part of the pilot. Premier reported that the results that were achieved included a 15.8% increase in quality in these hospitals that served 1.1 million patients. Premier President and CEO Richard Norling said, “The findings from the first three years of the project clearly show that transparency with rewards for quality achieves a higher level of performances in American hospitals.
This project actually brought up the performance standards of all hospitals involved to a better level, bringing those on the lower levels closer to the higher levels and closing the gap between them. This is great news, and if the pilot program works to raise quality levels in these 230 hospitals, it would be a tremendous idea to expand the program or at least use the standards and rewards in the pilot to improve quality of more hospitals throughout the country. The money saved because of the improvements of quality and efficiency could be used to fund the pilots or other programs for other hospitals in other areas across the country.
There was an announcement by Acting CMS Administrator Kerry Weems said in a statement, “Given these results it is time for us to take the next step and implement hospital Value Based Purchasing for the Medicare program, so that citizens across the nation can benefit from improved safety and quality [and] get the right care every time.”
How many times have you heard about someone coming home from the hospital after a successful operation, but they just didn’t get well. In fact, they got worse and worse until they ended up back in the hospital again. The doctors couldn’t figure out what happened until certain tests were performed and they found out that the person had an infection.
Usually, this was not just any infection. It was a severe infection, some sort of staph infection – and the biggest problem, besides the fact that these infections are extremely difficult to treat – is that it was caused by the hospital and/or the doctors that did the surgery.
Some of these infections end up in the blood stream; others affect various organs, others, such as urinary infections from catheters infect the bladder and kidneys.
It has been found that the majority of these infections can be prevented – often by doctors and the surgical team being more careful.
The issue of infections has become so prevalent that some hospitals are working on pilot programs that are trying to eliminate as many of them as possible. If the hospitals eliminate enough infections and other issues that bring people back into the hospital for another stay, they will receive bonuses from Medicare. In fact, Medicare is looking into programs that will give hospitals bonuses for better care of patients and pay them less if they have too many readmissions.
Infections can be extremely serious, or even fatal. For instance, a man in Missouri was in the hospital after a heart attack to have a pacemaker put in. Though the operation went very well, he became very ill after he returned home. The reason: a serious staph infection. The result: after 15 more surgeries and 84 days in the hospital, the man is still alive, but lost his right leg, part of his left foot, a kidney and his hearing. He just won a multi-million dollar lawsuit.
If you or someone you know has had surgery and is not getting well as projected, or is getting worse and there doesn’t seem to be an obvious reason, call your surgeon and your regular doctor. Have them test for infection right away. Insist on it. The sooner an infection is addressed, the better the chance it will heal.
Medicare will cover the cost of the hospitalization, and it might save someone else from the same situation because Medicare is beginning to look more carefully at the issue of infections – especially if a hospital has been involved in too many of them.
One tool that many researchers and oncologists feel is very useful in diagnosing and treating cancer is the PET (position emission tomography) scan. The reason the PET scan is considered an effective tool is that unlike a CT scan, it actually isolates the location of a tumor or cancer and shows whether it is spreading to other areas.
A PET scan works by using radioactive sugars which localize at the point of the cancer or tumors. When these are located, this tells an oncologist basically where the cancer is and if it is contained or spreading. Some oncologists use the PET scan in conjunction with a CT scan for clarity, since the resolution of a CT scan is clearer than the resolution of the PET scan.
All of this sounds great, right? Well, yes, except that there have been questions regarding the effectiveness of the PET scan as a useful tool. As a result, Medicare has only approved the PET scan for certain cancers for the past few years, and it has a mandatory registry that doctors must sign their patients who receive the PET scan into, so that data can be collected regarding how well the scans work.
This is important information to have, but it comes at a price: $50 per patient for the registry. In addition, since Medicare limits the types of cancer that the PET scans can be used for, this leaves out a lot of patients.
Currently, Medicare is reviewing whether more data is needed, or whether the data that the registry has collected is sufficient to determine the effectiveness of the PET. In addition, it is reviewing whether more types of cancer can be approved for diagnosis by PET scan. If so, this could help millions of individuals receiving Medicare and their physicians get to the root of the problem faster and more accurately, and start treatment.
If you are among those who are dealing with or possibly being diagnosed with cancer and you are on Medicare, check with your doctor to see if a PET scan would be helpful in your situation.
There are more and more issues surrounding saving Medicare money lately, and there are a lot of ideas swirling around to make that happen. One idea that has come to the fore and was featured in the Boston Globe is a way to help patients on Medicare, give them better service and better outcomes, and, at the same time save Medicare a lot of money – possibly half of its shortfall. Is it possible to do all these things at once? According to experts, it is.
One of the highest costs that Medicare is paying for is stays in the hospital. Most of these stays are necessary, and nobody is questioning this point. The issue at hand is that many seniors on Medicare come out of the hospital only to return again within 30 days, and in many of these cases, this could be avoided.
Research has shown that patients return for several main reasons. One reason is that they acquired an infection while in the hospital and it has reoccurred or flared up. Another reason is that they are unclear about what to do upon discharge and their condition worsens because they are not following up correctly. The third reason is that nobody has followed up with them.
Some readmissions are necessary, and nobody is disputing that fact. However, studies show that if patients were cared for differently when they were in the hospital in the first place, there would be fewer complications, such as infection, and, as a result, a lower number of patients would return. It has been suggested that if Medicare paid less for readmissions but gave bonuses to hospitals whose readmissions were lower in number, the outcomes for all parties would be better. In hospitals where this was tested, the patients had less complications and readmissions, the hospitals and Medicare saved money.
In addition, helping patients understand what needs to happen after discharge is a huge factor in whether they return for readmission or not. Having a discharge nurse or coach with easy and non-confusing instructions regarding medication and other discharge information has helped lower the readmission rate in hospitals that employed this step. Also, having a nurse follow-up by calling the patient and discussing what is happening with them has lowered readmissions for cardiac patients in one hospital by over 75%.
The Boston Globe article suggested that Medicare look at how it is rewarding hospitals, and reward them with bonuses when they save money, rather than paying them well to keep their beds full – even on readmissions.
With Medicare funding at question and lawmakers searching for answers, this is an important issue and the Boston Globe article makes some logical points. Hospitals and lawmakers out there: are you listening?
Unfortunately, Medicare fraud is not a new thing. It has been around for years, though it has grown over the years to a multi-million dollar business. Whether it is unscrupulous sales people selling bogus supplemental policies to unsuspecting seniors or whether it is people sending in claims with dead doctors’ identification numbers or other creative ways to cheat and defraud the Medicare system, there are many ways that the system has been bilked out of millions of dollars – in fact, researchers say that it is now over a billion dollars.
In California, three hospitals have stooped to a new low. The hospitals are accused of picking up homeless people from the skid row area of downtown Los Angeles and bringing them to the hospitals with fake conditions. Once these people were admitted and served their usefulness by being set up for fake treatment for the fake illnesses, they were then shoved back into the ambulance and dumped back off on skid row.
Skid row is a very poor area of downtown Los Angeles where there are quite a large number of homeless individuals, so it was an easy place to perpetrate this hoax. “Runners” working for the hospitals as recruiters would get homeless people to go to a center near the hospital where they were assessed and where their Medicare and Medi-Cal were verified. Once this was done, the recruiters created the information regarding the conditions for these individuals – conditions which would get them into the hospital and get Medicare to pay the bill to the hospital.
The biggest problem is that these homeless individuals didn’t really realize what was happening and didn’t really get treated for those fraudulent conditions, when they may have actually had some actual conditions that needed to be addressed and treated. Sadly, the recruiters actually guaranteed certain numbers of these “patients” to the hospitals and once these individuals were treated – minimally – and released, everyone got paid to the tune of millions of dollars. Each of the homeless individuals was paid $20 to $30 after being released from the hospital.
One thing that the hospitals and their administrators – who were indicted on various charges – did not realize is that they were being closely watched by the FBI. This became their undoing. The FBI and local law enforcement raided the hospitals within the past few days and arrested administrators and others involved in the schemes.
With fraudulent schemes like these and some of the other issues that plague the Medicare system it’s no wonder that overhauling the system and prosecuting fraud to the full extent of the law is essential and needs to happen right now, as this situation in California shows.
Mike Leavitt, head of Health and Human Services wrote to lawmakers a few days ago asking for their help in healing Medicare. In the position he is in, he should know what some of the essential issues are that face Medicare and he has some straightforward ideas as to how to address these issues and begin fixing them.
Leavitt started out by stating that Medicare has done a great deal of good over the years, and this is important for all of us to remember. Medicare in and of itself is a good program, but the world, the United States, and the economy today is far different than it was 43 years ago when Medicare first began. In addition, medical costs have skyrocketed for many reasons including new treatments for diseases such as cancer, heart disease, diabetes and others. Many incredible medical discoveries have been made, however, the costs of caring for individuals with ongoing medical issues – especially critical issues – is much more prohibitive than in the past.
Today’s Medicare has more beneficiaries and fewer workers to fund the program. In addition, the costs of the funding will fall to our children and grandchildren, and if lawmakers – on both sides of the aisle – are not moved to fix the problems inherent in the system sooner, rather than later, the burden on the next generations will be overwhelming.
Leavitt states that in 1970 the cost per Medicare beneficiary was about $2,000 and now, in 2008, it is about $10,000. To make matters worse, there are over double the amount of Medicare beneficiaries now as there were before. Add to this the fact that health care costs have doubled but Medicare costs have quadrupled and baby boomers haven’t yet retired, and this is a recipe for disaster.
It is estimated that in the next 20 years the U.S. will be spending more on Medicare each year than on national defense. Families who are now spending about 23% of their wages on medical care will be spending over 40% of their wages on medical care, and Medicare will account for about 23% of that price tag. Add to that the fact that in 1970, about 4 workers paid for each Medicare beneficiary, and currently, less than 4 workers pay for each beneficiary. Then, looking 20 years ahead, only 2 to 2 and 1/2 workers will pay for each beneficiary, which means that workers will carry a heavy burden and the Medicare system may not be able to handle the toll of paying claims for all the beneficiaries enrolled in it.
Mr. Leavitt is urging Congress to consider these critical issues carefully and act on them in a bipartisan effort to fix as much of the problem as possible before it is too late. After all, it is our children and grandchildren, as well as their children and grandchildren who will be forced to deal with the problem if it is not dealt with now.
We all keep hearing about the problems with the Medicare system including mistakes and underbilling, overbilling and the like. We also hear about fraudulent claims, but things are a lot worse than we have been aware of, and it is costing billions of dollars that could be going toward benefits rather than cuts. The government has been authorizing reimbursements to fraudulent companies for wheelchairs and other equipment, and these reimbursements have cost over a billion dollars. Most of these payments have been made to fake doctors and fake medical supply companies. In fact, the Government Accountability Office (GAO) has been investigating the Centers for Medicare Services (CMS) over the past year and found that CMS had granted billing privileges to two phony companies based in Maryland and Virginia who were supposed to be suppliers of equipment for Medicare recipients, but had no supplies whatsoever to provide to these individuals. In setting up this investigation, the GAO provided CMS with false and sketchy information, and CMS still provided them with the ability to bill for services. This put the fake companies into a situation where not only could they bill for millions of dollars, but they could have also gotten a doctors’ identification code fraudulently and started submitting claims, costing CMS even more money in payments. This “sting” by the GAO proves that there are issues with the enrollment process for Medicare suppliers and that there need to be changes so that fraudulent suppliers don’t take advantage of these issues and loopholes. As a result, the GAO has recently made some changes in enrollment procedures including the requirement that suppliers must be certified and meet other quality standards before they are allowed to do any billing. In addition, some other changes include making it mandatory for suppliers to keep all paperwork from doctors, limiting the use of pagers and cell phones as primary contact numbers for suppliers, and setting up new competitive bidding procedures for suppliers of medical equipment. CMS has been promising since 2005 that they would eliminate much of the fraud in the system, especially in approving fraudulent suppliers. This latest study by the GAO shows that there are still too many problems costing the system, the taxpayers and Medicare recipients too much, with the potential to cost them even more. Had there been real companies behind this sting, rather than fake companies, it could have cost many more millions of dollars. With Medicare benefits in jeopardy of continuing to be cut, it is time to make sure that CMS is doing its job rather than giving money that is already too scarce away. Perhaps if that happened, cuts would not be necessary and Medicare recipients could receive the benefits that they truly need.
In an effort to control quality and costs Medicare is now watching for a number of specific mistakes and other preventable conditions that will not be paid for if claims are submitted for them. This is the latest set of safeguards that Medicare is using to ensure safety and eliminate erroneous claims and payments on those claims.
A “Do Not Pay” list may sound quite harsh, however, items on the list are not just lightweight mistakes. These items are serious, such as giving a blood transfusions using the wrong type of blood. Basically Medicare will not pay for transfusions gone wrong due to human error, and they will not pay for other services that are botched or that should not have been rendered to begin with.
The bottom line is that Medicare will not pay for complications that are preventable. Some of these complications that will not be paid are extra care costs for breaking up blood clots that are created as a result of knee or hip replacement surgery. Poor control of blood sugar levels will not be paid for.
Some individual insurance companies have begun using these strategies as well. Medicare’s move to keep these situations under control will likely bolster insurance companies in taking steps to do the same. In addition some of the states are considering having Medicaid adopt a do not pay list, as well.
There are opponents to this line of thinking including the American Medical Association (AMA). They have stated that there are better ways to contain costs and that they fear that quality of services rendered will actually decrease by enforcing a strict no-pay list because it does not address all circumstances and sometimes situations arise that are not necessarily the hospital’s clear and actual fault. In addition, it could lead to not attempting to provide treatment or services that could help a patient because of the fear of a complication.
It is clear that the do not pay list will have to be researched and addressed further, but for now it is another tool in trying to keep medical care safe and the costs of the care from skyrocketing further.
