PNHP

Uwe Reinhardt on fraud and abuse

How Much Fraud and Abuse Is There in U.S. Health Care?

By Uwe E. Reinhardt
The New York Times
March 5, 2010

One of the more remarkable proposals put on the table at last weekā€™s bipartisan summit on health care reform was an idea from Senator Tom Coburn, an Oklahoma Republican, to deploy undercover agents posing as patients in an effort to ferret out fraud and abuse by doctors and hospitals.

It subsequently became one of the ideas from Republicans that President Obama offered to incorporate in a revised health reform bill. One wonders whether the president was sincere or just being a bit naughty.

After all, the idea to legislate the infiltration of undercover agents into private medical practices and hospitals in America does not exactly square with the loudly voiced opposition of Republicans to government intrusion into American health care. Can one imagine anything more intrusive?

Senator Coburn is a physician and may have reasons to put forth such a controversial idea. As someone outside of the profession, I would not be in a position to second-guess him on that issue.

…

If the president and Congress wish to constrain the growth of the administrative cost of American health care, they should look not only to the private health insurance industry. They might commission a study exploring how government-run health systems in other nations manage to pay hospitals and doctors without imposing on them the huge administrative burden borne by American providers of health care. Perhaps Congress can learn from such a study.

A proper slogan here might be ā€œevidence-based administrationā€ (E.B.A.), meaning that just as the use of clinical procedures should be based on solid empirical evidence that they work and are worth their cost, the ever-new administrative burdens that government imposes on health-care providers should meet the same evidence-based test.

A second problem faced by hospital executives is that they have only partial control over the costs they must book and for which they seek to get paid. The bulk of these costs are driven by the clinical decisions of physicians who are affiliated with hospitals and can use the hospital as a free workshop, so to speak.

http://economix.blogs.nytimes.com/2010/03/05/how-much-fraud-and-abuse-is-there-in-u-s-health-care/

Posted response of Don McCanne, San Juan Capistrano, CA (# 1):

Instances of blatant fraud in health care provide great fodder for the media. The identification and prosecution of criminals in Florida becomes national news.

Those who claim that fraud and abuse are a primary reason for high health care costs use such stories to say that the government is not doing its job in identifying and prosecuting these crooks, when the stories are about the government doing its job in identifying and prosecuting these crooks.

Thieves will always be with us and need to be ferreted out, and the government will continue to do that.

The far greater problem, as Dr. Reinhardt explains, is in physician practice patterns. The great variability in use of resources is not so much a matter of abuse as it is simply a variation in individual and regional concepts of “that’s the way its done.”

Much of the high use is in imaging, or consultations, or referral for high-tech procedures for which the primary physician receives no additional compensation. That is not fraud.

Nor is it defensive medicine. A test or consultation allegedly ordered to prevent a malpractice lawsuit is not ordered out of an intellectual void. It is ordered because the patient has a real risk, even if small, of having a problem that may require intervention.

Most physicians want to practice high quality, efficient medicine. They welcome information such as that generated by the British NICE program – a program designed to identify best practices. The opponents of reform dismiss even these efforts with nonsense accusations of “rationing.”

Not spending money on medical services that are not helpful or even harmful is not rationing. Rather it exemplifies a fundamental concept characteristic of free markets – providing more transparency in order to obtain greater value in our health care purchasing.

Uwe Reinhardt on fraud and abuse

How Much Fraud and Abuse Is There in U.S. Health Care?

By Uwe E. Reinhardt
The New York Times
March 5, 2010
One of the more remarkable proposals put on the table at last weekā€™s bipartisan summit on health care reform was an idea from Senator Tom Coburn, an Oklahoma Republican, to deploy undercover agents posing as patients in an effort to ferret out fraud and abuse by doctors and hospitals.
It subsequently became one of the ideas from Republicans that President Obama offered to incorporate in a revised health reform bill. One wonders whether the president was sincere or just being a bit naughty.
After all, the idea to legislate the infiltration of undercover agents into private medical practices and hospitals in America does not exactly square with the loudly voiced opposition of Republicans to government intrusion into American health care. Can one imagine anything more intrusive?
Senator Coburn is a physician and may have reasons to put forth such a controversial idea. As someone outside of the profession, I would not be in a position to second-guess him on that issue.
…
If the president and Congress wish to constrain the growth of the administrative cost of American health care, they should look not only to the private health insurance industry. They might commission a study exploring how government-run health systems in other nations manage to pay hospitals and doctors without imposing on them the huge administrative burden borne by American providers of health care. Perhaps Congress can learn from such a study.
A proper slogan here might be ā€œevidence-based administrationā€ (E.B.A.), meaning that just as the use of clinical procedures should be based on solid empirical evidence that they work and are worth their cost, the ever-new administrative burdens that government imposes on health-care providers should meet the same evidence-based test.
A second problem faced by hospital executives is that they have only partial control over the costs they must book and for which they seek to get paid. The bulk of these costs are driven by the clinical decisions of physicians who are affiliated with hospitals and can use the hospital as a free workshop, so to speak.
http://economix.blogs.nytimes.com/2010/03/05/how-much-fraud-and-abuse-is-there-in-u-s-health-care/

Posted response of Don McCanne, San Juan Capistrano, CA (# 1):
Instances of blatant fraud in health care provide great fodder for the media. The identification and prosecution of criminals in Florida becomes national news.
Those who claim that fraud and abuse are a primary reason for high health care costs use such stories to say that the government is not doing its job in identifying and prosecuting these crooks, when the stories are about the government doing its job in identifying and prosecuting these crooks.
Thieves will always be with us and need to be ferreted out, and the government will continue to do that.
The far greater problem, as Dr. Reinhardt explains, is in physician practice patterns. The great variability in use of resources is not so much a matter of abuse as it is simply a variation in individual and regional concepts of “that’s the way its done.”
Much of the high use is in imaging, or consultations, or referral for high-tech procedures for which the primary physician receives no additional compensation. That is not fraud.
Nor is it defensive medicine. A test or consultation allegedly ordered to prevent a malpractice lawsuit is not ordered out of an intellectual void. It is ordered because the patient has a real risk, even if small, of having a problem that may require intervention.
Most physicians want to practice high quality, efficient medicine. They welcome information such as that generated by the British NICE program – a program designed to identify best practices. The opponents of reform dismiss even these efforts with nonsense accusations of “rationing.”
Not spending money on medical services that are not helpful or even harmful is not rationing. Rather it exemplifies a fundamental concept characteristic of free markets – providing more transparency in order to obtain greater value in our health care purchasing.