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(Kens 5 San Antonio)   Why computers are awesome: Medicare inspectors were able to uncover $5.6 billion in potential fraud by running a statistical analysis on all 1 billion prescriptions filled at retail pharmacies that were billed to Medicare last year   (kens5.com) divider line 77
    More: Interesting, medicare, statistical analysis, data analysis, generic drugs, prescription costs, doughnut hole, pharmacy, strip malls  
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3526 clicks; posted to Geek » on 10 May 2012 at 11:35 AM (2 years ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-05-10 09:38:50 AM
It's better than nothing, but that $5.6 billion is already out the door and good luck getting it back. And what little is recovered...goes right back into Medicare where it can be stolen again.

Medicare does not require the private insurers that deliver prescription benefits to seniors to report suspicious billing patterns.

That's so profoundly stupid it can only be there by design.

Overall, only a small fraction of retail pharmacies - 4.4 percent - were found to have telltale patterns of questionable billings.

One out of every 23 is small?

I wonder how many businesses would survive with a mentality of "well, only one out of 23 employees is stealing us blind. No biggy."

Nationally, independent pharmacies were more likely to have problems than chain drugstores.

Probably because those "independent pharmacies" were nothing more than storefronts.

"The program has limited safeguards in place and is vulnerable to fraud, waste and abuse," the report said.

This is not a headline from 30 years ago.
 
2012-05-10 09:41:58 AM
They are using this approach across the board. They just put away a guy for food stamp fraud here in Minneapolis that was discovered using this technique.
 
2012-05-10 10:04:52 AM

That's so profoundly stupid it can only be there by design.


This is how people feel about you.
 
2012-05-10 10:19:26 AM
Gulper Eel

you realize that medicare's overhead (overhead includes fraud, operating costs, profit taking, etc) as a % of it's budget is around 4% ... the private insurers are around 30%
 
2012-05-10 10:45:27 AM

Kazan: Gulper Eel

you realize that medicare's overhead (overhead includes fraud, operating costs, profit taking, etc) as a % of it's budget is around 4% ... the private insurers are around 30%


Math. You fail at it.

TFA clearly states that this particular facet of Medicare shows an observed "questionable payment" rate of ten and a half percent. ($5.6b divided by $53b - I'm assuming the writers are comparing 2009 to 2009).

So that's ten and a half percent...even before this program examines what other prescription spending might have been redundant or wasteful.

Other examinations of Medicare and Medicaid show similar and far higher levels of straight-up fraud, along with waste and duplication - and pushback from the hospital industry when actual oversight is done.

Additionally, private insurers 'higher' overhead is money spent to ensure that they're NOT doing what Washington does - namely, throwing money around to placate (mainly elderly) voters without bothering to check whether it went to a legitimate provider until the money's been spent.

In other words, citations needed (and from somebody without skin in the game).
 
2012-05-10 10:56:30 AM

Gulper Eel: Kazan: Gulper Eel

you realize that medicare's overhead (overhead includes fraud, operating costs, profit taking, etc) as a % of it's budget is around 4% ... the private insurers are around 30%

Math. You fail at it.

TFA clearly states that this particular facet of Medicare shows an observed "questionable payment" rate of ten and a half percent. ($5.6b divided by $53b - I'm assuming the writers are comparing 2009 to 2009).

So that's ten and a half percent...even before this program examines what other prescription spending might have been redundant or wasteful.

Other examinations of Medicare and Medicaid show similar and far higher levels of straight-up fraud, along with waste and duplication - and pushback from the hospital industry when actual oversight is done.


ENTIRE PROGRAM VS ONE PART... farking hell.. and your nytimes citation talks about ny's state level medicare.

Gulper Eel: Additionally, private insurers 'higher' overhead is money spent to ensure that they're NOT doing what Washington does - namely, throwing money around to placate (mainly elderly) voters without bothering to check whether it went to a legitimate provider until the money's been spent.

buuuuuuuuuuuuuuulshiat


it goes into their goddamn pockets

politifact has a write up on when boxer made the claim and found it to be largely true Link
 
2012-05-10 11:03:47 AM

NowhereMon: They are using this approach across the board. They just put away a guy for food stamp fraud here in Minneapolis that was discovered using this technique.


My employer sells analytics software (amongst othe rthings), and they decided that it would be a very cool idea to test them on our internal expence claims. There are apparently lots of people who had very hard questions to answer after the first test runs. For example, it seems the mileage from base offices to various customer locations varies by up to 500% depending on who's driving.
 
2012-05-10 11:15:09 AM

Gulper Eel: Medicare does not require the private insurers that deliver prescription benefits to seniors to report suspicious billing patterns.

That's so profoundly stupid it can only be there by design.


Requiring private insurers that deliver prescription benefits to seniors to report suspicious billing patterns is business killing government regulation. Why do you hate jobs?
 
2012-05-10 11:16:51 AM
Why computers statistical analysis is awesome

FTFY subby.

Computers are just a tool.
 
2012-05-10 11:20:24 AM

Gulper Eel: Additionally, private insurers 'higher' overhead is money spent to ensure that they're NOT doing what Washington does - namely, throwing money around to placate (mainly elderly) voters without bothering to check whether it went to a legitimate provider until the money's been spent.


WRONG. some of it goes into actual fraud prevention, but the bulk goes into shareholder profits.

For example: United Health Group:
Revenues: $101,862,000
- Medical costs: $74,332,000
- Operating costs: $15,557,000
- Cost of products sold: $2,385,000
- Depreciation: $1,124,000
--------------------------------------
Earnings (before taxes): $8,464,000

The operating costs was only 15% of their total revenues, and that includes paying the bills and salaries. Fraud prevention is a minute portion of that.
 
2012-05-10 11:21:46 AM
Numbers above are in thousands.
 
2012-05-10 11:25:16 AM

Kazan: politifact has a write up on when boxer made the claim and found it to be largely true Link


Yes, I read that true. It's an interesting world you live in where "half true" equals "largely true". (and a reading of that article indicates Poltifiact is being charitable)

Additionally, that article shows that your original assertions that private sector overhead is ~30% and that Medicare overhead includes fraud numbers...are both bullshiat.

Thank you for refuting yourself.
 
2012-05-10 11:27:38 AM

Flab: WRONG. some of it goes into actual fraud prevention, but the bulk goes into shareholder profits.


Profits? Heavens forfend. Where's my faiinting couch?
 
2012-05-10 11:32:12 AM

Gulper Eel: Profits?


I have nothing against profits, in fact, as an investor, I like companies to make a profit. But you made it sound like the 30% overhead was ALL going towards fraud prevention, and it's clearly not the case.
 
2012-05-10 11:38:10 AM
Correlation isn't causation.
But it might be fraud.
 
2012-05-10 11:38:53 AM

Gulper Eel: It's better than nothing, but that $5.6 billion is already out the door and good luck getting it back. And what little is recovered...goes right back into Medicare where it can be stolen again.

Medicare does not require the private insurers that deliver prescription benefits to seniors to report suspicious billing patterns.

That's so profoundly stupid it can only be there by design.

Overall, only a small fraction of retail pharmacies - 4.4 percent - were found to have telltale patterns of questionable billings.

One out of every 23 is small?

I wonder how many businesses would survive with a mentality of "well, only one out of 23 employees is stealing us blind. No biggy."

Nationally, independent pharmacies were more likely to have problems than chain drugstores.

Probably because those "independent pharmacies" were nothing more than storefronts.

"The program has limited safeguards in place and is vulnerable to fraud, waste and abuse," the report said.

This is not a headline from 30 years ago.


I'm really surprised to find you here upset that anti-fraud measures continue to produce results. You'd think with Medicare waste being your pet gripe, this would be welcome news.
 
2012-05-10 11:39:29 AM

Flab: Gulper Eel: Profits?

I have nothing against profits, in fact, as an investor, I like companies to make a profit. But you made it sound like the 30% overhead was ALL going towards fraud prevention, and it's clearly not the case.


Not my intent, sorry.

It is pretty clear that even a small anti-fraud investment by Medicare would yield huge savings...especially if they stopped the fraud BEFORE the money was gone, for a change.

Unfortunately, Medicare uses this thoroughly silly "pay-and-chase" system where they cut the checks first and ask questions later. We are forever hearing from various government functionaries that pay-and-chase is going to go away, but articles like this one make it pretty clear that it's not going to happen at any serious level any time soon.
 
2012-05-10 11:41:33 AM

Gulper Eel: It's better than nothing...


Wasn't graft/fraud/etc one of those Teabagger talking points?

Y'know, the whole 'Fixing the Old' bit? Why is that now only 'better than nothing'?
 
2012-05-10 11:47:23 AM
Good.

The more troubling thing they need to address is the whole "pay the first to bill for one" problem: There are tests / exams / etc that Medicare limits to specific time periods (as in, "can only get x test every y months," say)*, but the first organization to bill for it gets paid.... even if it's poorly done, worthless or misinterpreted. The organization stuck cleaning up after some idiot doctor / RT / whatever and re-doing the test can't bill and often has to eat the cost.

This should be addressed and, further, the DBs should be mined to find the doctors / labs / etc that have abnormally high "do-over by someone else" records and their fees should be reduced and their licenses and procedures inspected.

There's lots of data collected by Medicare. I hope this is just a good first start in mining it to find ways to improve delivery of care.
 
2012-05-10 11:49:52 AM

Omnivorous: Correlation isn't causation.
But it might be fraud.


This.

The distaffbopper was once accused by a pharmacist of committing fraud. The prescription the doctor had written for the littlebopper was in the name we called him*, but his Medicaid card was to "Boy Doe", he being a foundling that hadn't been officially given a legal name at the time, and also being an indigent ward of the county. The prescription was for an antibiotic commonly used to treat ear infections in infants, which the littlebopper had at the time.

Luckily, a quick phone call to the supervising pharmacist at the place, who knew us and our special circumstances, cleared that up, and the guy apologized.

We also had to go through a bunch of shenanigans to get him a SS# after the adoption.

*And that is now his legal name, since the adoption.
 
2012-05-10 11:50:20 AM

Gulper Eel: I wonder how many businesses would survive with a mentality of "well, only one out of 23 employees is stealing us blind. No biggy."


Quite a few, actually. Pretty much all the "big box" stores.
 
2012-05-10 11:53:37 AM

dragonchild: Gulper Eel: I wonder how many businesses would survive with a mentality of "well, only one out of 23 employees is stealing us blind. No biggy."

Quite a few, actually. Pretty much all the "big box" stores.


I'm pretty sure even the dimmest Best Buy floor manager would manage a "what's all this, then?" if one of his underlings was strolling out the door with ten flat-screen TVs.
 
2012-05-10 11:54:19 AM
Why computers are awesome: Medicare inspectors were able to uncover $5.6 billion in potential fraud by running a statistical analysis on all 1 billion prescriptions filled at retail pharmacies that were billed to Medicare last year.

Also, porn.
 
2012-05-10 11:54:38 AM

Gulper Eel: It is pretty clear that even a small anti-fraud investment by Medicare would yield huge savings...especially if they stopped the fraud BEFORE the money was gone, for a change.


Agreed. It's very hard to do without taking control of the whole assembly line, though.

Hopefully these new analysis tools will allow them to start rejecting claims as they come in, or at least ask the claimant for additional justification in suspicious cases ("Hm... This Dr. House from New Jersey seems to prescibe a lot of Percocet"), just like banks and phone companies are now doing when they see irregular transaction patterns.
 
2012-05-10 11:59:02 AM

Gulper Eel: I'm pretty sure even the dimmest Best Buy floor manager would manage a "what's all this, then?" if one of his underlings was strolling out the door with ten flat-screen TVs.


Why the fark does it have to be ten flat screen TVs? Couldn't you have just said, "Hm, hadn't thought of that," instead of roaring out of the gate by taking reductio ad absurdum to derpy extremes?
 
2012-05-10 12:00:32 PM

dragonchild: Quite a few, actually. Pretty much all the "big box" stores.


I'd say the majority when you look at CEO pay vs company performance.
 
2012-05-10 12:03:37 PM
Hopefully these new analysis tools will allow them to start rejecting claims as they come in, or at least ask the claimant for additional justification in suspicious cases ("Hm... This Dr. House from New Jersey seems to prescibe a lot of Percocet"), just like banks and phone companies are now doing when they see irregular transaction patterns.

Great.

You of course know the result of this is 10% of claims will be unnecessarily rejected by a computer and the process to get your legit claim 'unrejected' will take 3 weeks and the filling of several forms.
 
2012-05-10 12:10:17 PM

Gulper Eel: Flab: Gulper Eel: Profits?

I have nothing against profits, in fact, as an investor, I like companies to make a profit. But you made it sound like the 30% overhead was ALL going towards fraud prevention, and it's clearly not the case.

Not my intent, sorry.

It is pretty clear that even a small anti-fraud investment by Medicare would yield huge savings...especially if they stopped the fraud BEFORE the money was gone, for a change.

Unfortunately, Medicare uses this thoroughly silly "pay-and-chase" system where they cut the checks first and ask questions later. We are forever hearing from various government functionaries that pay-and-chase is going to go away, but articles like this one make it pretty clear that it's not going to happen at any serious level any time soon.


"Pay and Chase " will never go away because of another Washington phrase "Constituent services" . Suppose Medicare's analytics discover that it looks like a hospital in Podunk, IL is robbing them blind and so they refuse payment on their invoices. The hospital board (all big contributors to his re-election campaign) contact Congressman Vreeblefester (R-IL) and tell him that these evil government bean counters won't give them their money and the hospital is going to have to shut down most of its services if they don't get paid. Meanwhile the hospital has told its patients that, particularly the elderly and most vulnerable and scared THEM into writing desperate letters to the congresscritter as well.

Well the Congressman fires off an Angry Letter to the HHS administrator (CC'ed to all the concerned folks back home) demanding to know why his home district hospital, a pillar of the community and famed for its sterling integrity, is being so badly misued by the flunkies at HHS. The HHS administrator gives it to his Congressional Coresspondance people and tell them to look into it. This gets all the way back down to the GS-13 or 14 who made the call in the first place, and his boss' boss' boss is telling him he'd got-damned well BETTER be right about this call or his career is over. That's when the HHS aide to the administrator who is also on the conference call suggests a "compromise" where the Gs-13 continues his investigation and tries to make a case the US attorney can make, and in the meantime we cut the check to Podunk Memorial so the Congressman doesn't rip the Departnment a new one in Congressional hearings next week.
 
2012-05-10 12:10:39 PM
Medicare paid $5.6 billion to 2,600 pharmacies with questionable billings, including a Kansas drugstore that submitted more than 1,000 prescriptions each for two patients in just one year, government investigators have found

You need statistical analysis and computers to tell you that 1000 scripts for one person is off?
 
2012-05-10 12:14:34 PM

MugzyBrown: Hopefully these new analysis tools will allow them to start rejecting claims as they come in, or at least ask the claimant for additional justification in suspicious cases ("Hm... This Dr. House from New Jersey seems to prescibe a lot of Percocet"), just like banks and phone companies are now doing when they see irregular transaction patterns.

Great.

You of course know the result of this is 10% of claims will be unnecessarily rejected by a computer and the process to get your legit claim 'unrejected' will take 3 weeks and the filling of several forms.


So the alternative is to let fake drug stores abuse the system?

The system doesn't have to deny the claims completely. It can set a temporary limit until the pharmacist can justify why his customers buy 5 times the national average of drug X.
 
2012-05-10 12:14:43 PM
Potential fraud. Now it needs someone to go and check it by hand, which costs a lot of money when most of the potential fraud turns out to be just atypical.

Or are we in favor of automated lawsuits when it's not the MPAA doing it?
 
2012-05-10 12:15:21 PM

dragonchild: Gulper Eel: I'm pretty sure even the dimmest Best Buy floor manager would manage a "what's all this, then?" if one of his underlings was strolling out the door with ten flat-screen TVs.

Why the fark does it have to be ten flat screen TVs? Couldn't you have just said, "Hm, hadn't thought of that," instead of roaring out of the gate by taking reductio ad absurdum to derpy extremes?


I'm going to go out on a limb and say that it's because reductio ad absurdum is funny. Which you clearly need a lesson in, given 1) This is Fark 2) See #1
 
2012-05-10 12:15:26 PM

dragonchild: Gulper Eel: I'm pretty sure even the dimmest Best Buy floor manager would manage a "what's all this, then?" if one of his underlings was strolling out the door with ten flat-screen TVs.

Why the fark does it have to be ten flat screen TVs? Couldn't you have just said, "Hm, hadn't thought of that," instead of roaring out of the gate by taking reductio ad absurdum to derpy extremes?


It's the floor manager who does the stealing.
 
2012-05-10 12:16:10 PM

dittybopper: Luckily, a quick phone call to the supervising pharmacist at the place, who knew us and our special circumstances, cleared that up, and the guy apologized.


Good thing you weren't at a CVS.......
 
2012-05-10 12:19:08 PM

Flab: So the alternative is to let fake drug stores abuse the system?

The system doesn't have to deny the claims completely. It can set a temporary limit until the pharmacist can justify why his customers buy 5 times the national average of drug X.


Just pointing out the obvious. have you ever tried to deal with a government agency about an error made?

Talking with people who have no ability to make judgements, but can only check off their list?
 
2012-05-10 12:19:18 PM
One thing about the cost of drugs I hadn't realized:

They actually have each chemical plant only perform one or two steps of the synthesis at a time. Then they ship it to other plants to go through the rest of the steps. I thought it was basically all done in one location with your basic ingredients (phenols, alcohols, amines, aromatics) turned into a finished product.

When they're shipping the 1,2,3,4,5,6,7,8,9-phenylbenzylarylalylthiodioleneaneone or whatever the fark between plants, it racks up costs like crazy.
 
2012-05-10 12:29:23 PM

Flab: MugzyBrown: Hopefully these new analysis tools will allow them to start rejecting claims as they come in, or at least ask the claimant for additional justification in suspicious cases ("Hm... This Dr. House from New Jersey seems to prescibe a lot of Percocet"), just like banks and phone companies are now doing when they see irregular transaction patterns.

Great.

You of course know the result of this is 10% of claims will be unnecessarily rejected by a computer and the process to get your legit claim 'unrejected' will take 3 weeks and the filling of several forms.

So the alternative is to let fake drug stores abuse the system?

The system doesn't have to deny the claims completely. It can set a temporary limit until the pharmacist can justify why his customers buy 5 times the national average of drug X.


And if the customer, who legitimately needed that amount of X, dies while "being choked by government bureaucracy"?

Obviously no one wants to be defrauded and no one wants to see anyone die needlessly, but there's a certain urgent time constraint to medical care versus a seven year statute of limitations on fraud -- so yes, I'd rather the fake drug store temporarily abuse the system (and get punished for it later).
 
2012-05-10 12:45:06 PM

Kazan: Gulper Eel: Kazan: Gulper Eel

you realize that medicare's overhead (overhead includes fraud, operating costs, profit taking, etc) as a % of it's budget is around 4% ... the private insurers are around 30%

Math. You fail at it.

TFA clearly states that this particular facet of Medicare shows an observed "questionable payment" rate of ten and a half percent. ($5.6b divided by $53b - I'm assuming the writers are comparing 2009 to 2009).

So that's ten and a half percent...even before this program examines what other prescription spending might have been redundant or wasteful.

Other examinations of Medicare and Medicaid show similar and far higher levels of straight-up fraud, along with waste and duplication - and pushback from the hospital industry when actual oversight is done.

ENTIRE PROGRAM VS ONE PART... farking hell.. and your nytimes citation talks about ny's state level medicare.

Gulper Eel: Additionally, private insurers 'higher' overhead is money spent to ensure that they're NOT doing what Washington does - namely, throwing money around to placate (mainly elderly) voters without bothering to check whether it went to a legitimate provider until the money's been spent.

buuuuuuuuuuuuuuulshiat


it goes into their goddamn pockets

politifact has a write up on when boxer made the claim and found it to be largely true Link


Wow. You just destroyed him, Kazan. Nicely done!
 
2012-05-10 12:55:56 PM

Publikwerks: Medicare paid $5.6 billion to 2,600 pharmacies with questionable billings, including a Kansas drugstore that submitted more than 1,000 prescriptions each for two patients in just one year, government investigators have found

You need statistical analysis and computers to tell you that 1000 scripts for one person is off?


Okay, next time I'll hand you a printed list of claim data for all one billion prescriptions and you can do the analysis by hand.
 
2012-05-10 01:01:01 PM
why computers are not awesome: ONLY 5.6 billion? does no one else think that # is pretty low? the system is incredibly filled with cheats.
 
2012-05-10 01:04:24 PM

Omnivorous: Correlation isn't causation.


Although if you're looking for causation, correlation is usually a pretty good place to start.
 
2012-05-10 01:06:54 PM

omnibus_necanda_sunt: One thing about the cost of drugs I hadn't realized:

They actually have each chemical plant only perform one or two steps of the synthesis at a time. Then they ship it to other plants to go through the rest of the steps. I thought it was basically all done in one location with your basic ingredients (phenols, alcohols, amines, aromatics) turned into a finished product.

When they're shipping the 1,2,3,4,5,6,7,8,9-phenylbenzylarylalylthiodioleneaneone or whatever the fark between plants, it racks up costs like crazy.


Still trivial. It costs cents to make the second pill, but billions of dollars to make the first one. Then you have whatever part of your patent is left after getting through approval to make those billions back before Dr. Reddy's starts undercutting you.
 
2012-05-10 01:08:23 PM

HotWingConspiracy: I'm really surprised to find you here upset that anti-fraud measures continue to produce results. You'd think with Medicare waste being your pet gripe, this would be welcome news.


If Medicare waste gets don't to ridiculously low levels, it gets harder to get rid of medicare under the guise that it is wasteful.
 
2012-05-10 01:08:49 PM

aharown: ONLY 5.6 billion? does no one else think that # is pretty low? the system is incredibly filled with cheats.


Incredibly filled with cheats because. . . how do you know? Someone told you? Saw it on TV? You know some people who cheat?

Might I recommend a healthy habit? When data and hyperbolic political rhetoric (always heavily flavored with personal anecdotes) don't agree, trust the data. There are no guarantees, as data is easy to manipulate, but odds are the guy in the suit with an agenda screaming about how our world is falling apart is probably not your most reliable source.
 
2012-05-10 01:11:59 PM

Publikwerks: You need statistical analysis and computers to tell you that 1000 scripts for one person is off?


No, you need statistical analysis and computers to FIND 1000 scripts for one person. Do you think they did that in 1 bulk order?
 
2012-05-10 01:12:06 PM

omnibus_necanda_sunt: One thing about the cost of drugs I hadn't realized:

They actually have each chemical plant only perform one or two steps of the synthesis at a time. Then they ship it to other plants to go through the rest of the steps. I thought it was basically all done in one location with your basic ingredients (phenols, alcohols, amines, aromatics) turned into a finished product.

When they're shipping the 1,2,3,4,5,6,7,8,9-phenylbenzylarylalylthiodioleneaneone or whatever the fark between plants, it racks up costs like crazy.


THAT STUFF SAVED MY LIFE
 
2012-05-10 01:12:15 PM

impaler: If Medicare waste gets don't to ridiculously low levels, it gets harder to get rid of medicare under the guise that it is wasteful.


Ah, someone understands the Republican platform.

Here in MA, I still remember how they (Acting Biatch Jane Swift, specifically) gutted welfare. Did I say they gutted welfare? I'm sorry, I meant to say they eliminated -- not gutted, eliminated -- the welfare fraud investigation department.
 
2012-05-10 01:34:53 PM
i1.kym-cdn.com
 
2012-05-10 01:49:28 PM
I wonder what the amount of actual fraud was, i.e. false positive rate.
 
2012-05-10 01:55:20 PM

MusicMakeMyHeadPound: Flab: MugzyBrown: Hopefully these new analysis tools will allow them to start rejecting claims as they come in, or at least ask the claimant for additional justification in suspicious cases ("Hm... This Dr. House from New Jersey seems to prescibe a lot of Percocet"), just like banks and phone companies are now doing when they see irregular transaction patterns.

Great.

You of course know the result of this is 10% of claims will be unnecessarily rejected by a computer and the process to get your legit claim 'unrejected' will take 3 weeks and the filling of several forms.

So the alternative is to let fake drug stores abuse the system?

The system doesn't have to deny the claims completely. It can set a temporary limit until the pharmacist can justify why his customers buy 5 times the national average of drug X.

And if the customer, who legitimately needed that amount of X, dies while "being choked by government bureaucracy"?

Obviously no one wants to be defrauded and no one wants to see anyone die needlessly, but there's a certain urgent time constraint to medical care versus a seven year statute of limitations on fraud -- so yes, I'd rather the fake drug store temporarily abuse the system (and get punished for it later).


There's no need to completely deny the payment requests, but maybe tell the drug store that it must include copies of the prescriptions with the claims, until it can justify why it sells 5 times more drug X than the other stores in its area. There may be a good reason (ex: it's next to a free STD screening clinic, so it's normal that it would sell more Valtrex than your regular neighborhood CVS).

[CSB]
When I went on my honeymoon, I called both VISA and MC to see if there were problems with using them in Eastern Europe. One of the two said "Thanks for letting us know, we would have probably blocked the card otherwise". The other one said, "Nah... it's ok, we already see charges for a tux rental, large payment to a hotel, and a travel agency. Our system recognizes those and expects trip-related expenses next".
[/CSB]

And that was 6 years ago, before analytics became a buzzword. Newer systems would probably include GIS data and other variables to account for possible explanations to deviations from the trends. If Big Pharma already analyses that data to tell its sales rep which dr. and/or which pharmacists they need to pay a visit to, there's no reason why the Feddle Gummint wouldn't be able to do the same.

I don't think Grandma risks being denied her arthritis meds by HAL, yet.
 
2012-05-10 02:40:47 PM

Death_Poot: dittybopper: Luckily, a quick phone call to the supervising pharmacist at the place, who knew us and our special circumstances, cleared that up, and the guy apologized.

Good thing you weren't at a CVS.......


It was a KMart, oddly enough.
 
2012-05-10 02:44:32 PM

impaler: Why

computers statistical analysis is awesome

FTFY subby.

Computers are just a tool.


To be fair, so is statistical analysis.
 
2012-05-10 02:50:56 PM

Flab: There's no need to completely deny the payment requests, but maybe tell the drug store that it must include copies of the prescriptions with the claims, until it can justify why it sells 5 times more drug X than the other stores in its area. There may be a good reason (ex: it's next to a free STD screening clinic, so it's normal that it would sell more Valtrex than your regular neighborhood CVS).


Oh. So it's ignorance then (by which I simply mean lack of exposure to information). That's like the cornerstone of every anti-fraud program. I thought you were suggesting something more extreme.

When I worked in health insurance I worked pretty closely with NY State and Federal MMS people. Believe it or not, they're quite competent. However, as other commenters have noted, there's a lot of dirty politics that often tie their hands. Blame your (usually Republican) Congresscritter and the lobbyists who blow them.
 
2012-05-10 02:59:43 PM

Jon Snow: Computers are just a tool.

To be fair, so is statistical analysis.


Life isn't fair!
 
2012-05-10 03:23:36 PM

impaler: If Medicare waste gets don't to ridiculously low levels, it gets harder to get rid of medicare under the guise that it is wasteful.


Then let's do something about it. the estimated 60 Billion that is lost every year in fraud would be a nice addition to helping the defict. Might kill Florida's economy, though.

/Conservative
 
2012-05-10 03:40:38 PM

HeadLever: impaler: If Medicare waste gets don't to ridiculously low levels, it gets harder to get rid of medicare under the guise that it is wasteful.

Then let's do something about it. the estimated 60 Billion that is lost every year in fraud would be a nice addition to helping the defict. Might kill Florida's economy, though.

/Conservative


This. Well, except that CMMS funding doesn't come from the discretionary budget, which is where the deficit exists.

So I have to revise that to "Not this, stupid."
 
2012-05-10 03:50:10 PM

dragonchild: Why the fark does it have to be ten flat screen TVs? Couldn't you have just said, "Hm, hadn't thought of that," instead of roaring out of the gate by taking reductio ad absurdum to derpy extremes?


Because that's what the whole "ad absurdum" part means?
 
2012-05-10 03:52:47 PM

SFSailor: Good.

The more troubling thing they need to address is the whole "pay the first to bill for one" problem: There are tests / exams / etc that Medicare limits to specific time periods (as in, "can only get x test every y months," say)*, but the first organization to bill for it gets paid.... even if it's poorly done, worthless or misinterpreted. The organization stuck cleaning up after some idiot doctor / RT / whatever and re-doing the test can't bill and often has to eat the cost.


Yeah because there is no way that this could lead to an area of GINORMOUS fraud. "Yeah the last 5 tests that were run where all ran by idiots so pay me and I'll do the test again".
 
2012-05-10 03:58:00 PM

HotWingConspiracy: I'm really surprised to find you here upset that anti-fraud measures continue to produce results. You'd think with Medicare waste being your pet gripe, this would be welcome news.


Results? What results? They've found out the money was stolen from the Medicare prescription program at a rate roughly equivalent to the rate it's stolen from the rest of Medicare (and state-level Medicaid).

They didn't actually get any of this money back. And there is no indication they're changing their ways so the money isn't stolen in the first place.

What we've gotten is much better documentation of how many horses left the barn, and a really nice picture of the still-open barn door that let them leave.
 
2012-05-10 04:20:54 PM

MusicMakeMyHeadPound: This. Well, except that CMMS funding doesn't come from the discretionary budget, which is where the deficit exists.

So I have to revise that to "Not this, stupid."


You are 100% wrong to assume only discretionary budgets impact our deficts. Many off-budget items and manditory spending items have huge impacts upon our deficits. Don't forget that the deficit last year was about the same magnitude as the entire discretionary spending last year (about 1.3 Trillion). Total federal spending was more around 3.5 Trillion.
 
2012-05-10 04:54:45 PM

TNel: Yeah because there is no way that this could lead to an area of GINORMOUS fraud. "Yeah the last 5 tests that were run where all ran by idiots so pay me and I'll do the test again".


There's no good (or at least no easy answer) but you have to admit, "dipshiat physician in bumfark, MO did a stack of tests -incorrectly-, mistreated the patient, who then went to a specialist who had to re-do the tests -correctly- and solve the problem" shouldn't reward the first biller and stick the second with the choice of "use poorly-executed tests / procedures / whatever to diagnose or eat the cost of re-doing them."

Right?

Further, the flip-side data are there: "This operation bills for x procedure in an unusual number of cases / in unusually-short intervals / from every previous provider, not just a problematic one / etc." So it should work both ways.

The data is all there -- which doctors / organizations have good outcomes (granted, this information is not clear cut -- an operation seeing high-risk patients and those whose treatments were mishandled elsewhere will have worse first-impression numbers than a place that screens and treats only high-success patients, doesn't accept Medicare, etc), which have bad ones. The data should be able to tell us which labs/MDs/techs/etc are reliable and which are not. It may take an expert-MD adjudicator (though, over time, I would hope data analysis would automate or at least help this) to assess extreme cases or appeals, but "we only allow one hyperdistroxanthanalysisgram every 2 years, and you already got yours" isn't the right answer, just the easy one. And easy answers are rarely the right ones, anyway.

Of course, ideally, we'd have -everybody-in-one-pool-and-database- so we could really move healthcare and its efficiencies forward based on real, solid long-term data, but as single-payer won't happen in our lifetimes, that will remain only a pipedream and Medicare will have to do the best it can with the information it has.

[Added bonus: That would eliminate the incentive for insurance companies *not* to provide preventive care for preventable diseases of the elderly, a gigantic unacknowledged cost to Medicare, but that's a digression here.]

/ though I do have concerns over the whole "admin pinheads practicing medicine without a license" in the management of healthcare but that's also a different rant
 
2012-05-10 05:04:53 PM

Flab: Gulper Eel: Profits?

I have nothing against profits, in fact, as an investor, I like companies to make a profit. But you made it sound like the 30% overhead was ALL going towards fraud prevention, and it's clearly not the case.


as a health insurance agent specialized in senior health care I've come to the opinion that ANY profit in health care is waste. All it is really is taxpayer money going directly to investors with no risk unless the companies are more criminal than usual.

Health care should NOT be a profit center, full stop. Its only societal function is to keep people productive. It is like arguing that roads should be owned and operated by for profit companies.

And that 4% figure above is for administrative costs. About 96 cents of every dollar paid into Medicare, Medicaid and the VA go to patient care compared with a mandated 80 cents for private comprehensive insurance. However fraud is part of the 96%.

I would rather have the waste and government death panels than the waste and corporate death panels. And they DO exist. A dozen executives go into a conference room with the files for everyone who has a claim above a certain amount or of a specific type and they might spend up to a minute deciding whether to honor each claim or not. Then someone else is tasked with finding a justification for denying disapproved claims. Obamacare eliminated their ability to just cancel or rescind policies without actual fraud. In my mind though it didn't go nearly far enough. These empty suits have been responsible for countless medical bankrupcies and premature deaths due to claims denials. And as the CEO of Wellpoint told an outraged Faux News audience, the insurance industry is completely incapable of self-reform even when their own numbers show that the system will be busted in a couple decades.

At least the government isn't beholden to the likes of Soros and Icahn. Life was one of those enumerated inalienable rights listed on the Declaration of Independence that governments have a moral duty to preserve.
 
2012-05-10 05:30:15 PM

Kazan: Gulper Eel

you realize that medicare's overhead (overhead includes fraud, operating costs, profit taking, etc) as a % of it's budget is around 4% ... the private insurers are around 30%


That's an accounting trick.
 
2012-05-10 05:43:24 PM

BolloxReader: However fraud is part of the 96%.


Not really.

No one really knows how much fraud goes on in these programs, however, it has been estimated by some to be on the order of $60 Billion per year just for Medicare. The total medicare budget this year is around $525 Billion. That is over 11%.
 
2012-05-10 06:06:59 PM

BolloxReader: And that 4% figure above is for administrative costs.


No it isn't. For instance, they don't count collecting the money as an expenditure because it is done by another department.
 
2012-05-10 06:16:37 PM
Its racist to point out fraud and waste by the government.
 
2012-05-10 06:25:36 PM

HeadLever: You are 100% wrong to assume only discretionary budgets impact our deficts.


Oh, so you're going by the unified budget as opposed to the traditional use of separating out mandatory items which have separate funding sources. Ok, in that case you're right, but I wished you had said so since that's a bit more esoteric.

Additionally, the decision to continue a tax cut in a recession has a lot more than $60 billion to do with deficit - Congress is heavily relying on people who've spent much of the year unemployed for funding.

No one really knows how much fraud goes on in these programs, however, it has been estimated by some to be on the order of $60 Billion per year just for Medicare.

"Some"? Fox News Weasel Word alert. Who, exactly?

The Office of Management and Budget puts a number of $28.8 Billion for Medicare in 2010 for improper payments [Source]

Also note that "Improper" runs the gamut from "I was overbooked that day and didn't take thorough notes on why I made that medical decision" to full blown fraud and doesn't even necessarily mean that money was lost [Source]
 
2012-05-10 06:48:25 PM

Kazan: Gulper Eel

you realize that medicare's overhead (overhead includes fraud, operating costs, profit taking, etc) as a % of it's budget is around 4% ... the private insurers are around 30%


No it doesn't. First estimated fraud is more then 4% second billing and payments are handled by the treasury. Third enforcement by doj. Fourthly collection by IRS. Your 4% is complete and utter bullshiat.
 
2012-05-10 07:03:34 PM

MusicMakeMyHeadPound: Oh, so you're going by the unified budget as opposed to the traditional use of separating out mandatory items which have separate funding sources.


Of course. When you talk about the trillion dollar deficits that have been the norm for the last couple of years, that is what you are talking about. I have never heard of any deficit characterization intended only for discretionary buget.

Additionally, the decision to continue a tax cut in a recession has a lot more than $60 billion to do with deficit -

True but that was not my arugment. You are moving the goalpost. As a note, tax cuts will not solve the deficit problem either. Maybe we fix taxes AND do something about Medicare fraud.

"Some"? Fox News Weasel Word alert. Who, exactly?

60 Minutes
 
2012-05-10 07:11:01 PM

MusicMakeMyHeadPound: Office of Management and Budget puts a number of $28.8 Billion for Medicare in 2010 for improper payments


Oh, and you may want to continue to scroll down your list and add up all the other parts of the Medicare stuff you conveniently missed.
 
2012-05-10 08:40:12 PM

HeadLever: [Additionally, the decision to continue a tax cut in a recession has a lot more than $60 billion to do with deficit - ]

True but that was not my arugment. You are moving the goalpost.


I know it wasn't your "arugment". It was my argument. That's why I used the word "additionally".

As a note, tax cuts will not solve the deficit problem either. Maybe we fix taxes AND do something about Medicare fraud.

Well, yes, and additionally (note: I am inserting another argument here, not moving the goalposts) the real elephant in the room is military spending.

["Some"? Fox News Weasel Word alert. Who, exactly?]

60 Minutes


Let's apply some critical thought here: which do you think is going to be more accurate? A news piece reporting on a crisis in 2010 or an accounting report on the same period after the dust has settled?

Oh, and you may want to continue to scroll down your list and add up all the other parts of the Medicare stuff you conveniently missed.

Lulz. And you complain about me moving goalposts. It comes out to $42.9 Billion in improper payments. Still well short of the $60 Billion figure and it comes with the footnote that it does not constitute fraud.
 
2012-05-10 08:57:03 PM

Gulper Eel: Flab: Gulper Eel: Profits?

I have nothing against profits, in fact, as an investor, I like companies to make a profit. But you made it sound like the 30% overhead was ALL going towards fraud prevention, and it's clearly not the case.

Not my intent, sorry.

It is pretty clear that even a small anti-fraud investment by Medicare would yield huge savings...especially if they stopped the fraud BEFORE the money was gone, for a change.

Unfortunately, Medicare uses this thoroughly silly "pay-and-chase" system where they cut the checks first and ask questions later. We are forever hearing from various government functionaries that pay-and-chase is going to go away, but articles like this one make it pretty clear that it's not going to happen at any serious level any time soon.


I don't know about that man. In my current line of work, Medicare has decided that it's just fine and dandy to deny payment AFTER services have been performed - and they don't even have to tell you why!
 
2012-05-10 10:06:20 PM

MusicMakeMyHeadPound: Let's apply some critical thought here: which do you think is going to be more accurate? A news piece reporting on a crisis in 2010 or an accounting report on the same period after the dust has settled?


Since no one really knows, I would have a hard time saying. They are all estimates. And what crisis are you talking about? I am not sure what really blew up in Medicare in 2010.

And you complain about me moving goalposts....Still well short of the $60 Billion figure and it comes with the footnote that it does not constitute fraud.

Not exactly sure how calling you out for not adding up your own source is moving the goalpost. In any case, these are estimates as well. Who knows which one is correct.

That being said, even if your 'modified' number is correct, this is still a huge amount of money (about $125 per citizen in the U.S).
 
2012-05-11 12:53:07 AM
They did not find $5.6 billion of fraud,
'"While some pharmacies may be billing extremely high amounts for legitimate reasons, all warrant further scrutiny," said the report. Medicare paid $5.6 billion to drugstores whose billings are being questioned.'

They paid $5.6 billion to a bunch of drugstores, some fraction of which is most likely fraudulent.
 
2012-05-11 03:40:30 AM

Radiolarian Chert Ripped My Tires: They paid $5.6 billion to a bunch of drugstores, some fraction of which is most likely fraudulent.


Some = pretty much all of it.

Were the feds to follow up and go to one of these "drugstores" they would find...an empty storefront and no sign that a drugstore of any kind had ever been there.
 
2012-05-11 10:27:57 AM

Gulper Eel: HotWingConspiracy: I'm really surprised to find you here upset that anti-fraud measures continue to produce results. You'd think with Medicare waste being your pet gripe, this would be welcome news.

Results? What results? They've found out the money was stolen from the Medicare prescription program at a rate roughly equivalent to the rate it's stolen from the rest of Medicare (and state-level Medicaid).

They didn't actually get any of this money back. And there is no indication they're changing their ways so the money isn't stolen in the first place.

What we've gotten is much better documentation of how many horses left the barn, and a really nice picture of the still-open barn door that let them leave.


Wrong dumb fail stupid. Do you not read the papers? The crackdowns on Medicare fraud are getting quite harsh. Here in Texas the "90 people were indicted..." headlines pop up at least once a month now.

They bust the doctors, the nursing home directors, the pharmacy owners, even the ambulance services. It is enough to scare the rest of the free riders into straightening up.
 
2012-05-11 11:07:45 AM

Breathe Laugh Twitch: Gulper Eel: HotWingConspiracy: I'm really surprised to find you here upset that anti-fraud measures continue to produce results. You'd think with Medicare waste being your pet gripe, this would be welcome news.

Results? What results? They've found out the money was stolen from the Medicare prescription program at a rate roughly equivalent to the rate it's stolen from the rest of Medicare (and state-level Medicaid).

They didn't actually get any of this money back. And there is no indication they're changing their ways so the money isn't stolen in the first place.

What we've gotten is much better documentation of how many horses left the barn, and a really nice picture of the still-open barn door that let them leave.

Wrong dumb fail stupid. Do you not read the papers? The crackdowns on Medicare fraud are getting quite harsh. Here in Texas the "90 people were indicted..." headlines pop up at least once a month now.

They bust the doctors, the nursing home directors, the pharmacy owners, even the ambulance services. It is enough to scare the rest of the free riders into straightening up.


I see plenty of those stories too. It's edge-nibbling. That's how widespread the fraud is.

The people stealing the bulk of the money aren't in the health care business. They're in the stealing-things business.

This is how bad it is in south Florida...

The number repeated by most government agencies is that about 10% of CMS's expenditures are lost through fraud and "improper payments." The Government Accountability Office (GAO), the investigative arm of Congress, repeatedly labels Medicare and Medicaid "high-risk programs" because their size and complexity make them so vulnerable to fraud, waste, and abuse. CMS itself estimates that in 2010 it made a total of more than $48 billion in improper payments in Medicare, and another $22 billion in Medicaid. That's about 10% of the program's annual spending. (The FBI regularly estimates Medicare and Medicaid fraud at between 3% and 10%.) It's hard to imagine any private business enduring long-term fraud losses at that level.

Yet it may be far worse than that. Malcolm Sparrow, perhaps the leading academic on health-care fraud, says CMS estimates are almost certainly wrong. "The history of the 10% figure is that it came from a GAO report from the mid-1990s," Sparrow, the chair of the executive program on regulation and enforcement at Harvard's John F. Kennedy School of Government, explains. "If you track it down--and I did--it says in that GAO report that 'some industry experts believe the loss rate could be 10%.' And because that appeared in a government report, even in an extremely vague form, it was enough to justify using it." The figure stuck because it was convenient, Sparrow surmises. "Ten percent I think served the political purpose for a good long time," he says. It was big enough so that it didn't look like people were in denial, but "not so huge as to be a public embarrassment."

Sparrow, for one, has no doubt the figure is higher. He just doesn't know by how much.


Besides, if the enforcement is so magnificently effective, where's the commensurate slowdown in Medicare spending?
 
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