Forbes published an article on December 11, 2019, after interviewing the Administrator of the Centers for Medicare and Medicaid Services (CMS), Seema Verma. Ms. Verma itemized three focus areas:
- the lack of healthcare cost and care transparency;
- the accrued complexity of government healthcare regulations;
- the legislative impediments to making responsive changes when presented with new circumstances
Ms. Verma has a tough job. None of what I say below is out of
disrespect for her. Nonetheless, because I have served as an expert witness on some of the largest Medicare fraud cases to date, I cannot help but see these initiatives as more of the same from the past.
One of the centerpieces of CMS’ vision is:
The proposed new rules would ease the compliance burden for healthcare providers, while maintaining safeguards that protect patients and programs from fraud and abuse. When finalized, they could facilitate outcome-based payment arrangements.
That is exactly the way Medicare Part C works today. Yet, there have been multi $millions in detected fraud cases and likely a much higher amount that goes undetected. While these plans are well-meaning, it has been easy for dishonest physicians to fraudulently diagnose patients with conditions that enable them to receive a fraudulently high capitated monthly payment, then treat the patient, and then reduce the severity of the diagnosis to receive a bonus payment for getting them well again. These methods, called ‘risk adjustment’ can be beneficial but they also create multipliers that fraudulent doctors can abuse.
Second, Medicare policies used to determine what is medically necessary (a key determinant for coverage and payment) are inconsistent. Imagine being able to get a fully covered non-emergency ambulance ride if you are under the influence of hallucinogenic drugs in Colorado, but being ineligible for the same ambulance transportation in Guam unless you are bed-confined due to a much more stringent coverage policy. In the past ten years, LCDs in different jurisdictions have implemented exactly these types of policies. The fact is that Local Coverage Determinations (LCDs), according to the HHS OIG are inconsistent and create inequitable access to care according to OIG’s 2014 report.
Third, if one is trying to combat fraud, a consistent set of LCDs needs to be used to apply a uniform Standard to what is medically necessary vs. what is fraudulent. There are many loopholes that create vague interpretations. Not that all fraud is proper nor that it cannot at times be detected, but Medicare’s own policies have limited its effectiveness. Many $billions have been wasted on fraudulent and undetected payments by Medicare.
This should be a non-partisan issue. These issues are not Obama administration or Trump administration issues, they have been this way for decades across Democratic and Republican administrations. It is time for a change and some truly new thinking. Perhaps fixing what we have will be better than creating more and new legislation and policies.
Medicare Part C Risk Adjustment