Let’s yank licenses of crooked docs

State license is a privilege, not a right

The Coalition has a longstanding position that medical providers who earn most of their income from insurance should have their state license yanked or suspended for committing insurance fraud. That’s a key provision of our model insurance fraud law.

A license is a privilege the state bestows, and not a right.

Why should states act so decisively? Because medical boards rarely act on their own. We surveyed medical boards several years ago and very few actively punished providers who commit insurance fraud. Some only discipline providers for violating their medicine practice, and that insurance fraud isn’t constitute such a violation.

There are enough honest docs practicing ethically that we can afford to get rid of crooks.

Medicare can now impose stiff sanctions. Docs who bilk Medicare can be kicked out of the system. They still can practice but can’t receive Medicare reimbursements. Many cheaters who specialize in fleecing Medicare thus are put out of business.

Minnesota is debating a similar move: Medical providers convicted of insurance fraud can be denied payments by the state’s auto-insurance system under a bill being considered in the statehouse.

The cheaters still can keep their medical license. They’re just out of the no-fault business. And like Medicare swindlers, the no-fault fraud specialists face potential ruin if their main source of income is shut off.

New York started booting dishonest medical providers from the state’s no-fault system several years ago. The state is showing success; more than 18 providers have been removed.

The Coalition holds up New York as a model that other no-fault states should emulate.

Crooked medical providers risk their patients’ health and wellbeing, and steal brazenly from insurers. They shouldn’t be tolerated. No-fault states should follow New York’s lead and weed out crooked docs.

The Coalition strongly believes that dishonest providers who abuse their state license to commit insurance fraud should face strict license review to determine if their license should be suspended or permanently revoked.

About the author: Howard Goldblatt is director of government affairs for the Coalition Against Insurance Fraud.

“Out-of-network” scams hitting insurers and consumer wallets

Legislators must step up and outlaw this sleazy practice

Leave it to creative docs and hospital administrators to drum up new and devious schemes to sink their fingers in your wallet.

out of network imageThe latest scam cropping up across the U.S. is leaving patients and their insurers aghast at outrageous medical bills. The scheme involves the use of “out-of-network” medical providers who basically can charge whatever they damn well please. They aren’t constrained by negotiated fees between in-network providers and insurers.

The scam works like this: You go in for a treatment or surgery — or maybe go to the emergency room after an accident or heart attack. You’re asked to sign the usual paperwork. Most people don’t read or understand much of the fine print that says you’re responsible for all charges — even those by out-of-network providers.

You get the treatment, get well, pay your deductible and bam! You get a bill for thousands or tens of thousands from some doctor you didn’t even know had worked on you.

That doctor might’ve been brought in by your doctor as a “consultant” to watch your operation or review your records.

The New York Times blew the cover on this scam last year. The news outlet found in-network docs who were hiring high-priced physician-consultants out of network and taking kickbacks from them. Since then, similar stories have been appearing across the country.

Legislation has been introduced in Florida to outlaw the practice and bring out-of-network fees more in line with in-network charges. The sponsors of SB516/HB681 likely have a uphill battle because the medical lobby in the state is powerful. But let’s hope the bill sponsors succeed and other states follow their lead to protect consumers from this sleazy practice.

In the meantime, be sure to carefully read all medical paperwork and question the use of out-of-network providers brought in supposedly on your behalf. It could save you a ton of money.

About the author: Dennis Jay is executive director of the Coalition Against Insurance Fraud.

Give health insurers a break from loss ratios

Move will help fight healthcare fraud — and help put downward pressure on premiums

A columnist for the Los Angeles Times recently skewered UnitedHealth for what he says was aiding and abetting a $43-million medical scam involving bogus weight-loss surgeries.

The health plan failed to scrutinize bad claims, the columnist says, until long after money was out the door.

Whether or not the harsh criticism is justified, we’ll leave to others to debate. But if UnitedHealth and others are not investing in expanded anti-fraud efforts, there’s likely a good reason:

Federal law discourages it.

One of the least publicized provisions of the Affordable Care Act is intended to make health insurance more affordable. Health reform governs the percentage of premiums health plans can dedicate to non-claims business expenses, such as marketing, salaries, administration, profit and yes — anti-fraud activities.

The so-called Medical Loss Ratio requires health plans to spend 80 to 85 percent of premiums they collect on claims.

In essence, anti-fraud expenses must be paid out of profit. That’s enough to discourage most health-insurance companies from growing their anti-fraud programs.

In some instances where insurer expenses are out of balance, paying suspect claims could boost profits — or at least not affect them. Now most health insurers wouldn’t intentionally pay suspect claims, but bad claims can be harder to detect when the anti-fraud efforts haven’t grown commensurate with the growth in policies and claims.

And thanks to Obamacare, policies and claims are growing. But anti-fraud efforts are not.

The Medical Loss Ratio is a good idea in theory. It prevents insurers from spending all the new-found premium money on frivolous expenses, such as corporate bonuses.

But good legislation also has unintended consequences — such as discouraging investment in fraud.

If fraud is allowed to increase — such as the $43 million that reportedly was spent on unnecessary and phantom stomach lap-band surgery — then upward pressure will continue on premiums, and everyone loses — except the fraudsters.

The time has come to rethink how the MLR is calculated.

About the authors: Dennis Jay is executive director of the Coalition Against Insurance Fraud. Howard Goldblatt is director of government affairs for the Coalition Against Insurance Fraud.

More eyeballs can probe for Medicare Plan D cheaters

Drug prescribers face scrutiny as Medicare transparency keeps growing

Feel the fresh breeze? That’s from the Medicare database opening up and being exposed to public scrutiny.

A digital dumpster dive is in fast motion. We’re seeing a rush to dig into the federal government’s massive repository of medical provider data ever since Medicare announced it would make its provider database publicly available earlier this month.

A new era of transparency and accountability, the likes of which may have never been seen, is being opened up with surprising speed. Two more events happened this week to notch up the heat on suspect medical provides yet another notch.

First, CMS says it’s opening up non-encrypted Plan D data for easier outside scrutiny. That’s the prescription-drug arm of Medicare. CMS will expand access of unencrypted prescriber, plan and pharmacy identifiers to “researchers and other external entities.” Just who falls into these categories need clarifying, but the rub is that more people will gain more insights on docs who are spooning out suspiciously large quantities of prescriptions.

The latest move affects a large medical enterprise. Part D covers 37.5 million seniors and disabled patients. It pays for roughly 1 of every four prescriptions dolled out in the U.S., and costs taxpayers $62 billion in 2012, the journalist watchdog ProPublica says.

Then a second event happened just a week ago. ProPublica announced a new dive of its own into Medicare’s main database. More than 1,800 docs and other providers billed Medicare for the most expensive types of office visits at least 90 percent of the time in 2012, says ProPublica.

A Michigan doc allegedly charged the most complex and expensive office visits for virtually all of his 201 Medicare patients that year. He billed for an average of eight visits per patient.

Reporters around the U.S. have been prying open the database and writing about high-billing providers nationally or their regional circulation areas ever since Medicare’s original rule went public in early April. We welcome the added scrutiny that the Plan D database opening will bring.

The almost-giddy rush of exposing possible wrongdoing is all well and good. It’s a fresh news story, a new chance to make headlines. Let’s hope this is more than just another news cycle that disappears as soon as the next big news story rumbles into town.

Journalists and watchdogs will be challenged to keep the story alive, to keep mining Medicare for fresh insights that can expose and help weed out the dishonest actors who are gouging taxpayers. Consumers also need to know how their tax dollars are being spent.

And as I wrote in this space earlier, auto and homeowner insurers should dig into the data, including Plan D prescriptions. The same docs who are bilking Medicare may be milking these insurers as well. Insurers of all stripes might find useful fraud-related insights about specific docs and larger fraud trends that affect them.

So let’s work to keep this story alive and visible for a long time to come. And encourage insurers from public and private sectors to share findings that will increase the squeeze on cheating providers.

About the author: Jim Quiggle is director of communications for the Coalition Against Insurance Fraud.

New Medicare data a boon to fraud fighters

May reveal crimes that Medicare missed, and show how taxpayer dollars spent

Reporters have had a grand time sifting through data that Medicare recently released on its payments to docs for 2012. Intrepid news stories poured out, and continue being posted.

Medicare also is expected to release a trove of 2012 payments to hospitals and clinics very shortly.

Thousands of docs received $1 million each from Medicare and several dozen hauled down at least $10 million. Just 344 docs out of more than 825,000 received more than $3 million each, the Associated Press breathlessly reported. State and local news outlets are digging up data on docs in their backyards.

The high-earners typically make the biggest headlines. The unspoken implication of so many stories is that they may have milked Medicare.

A Google search of “database Medicare doctors released” shows about 1.7 million hits — an imperfect measurement but of some value in understanding how big a story the release is.

The medical lobby pushed hard to keep the data hidden away, fearing just this kind of reaction. The raw data can be misleading. Some docs may see a disproportionately high number of seniors or other patients, or have special expertise in a certain area. Some specialists may use expensive meds or treatments that are necessary.

Michael McGinnis received $12.6 million from Medicare in 2012. He was the third-highest beneficiary in the database. He says his Medicare ID code is used to bill for about 27 docs at Plus Diagnostics in Union, N.J., where he’s the medical director.

There may be some truth to such contentions, but Medicare still has done a valuable service. We’ll gain a much better understanding of how Medicare money is being spent.

Certainly fraud fighters have far more data to mine for leads. Auto and workers comp insurers would be wise to jump into the numbers. The same docs or crime rings that defraud Medicare may be going after private auto, comp and health insurers. Many of the ensuing investigations also could uncover criminals who Medicare didn’t catch.

Docs also owe an explanation of where our taxpayer money goes, because it’s our money. And Medicare outliers should be subject to closer scrutiny. Investigations repeatedly show that many outliers got that way for a reason.

Honest providers have nothing to fear if their outlier numbers have a clear and convincing reasoning. An accurate explanation to reasonable questions is part of the responsibility that comes with pocketing our money.

The public and editorial writers also owe every doc a duty not to rush to judgement until the facts come out. So let the facts step forward. We’re a better and more-informed society when we allow truth to surface than sitting on it and hoping there’s nothing to hide.

About the author: Jim Quiggle is director of communications for the Coalition Against Insurance Fraud.

Unchaining fraud from dentistry

Abuses of kids raise issues of corporate dental clinic ownership

Four years ago this space carried a sad story about a national dental chain whose dentists abused kids with unneeded and painful treatments to enrich themselves at the expense of federal taxpayers.

The Justice Department sued the chain’s owners and threatened to ban the chain’s 61 clinics from billing federal health programs. Earlier this month, the feds made good on the threat and issued a five-year ban against the chain owned by CSHM and its corporate successor, Forba Holdings. The chain owns pediatric clinics in 23 states under various “Smiles” names — All Smiles, Small Smiles, Healthy Smiles and Kool Smiles. They mostly target low-income communities and rake in big bucks from billing Medicaid.

One dilemma of such a ban is that it will leave some communities — and kids — without a source of dental care. So to ease the transition, the ban won’t go into effect until September.

Two questions remain from this case. The first deals with the lag time from when this case first broke when a local TV station in Washington, D.C. aired an investigative report after a child died from dental treatment in one of the chain’s facilities. That was in March of 2008 — more than six years ago. The wheels of justice often roll slowly, but six years is far too long when kids’ health and taxpayer dollars are at stake.

The second issue deals with corporate ownership of medical facilities. A pattern has emerged where chains wittingly or unwillingly create a culture for fraud to thrive. Targeting vulnerable people who are less likely to complain combined with lack of oversight by many state Medicaid programs and state dental boards is a recipe for fraud.

Evidence suggests that corporate owners demand such high productivity out of their clinics that unnecessary treatments become the norm. Focusing mostly on the bottom line also encourages clinics to hire marginally competent workers.

Ownership of medical facilities by non-medical people is outlawed in several states. Unless government can provide better oversight, perhaps more states should consider such a prohibition.

Note: Thanks for Dr. Stephen Barrett and Dental Watch for the excellent coverage of this and other scams involving dentistry.

About the author: Dennis Jay is executive director of the Coalition Against Insurance Fraud.

Unneeded spinal surgeries in California beg a few answers

How it could go on for so long — and how it could’ve been prevented

This con likely is one for the record books — a half-billion in fraudulent claims, kickbacks, bribery, money laundering and political intrigue.

The case involving Pacific Hospital in Long Beach, Calif. will take months and maybe years to unwind. Former hospital owner Michael Drobot devised a scheme where more than $500 million in unnecessary surgeries were performed, mostly on workers-comp claimants. He offered kickbacks to doctors to recommend the surgery and the hospital.

He also allegedly bribed state senator Ron Calderon $100,000 to keep a law on the books that allowed the hospital to overbill insurers. The FBI has charged Calderon with taking the bribe. His brother Tom, a former state assemblyman, is charged with money laundering and conspiracy in helping to receive and hide the bribes.

Calderon took a leave of absence this week. That upsets the political landscape in California because his departure now denies Democrats a super majority in the legislature.

Drobot now has pleaded guilty and is cooperating with investigators, so more details soon will surface. This is the largest such insurance scheme in California history, prosecutors say.

Questions involving the impact on victims — the injured workers and their employers — unfortunately, may never be answered:

• How many of these spinal surgeries were necessary?

• How many patients were injured further by needless surgeries?

• How much more in workers comp premiums do businesses have to pay because of huge scam like these?

• How many new businesses were never created because the high cost of worker comp in California got even higher thanks to such scams?

This insurance scandal begs for a deep dive to understand how it could’ve happened, why it went on for so long (1997 to 2013) and how it could’ve been prevented — or at least detected much earlier. I hope fraud fighters, legislators and the medical community have an opportunity to discover the truth. The exercise would be a good case study that prevents honest businesses and workers from being so flagrantly abused in the future.

About the author: Dennis Jay is executive director of the Coalition Against Insurance Fraud.

More Obamacare cons may loom in March

Approach of signup deadline could spur ID-theft cons

Beware the Ides of March, Shakespeare famously penned. Millions of Americans today should beware the Obamacare scams of March.

The deadline for signing up for health coverage under the Affordable Care Act is March 31. The runup to that moment symbolically begins when the calendar rolls into March 1.

Consumers should be on high alert for lowdown cons exploiting the oncoming deadline. It’s a tailor-made hook for swindlers to barrage people with swindles designed to steal consumer identities. Enrollment is picking up steam — signup has passed the 4-million mark. That suggests more Americans gradually are becoming aware of the potentially helpful health-insurance options that health reform is offering them.

This is just the kind of awareness scammers want to take advantage of.

Imagine you’re watching TV in your living room when the phone rings. A stranger says he’s from the federal government. The signup deadline is fast approaching, he warns. You could go to jail unless you register with the feds NOW to receive your federally required Obamacare health card. Even if you protest that you’ve already bought health coverage through an exchange, the smooth talker insists that federal law still requires you to register.

It’s easy, the stranger purrs. Just share your credit card and bank-account info plus your Social Security number. You’re registered with the government, as “required” by health reform. You might even be told to sign up via a bogus state “exchange” or federal “health reform” website. If you take the bait, the con artist has stolen all the info needed to steal your identity, clear out your bank accounts and wreck your credit.

However absurd and divorced from reality such come-ons may be, a well-trained pitch artist can give the ploys great authority and scare value. Scammers propositioned possibly millions of consumers with similar scare tactics during the months leading up to the launch of last October’s open-enrollment period. Bogus exchange websites also popped up.

More Americans are aware of such ploys after flurries of blogs, social-media posts and news stories warned people about scams for months as October 1 approached. But people often have short memories. And the smoothly offered threats by professional hucksters can easily break down your defenses. So be especially alert for shady Obamacare pitches throughout March, and beyond.

Know the warnings and general health-reform information your exchange sends out:

  • Back off if you’re approached by pushy pitchmen who claim they’re from the feds, demand you register, and ask for your financial info.
  • Know what real navigator credentials look like.
  • Don’t allow a supposed navigator to sign you up for a specific health plan, or to charge fees and health premiums.
  • Know what your state exchange website looks like, and how it operates.
  • Visit www.healthcare.gov to find your exchange website and learn more about health reform.

For many Americans, March is the runup to warm spring days ahead. For potential victims, March heralds the approach of icy-cold Obamacare swindles. A little knowledge will chase the cheaters away.

About the author: Jim Quiggle is director of communications for the Coalition Against Insurance Fraud.

One way ACA may aid p/c insurers

New entity to validate efficacy of medical procedures may reduce costs

Why do property/casualty insurers sometimes pay for questionable medical procedures that Medicare and health plans routinely deny?

In part, auto, workers comp and liability carriers are subject to state laws that require them to reimburse medical providers for sketchy procedures. And in other cases, insurers don’t have enough evidence that such procedures are more for enriching doctors, clinics, hospitals and labs than for the health of the patient.

But thanks to the Affordable Care Act (ACA), insurers may have more evidence to deny costly and unnecessary treatment in the future.

The ACA helps fund an entity called the Patient-Centered Outcomes Research Institute (PCORI), whose mission is to find out what really works and what doesn’t in healthcare. With access to electronic medical records, PCORI will be able to analyze mountains of data and pinpoint ineffective procedures that do not lead to the best health outcomes.

As a Washington Post editorial Sunday asks, “Should you get surgery for your back pain or stick with physical therapy? When is heart surgery preferable to drug treatment? And which drugs should you take?”

Unneeded treatment, tests and drugs cost the healthcare system billions of dollars each year. PCORI has potential to bend the cost curve and reduce medical costs — for government, health plans and, yes, even property/casualty insurers. Carriers should follow PCORI’s work closely and see how it can potentially reduce loss costs, lower fraud and help keep property/casualty insurance affordable.

About the author: Dennis Jay is executive director of the Coalition Against Insurance Fraud.

Will Medical expansion expand acts of fraud?

. . . and will state anti-fraud efforts keep up with growing opportunity to commit fraud?

While the launch of the Affordable Care Act has been rocky, one potential bright spot is the number of people signing up for Medicaid expansion. This is the new program aimed at the working poor — people who make too much money to qualify for existing Medicaid benefits, but too little to afford coverage in the private market. More than 21 million Americans fall into this category.

In Kentucky, for example, eight of 10 healthcare enrollees qualify for this program so far.

It’s anybody’s guess how many people will sign up for expanded Medicaid, but it’s likely to be millions over the next few years. And for crooked Medicaid providers, that’s millions of new opportunities to commit fraud.

Medicaid continues to have significant exposure to fraud in many states. Crooked medical providers reap billions of dollars each year from a variety of scams. The schemer could be a nurse in Georgia billing Medicaid to treat dead people, or a dietician also in Georgia stealing IDs of children or a cardiologist in New Jersey lying to patients that they have serious heart disease. And these are cases just from the last few days.

Medicaid is especially vulnerable to scams. Good laws, adequate resources and the determination to resist fraud are lacking in many states.

Medicaid recipients are especially susceptible. They tend to know less about how insurance works, are less likely to question a doctor’s diagnosis and may be more willing to overlook cheating by Medicaid providers. Crooks take advantage by offering recipients a few dollars to hand over their Medicaid policy numbers. Other medical providers have bribed parents to let them “treat” their kids.

The money the federal government sends to states to expand Medicare provides few new fraud-fighting dollars.

Before their rolls swell, Medicaid programs should gear up for what’s likely to be alarge rise in suspect claims. More enrollees equals more claims — and more opportunities for savvy fraudsters to ply their trade under the radar of fraud fighters.

About the author: Dennis Jay is executive director of the Coalition Against Insurance Fraud.