I found this on Facebook. It's about fraud, specifically Medicaid and Medicare fraud, and where it's coming from and how to defeat it.
It's an opinion piece, but I think he is correct. What do you think?
--Kim
I've been thinking a lot about Medicaid and Medicare fraud.
Just to state the obvious: There is TONS of fraud in these programs. Sometimes progressives will quixotically respond to right-wing attacks by saying "actually there's very little fraud in these programs"--absurd, silly thing to say. They're gigantic programs, they spend hundreds of billions of dollars. We have no idea how much fraud there is but large-scale frauds get identified and prosecuted all the time.
Very little of this fraud is *by beneficiaries*, though. Like there are not a ton of people who are actually 64 pretending to be 66 in order to get free checkups from Medicare.
The kind of fraud that happens is all *provider* fraud. The ideal-typical Medicare/Medicaid fraud there is something like: You're a doctor who is also a criminal, and you have a shitty little doctor's office where you try to earn enough to pay your gambling debts. At some point you realize that Medicare is paying doctors $500 a pop to do some specific procedure--wart removal or whatever. You go out looking for people with warts, and advertise a free coffee with each wart removal. But even with the ad spend you're only doing like three wart removals a week. Then it occurs to you: Does Medicare actually check if a wart was removed? Are there Medicare police coming around and demanding to see the removed warts? Of course not--Medicare just pays. So you start billing a wart removal for every Medicare patient who walks through the door. You don't tell them they're doing it, you don't actually touch them, they don't have any reason to know. You just type it into the billing software and collect $500. Now you're billing, like, 100 wart removals a week, earning $50,000 a week or $2.6 million a year. Every once in a while a patient glances at their bill and asks about it, and you say "oh whoops that was an error," or "'wart removal' is a Latin medical term meaning 'check for warts'," and they shrug and move on with their day. It's a good living.
But you're a really *degenerate* gambling addict, and you need more. At a certain point you're wondering--I'm now billing a wart removal for every Medicare patient who walks through my door, but does anyone check who's walking through my door? What if I just went through my files, pulled every Medicare patient I've ever seen in the past 5 years, and billed for all of them? So you try that, nothing happens, you decide to remove an imaginary wart from every imaginary Medicare patient every three months, and now you're pulling in $10 million a year.
This is probably a bridge too far--you're billing for a bunch of dead people, eventually some software program will flag that. But there are gentler versions. Like, maybe you're not a degenerate gambler so much as an astute private equity analyst at a company that has purchased 800 dermatology practices, and you notice that Medicare actually has three prices for wart removal--$200 for simple wart removal, $500 for advanced wart removal, and $1,000 for advanced wart removal with complex conditions. And maybe the term "complex conditions" is a matter of clinical judgment--who's to know, really, what counts as complex? Isn't that between a patient and his doctor? And so you modify the billing software so that every wart removal turns out to have complex conditions, and your 800 clinics do like 2,000 wart removals a week, and now instead of paying $200 they're all paying $1,000, which is like $83 million a year. And when they come for you you'll say "well I see the jack-booted federal government thinks it knows how to judge the complexity of a wart better than our board-certified hard-working dermatologists!" And you probably settle out of court for, you know, a heartfelt commitment to improve diagnostic compliance and a monetary sum of less than $83 million.
Does the Medicare program, like, notice this stuff? I mean look: The Medicare program spends $850 billion a year, $2.3 billion a day, $97 million an hour. It pays tens of millions of medical bills every week, for everything from wart removal to chemotherapy to ambulance rides, in every corner of the US. Can the Medicare program distinguish between "this dermatology practice suddenly started billing a bunch of wart removals because it is running a huge scam?" and "this dermatology practice has specialized in removing warts and started running radio ads about its high-quality wart removals?" Eventually, probably, yeah. But not easily and immediately, no.
Here's the question: What do you want to *do* about all this? It's not an easy problem to solve. But there's certainly stuff you could do. Like for instance if you really wanted to prevent fraud before it happened you could require that before any doctor is allowed to bill Medicare for a complicated wart they need to mail in a picture of the wart with its complications highlighted in orange, and the picture is examined by a highly trained team of government anti-fraud dermatologists, and they could reject any wart that looked straightforward. Plausibly, though, people would whine about government red tape and interference with physician judgment when they learned they had to wait six weeks for wart removal approval, rather than thanking you for being a good steward of taxpayer money.
Alternatively, you could try to catch fraud faster. You could hire crack developers to build software that sifted Medicare claims data for anomalous wart claims. You could hire 1,000 new claims inspectors and clear the backlog of fraud detection pings so that the inspectors could investigate the first time someone tried to remove a wart from a dead guy, rather than the fiftieth. You could hire field office staff to go out to clinics and check for invisible warts.
You could do all this stuff, and we should do some of it. How much of it is an open question. The US government's programs are never going to get to zero fraud, any more than Amazon or Visa or Aetna gets to zero fraud, because there's a tradeoff between how much spending and red tape you're willing to impose and how much money you're saving through fraud detection, and once you get down to, like, 2% fraud ($17 billion a year, for Medicare) maybe it's just not worth it to make honest doctors suffer through pre-approval procedures just to prevent the last 2%. So there are always gonna be billions of dollars of fraud in Medicare. But plausibly there could be less billions than there are now, and plausibly there should be.
But if you think there should be less fraud--and here's what Republicans pretend not to understand in this context--you need to spend money to prevent fraud. It all costs fucking *money*. If you want to catch fraud you need to spend the money and hire the bureaucrats and build the systems to go after the fraud. Anti-fraud dermatologists and crack fraud detection data analysts and field office wart examiners are all hardworking civil servants who need to be paid.
So if you want to check whether someone gives a shit about reducing fraud in a government program, it's easy to do--just ask them if they're planning to significantly increase the staff budget for the program. If the answer is no (if, like the Trump administration, you just laid of tens of thousands of employees at HHS) then you're actually pro-fraud. The Trump administration is ringing in a golden era of Medicare fraud. It's a great time to open a dermatology practice.
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