BUSINESS AS USUAL

Exposing Fraud in Medicare Advantage

In the February 4th issue of The New Yorker, there appeared an article by Sheelah Kolhatkar

The Personal Toll of Whistle-Blowing

It tells the story of a physician, Darren Sewell, who worked for Freedom Health, a Tampa health-insurance company, and of his decision to blow the whistle on what he said were its "brazen" floutings of the law. Though his personal  story is gripping and achingly human, I won't repeat it here, but will encourage you to click on the link above and read the entire piece -- Ms. Kolhatkar is a wonderful writer.

The reason I bring up this article is to focus on behavior of some health insurance companies whose behavior is worse than unethical: It's criminal. Kolhatkar writes:

Medicare Advantage, the program that Sewell believed Freedom was abusing, is at the center of a growing number of fraud cases, some of which involve the biggest names in the health-insurance industry. The regulations around the issue are complicated, however, and legal questions about what constitutes prosecutable fraud are still the subject of debate. In 2017, the Department of Justice joined a multimillion-dollar case against the nation’s largest insurer, UnitedHealth Group, alleging widespread fraud dating back to 2006. The Justice Department is also investigating several other health insurers, including Anthem, Humana, Cigna, Health Net, and Aetna. An analysis co-authored by Fred Schulte, at the Center for Public Integrity, estimated that insurance companies had received nearly seventy billion dollars in undeserved Medicare Advantage payments between 2008 and 2013.

Kolhatkar says that Peter Budetti, experienced in these matters, told her: 

“We’ve never been able to get a direct measure of exactly how much fraud there is, but one of the clearest indicators is that, the more money is spent on fighting fraud, the more money is recovered by the government,” he said. He now works as an attorney at Phillips & Cohen, a firm that specializes in whistle-blowing cases. Fraud perpetrated by companies in the health-care industry, he said, is especially pernicious. “On the one hand, they are stealing public money,” he told me. “And on the other hand that money is not going to where it’s supposed to go, which is to taking care of people. They aren’t stealing from people who are selling imported shoes. They are stealing from people who would otherwise be immunizing kids or delivering babies. That’s the heart of it.”

When Sewell joined Freedom Health, he began to sense that the top brass had a "general attitude of contempt toward the government." In addition, he began to notice that the company "was intentionally rooting out sicker, more expensive enrollees by having sales agents target them and then encourage them to leave Freedom, an illegal practice known as 'lemon-dropping.'"  The sales agents, he said, were offered "cash bonuses" for this illegal practice. In addition, he saw that "Freedom was engaging in service-area-expansion fraud—misrepresenting the number of health-care providers in its network in certain counties, so that it could expand the areas in which it offered Medicare Advantage." As further evidence of service-area-expansion fraud: 

Freedom was “renting” groups of doctors in various counties in order to gain C.M.S. approval to expand, and then dropping the doctors after receiving it. In one example that Sewell found, Freedom said that there would be six in-network oncologists in Duval County, a large county in Florida, but patients couldn’t find a single one. The company’s strategy seemed to be paying off: in 2009, Inc.named Freedom one of America’s fastest-growing companies.

By 2010, Sewell had secretly "blown the whistle," and an investigation began. Around then,

Sewell was moved to a different job at Freedom, in the Medicare-revenue-management department, where he reported to an executive named Mital Panara. In his new role, Sewell  ... quickly noticed many coding inaccuracies, almost all of which were in the company’s favor, resulting in higher government payments. Sewell believed that Freedom was committing risk-adjustment fraud—instructing its internal coding auditors to scour medical records for places where the codes could be amplified, a practice known as “capturing” codes .... Freedom hired a nurse and coding specialist to conduct a mock audit of its diagnosis data in order to prepare for a possible audit by the government. According to evidence that Sewell gathered, the specialist found that approximately eighty per cent of the diagnosis codes in the company’s records were unjustified—a shocking number. When the specialist reported the results to Panara, Sewell alleged, he asked her to assess the codes more “leniently.” (Panara denies this.) Medicare regulations dictate that Freedom should have reported the invalid codes to the government and reimbursed it for millions of dollars in overpayments, but, according to Sewell, the company never did so.

In 2017, about 7 years after Sewell brought his whistle-blowing law suit, Freedom decided to settle and agreed to pay the Government $31.7 million. The company admitted no guilt in the matter.

Medicare Advantage is the Government's attempt to privatize Medicare, on the theory that businessmen would be more efficient than the government, and deliver more care for the money. Instead of paying by procedure (the method used by traditional Medicare). the Medicare Advantage insurance companies are paid a fixed amount for each member enrolled. What it doesn't spend in caring for the member, the private insurance company can keep as profit.  In my view, what this scheme has ended up doing is giving to the private health insurance industry billions in profits gained not only by limiting patients' access to treatment -- by networks, pre-authorization requirements, etc. not to mention outright denials of care -- but also by the sort of shady and illegal business practices described above -- practices which have been euphemistically termed "aggressive."  While Freedom was perpetrating these shenanigans, its owner was the cardiologist Kiran C Patel. a hugely successful entrepreneur with a house that has been compared to the Taj Mahal. His philanthropies are legion, and fellow Floridians look up to him with enormous respect, and in the very year of the $31.7 million settlement a Florida publication named him "Floridian of the Year." According to Ms.Kolhatkar, "When asked about the Freedom fine, he responded, 'I decided to take it as a cost of doing business.'"

The prevalence of fraud among Medicare Advantage plans offers one more reason to adopt Single-Payer: According to an opinion piece the New York Times (2/16/2019),

A single federal payer ... may well eliminate the waste, inefficiency and corruption that make the current system so expensive and inaccessible; the experience of countries like Canada and Britain that rely heavily on one government payer suggests as much.

What we have now is a system so fragmented that it is virtually impossible to keep tabs on all the players, who treat the insurance landscape as a wild west of greed and exploitation. Single-payer would be the new sheriff in town bringing law and order. 

Until that new sheriff arrives, what we'll continue to suffer is the anarchy of every man for himself, where Patel's "cost of doing business" is business as usual.

Dio

PS: If you'd like to leave a comment -- and I encourage you to do so -- simply click on the "number of comments" area, and share your thoughts in the "comment rectangle" that appears.

PPS: We know that there are plenty out there who have stories to tell -- stories of your trying to cope with our dysfunctional healthcare system. Trouble is, we don't know what these stories are! That's where you come in. If you have a story to tell, you can email me at indivisible12401@gmail.com. You can be as anonymous as you like. Thanks!

                                                                                                                                                                                                                                                                                                                                                                           

THEY THOUGHT THEY COULD GET AWAY WITH IT

In the August 7, 2018 issue of the L.A. Times there appeared the following article by David Lazarus: 

Sorry about your Stage 3 cancer. Here's a bill for $21,000 in charges you thought were covered.

When Michele Brough was diagnosed with Stage 3 breast cancer in April, her oncologist wasted no time in reaching out to her insurer, Anthem Blue Cross and Blue Shield, to obtain pre-approval for a drug that would strengthen her immune system to better withstand chemotherapy.

The good news came shortly afterward. “We are pleased to authorize benefits for the service(s),” Anthem informed Brough, 56, by letter.

The chemo began in mid-May, with each session including an injection of the pre-approved drug Neulasta Onpro to stimulate production of white blood cells and help ward off infection.

It wasn’t until after the second round of treatment that Brough’s oncologist informed her Anthem wasn’t covering the injections, sticking her with the staggering cost of $7,000 for each shot.As if that weren’t devastating enough, Anthem’s reasoning was downright absurd.

Yes, the drug had been pre-approved, but only if Brough bought it herself through the online pharmacy Express Scripts, and only if she gave herself the shots.“It just made no sense,” Darrell Brough, Michele’s husband, told me. “They covered everything else, all the drugs, all the doctor’s visits. But not this?”

There was nothing in Anthem’s approval letter that said anything about buying it exclusively from Express Scripts or handling your own shots.

And even if Indianapolis resident Brough had bought the drug, her husband said the oncologist refused for legal and safety reasons to administer a drug she had acquired herself.

“They wouldn’t administer it because it wasn’t from their own pharmacy,” he said.

I’ve come across some strange insurance denials, often involving treatments that corporate bean counters say are experimental whereas actual medical professionals say otherwise. But Anthem took this up a level.

The company’s behavior seemed inconsiderate to the point of cruelty — at best an act of gross incompetence, at worst sheer meanness.

I mean, who does that, approving part of a cancer patient’s treatment but not the whole thing? And then sticking the patient mid-treatment with thousands of dollars in unexpected costs for some totally bogus reason?

To be sure, insurance companies are entitled to make money for managing people’s healthcare risk. But that doesn’t justify acts and decisions that demonstrate a near-total lack of empathy.

Michele Brough’s Stage 3 cancer is considered an advanced form of the disease, although the American Cancer Society places the five-year survival rate at 72% with appropriate treatment.

Her husband, who handled all the bills and the dealings with the insurer, said no reasonable person would anticipate a patient receiving chemotherapy treatments from doctors and nurses would be personally responsible for administering her own immune-system booster shots.

Moreover, once the chemo has begun, you’re committed. Even though Brough and his wife were $14,000 in the hole after the second session, they weren’t going to stop even when the oncologist made Michele sign a waiver before the third round promising that she’d be responsible for the cost.

Anthem denied that claim as well, placing the Broughs $21,000 in debt.

For the fourth and final round of chemo, the oncologist decided to skip the booster drug, hoping Michele’s immune system was by now strong enough to take the punishment.

I’m not second-guessing a doctor, but it seems to me that any time you forgo an established treatment solely for financial reasons, you’re placing yourself in danger. Happily, Brough said his wife has responded well to the chemo treatments.

But they weren’t in the clear. Brough said he was told by the oncologist that if Anthem wouldn’t cover the $14,000 for the first two shots, he and his wife would be held responsible and the case could be referred to debt collectors.

“It’s crazy,” he told me. “Any way you look at it, it makes no sense.”

Brough, 56, a project engineer for a computer consulting firm, appealed the charges to Anthem. Weeks later, he wasn’t getting anywhere. So he came to me.

Within days of my getting involved, Anthem acknowledged it had screwed up.

“When we were recently made aware of a concern pertaining to an oncology drug used by one of our consumers, our team began working to understand what happened and found the claims were processed incorrectly,” said Leslie Porras, a company spokeswoman.

I asked why it took a call from a reporter to figure that out. Why didn’t Anthem discover the mistake as soon as Brough lodged his appeal?

“Since the member first contacted us, we have been working with all parties involved to coordinate and resolve this matter,” Porras replied.

All appearances to the contrary notwithstanding.

Shortly afterward, Brough told me he’d heard from Anthem. “They are covering the three injections in full,” he said.

That’s great. It goes without saying, however, that no one should have to rely on the press to resolve an insurance matter — especially when the insurance company is at fault.

The Broughs did everything right. They sought pre-approval for coverage. They promptly appealed questionable charges. Yet they still got what they felt was the runaround.

The only other thing I’d advise in a situation like this is to bring in a professional patient advocate, a person who specializes in navigating the twists and turns of the healthcare system, including billing issues.

Many group insurance plans will cover the cost of a patient advocate — ask your employer. Otherwise, the advocate might charge on an hourly basis or receive up to a third of whatever savings can be secured.

You can search for a local advocate on the website of the National Assn. of Healthcare Advocacy Consultants or via the Alliance of Claims Assistance Professionals.

Another piece of advice: Don’t give up.

As the Broughs saw, insurers make mistakes.

They’re just not particularly good at admitting it.

There's something rotten in the state of our health delivery system, and this article typifies it. First of all, for an insurance company to cover a drug only if the patient purchases it from a specified source, and then administers it herself, is cock-eyed.  What -- did they suppose that any hospital would allow a patient to purchase the drug from a  source other than the hospital? No hospital I've ever heard of would allow such a thing.  Even if the medicine was perfectly safe, the hospital needs to issue the medicine itself for the obvious legal and safety reasons, and, incidentally, so it can make its own absurd profit on the transaction. And would they allow anyone but a licensed professional to administer it? Come on! Anthem Insurance might as well have said, "we'll cover it only if it comes in a plaid wrapper." It's a non-starter, absurd. And even if the above were not so, to inform the patient of all this after the fact, would be ludicrous if someone's life weren't at stake.

I'll tell you what I think: After the pre-approval was granted, somebody at Anthem took a second look at the procedure and thought: "$7,000 per shot is a lot of money! Let's deny it and cook up a reason why -- any reason." And this is  why repeated appeals to them failed: They were, after all, Anthem Insurance, one of the biggest in the nation; who was  going to cross-examine them? 

Which bring me to the most rotten thing of all: It took an appeal to the press to set things right -- after all, the L.A. Times is a very big paper, with a very big circulation.  Did Anthem want all that bad publicity? 

Louis Brandeis once said, "Sunlight is said to be the best of disinfectants; electric light the most efficient policeman." To me, this means that if something is wrong, we have to scream to high heaven, and MAKE IT PUBLIC! That's what this blog is trying to do.

Which brings me to a request: If you or someone you know wouldn't mind making known their struggles with our broken healthcare system please let me know. You can email me at indivisible12401@gmail.com. There are more than a few state politicians out there who got Brownie Points for voting for NYHA when they were confident the Republicans would bat it down. But now that Democrats have the Senate, these "wobbly" Democrats are not so confident, and they may come to remember the source of the money -- corporate -- that got them elected.  SO PLEASE  CONTACT ME ABOUT THIS. You'll be doing us all a favor.

Dio

PS: if you'd like to make a comment -- and I hope you will -- simply click on the number of  comments area and share your thoughts in the "comment box" below.

IT'S AN EMERGENCY!

On July 5th of this year, PBS NewsHour had a very short presentation about the skyrocketing costs of  emergency rooms. A link to it is below, and I really think you should see it; it's as revelatory as it is short:

https://www.pbs.org/newshour/show/why-there-are-shocking-costs-on-your-emergency-room-bill

When the patients got the bill for these procedures, the sticker shock must have been amazing! $629 for a single band-aid for this Connecticut one-year-old, $939 for a bit of toe ointment for the Virginia toddler, and $7924 to fix the broken jaw of the man in Texas -- what was going on, here? There was a lot going on that you could see -- and a lot that you were not allowed to.

Not very many people know that there is a "Facility Fee" charged for just going through the Emergency Room door. This fee is often the greater part of the patient's bill. And that fee varies widely depending on the deal that the Hospital can make with the insurance companies. As was pointed out in the video, there could be a hospital across the street whose Facility Fee would be nothing like that of its medical neighbor. 

How can they get away with this? The reporter expressed the opinion that these hospital ER rooms were acting like monopolies. After working hours, or during the weekends, the ER is a patient's only recourse. and it can charge what it likes. When you add to this the not infrequent practice of having the patient treated by out-of-network doctors -- as was the surgeon in the case of the Texas man with the broken jaw. -- the patient is due for a rueful shock.

Of course the hospitals rightfully point out that it's very expensive to run a hospital, to keep the lights on in the emergency room, with  enough doctors, nurses, technicians, etc ready to go even if there is nobody to treat. And of course. there's the expense incurred by many of the patients, who, if not indigent, will be unable to pay the exorbitant rates charged. 

Is the hospital merely trying to cover costs,  here, or do they see the ER as a profit center?  They hold their fiscal cards so close to their chests that you can't know for sure. 

But in web forum Quora I read; "Modern Healthcare quotes Dr.Andrew Agwunobi, head of the hospital performance practice at Berkley Research Group, as saying that hospitals traditionally did not invest much capital in the ED in the belief that it provided mostly uncompensated care. The underlying assumption was that delivery system reform would ultimately reduce the number of visits to the ED and steer patients toward lower-level settings.'What they found was that the financial health of the hospital was actually in jeopardy. Most of the revenue of the hospital was actually coming from the emergency department.'"

This suggests to me that Dr. Agwunobi was portraying the ER as a hospital-saving profit generator. And he was not the only one to recognize this: President Obama proposed regulations that would limit the ER profits, but such a loud howl sprang up and such a strong push-back came from the hospital community that he abandoned the idea, and it has not been touched since.

Meanwhile, the insurance companies have become increasingly unhappy about the  ER charges they were having to pay -- so much so that in the Vox series alluded to in the video included here, it was reported that the Anthem Insurance Company has decided that -- in 4 states at least  -- it would pay only for ER visits to address conditions that proved life-threatening.  As you can imagine, this has caused very unhappy results! There was a woman -- a nurse as it happened -- whose severe pain felt to her like it might be appendicitis. It being a weekend, she went to the ER, which performed a battery of tests on her and determined that what she had wasn't appendicitis but ovarian cysts. They gave her  a couple of pain killing pills and an order to see her Gynecologist. They also gave her a bill for some $1200. Anthem informed her that since her condition wasn't going to kill her any time soon, the charges were hers to pay -- not theirs. 

In other words, the insurance company was telling the woman to be her own doctor, and decide whether or not the ER visit was really necessary, or whether she could risk waiting for Monday when her Gynecologist would be seeing patients.

This is only one example of how the profit motive has become so enmeshed with medical practice, that lives are put at risk -- human lives being secondary to the fat profits of the industry, and the huge salaries of their CEOs.

We cannot go on with this broken system. The price-gougers and the very rich may like it just fine, but for us regular folks, it's an emergency.

Dio