by Deb Cupples | According to the New York Times, Sen. Max Baucus (Finance Committee chairman) has a 35,000-word proposal for health care reforms that seems to aim for universal coverage. You can read a synopsis of Baucus' plan here.
Nobel Prize winning economist Paul Krugman sees this as a "hopeful sign":
"[N]ow Max Baucus — Max Baucus! — is leading the charge on a health care plan that, at least at first read, is more like Hillary Clinton’s than Barack Obama’s; that is, it looks like an attempt at full universality. (The word I hear, by the way, is that Obama’s opposition to mandates was tactical politics, not conviction — so he may well be prepared to do the right thing now that the election is won.)
"So this looks very good for the reformers. There’s now a reasonable chance that universal health care will be enacted next year!" (Krugman blog)
I can already hear resistance, things like: But where will the money come from?
That's a valid question, given that our nation faces enormous economic crises -- coupled with the fact that the Bush Administration and Congress seem eager to funnel billions of tax dollars to the some of the same corporate executives who helped drive their companies and our nation's economy into a ditch.
I have a partial solution: let's truly crack down on health-care-contractor waste, fraud, and abuse. No kidding. Every year, some health-care contractor or another ends up prosecuted by the Justice Department for allegedly defrauding us taxpayers.
Every year, some health-care contractor or another ends up settling such cases for millions of dollars. For example, a recent Justice Department press release says this:
"The United States secured $1.34 billion in settlements and judgments in the fiscal year ending Sept. 30, 2008, pursuing allegations of fraud against the federal government, the Justice Department announced today....
"As in the last several years, health care accounted for the lion's share of fraud settlements and judgments [i.e., recoveries] -- $1.12 billion."
Funny, a Justice Department spokesperson said the same thing in 2003: that health care accounted for the "lion's share" of fraud settlements/judgments. I guess that alleged fraud is still rampant and still diverting tax dollars away from our nation's actual health care needs.
The $1.12 billion that Justice recovered this year from health care contractors may seem like small change, but keep two things in mind:
1) Recoveries came only from contractors that got caught and prosecuted
2) Recoveries may be smaller than the actual amounts that contractors allegedly cheated us taxpayers out of.
Every dollar that goes toward waste, fraud or abuse is one less dollar to spend on health care for Americans who need it. Period.
Below is an example of recoveries in 2008 from just two lawsuits involving the same drug company:
"$361.5 million from Merck & Company to resolve allegations that the pharmaceutical manufacturer knowingly failed to pay proper rebates to Medicaid and other government health care programs, and paid kickbacks to health care providers to induce them to prescribe the company’s products. The settlement resulted from two lawsuits brought under the qui tam provisions of the False Claims Act.
"In the first, which accounted for $221.9 million of the $361.5 settlement, a former Merck employee alleged that the company violated the Medicaid Rebate Statute by providing deep discounts to hospitals that used its drugs Zocor and Vioxx in place of competitors’ brands, without reporting those discounts and other cost information to reflect its 'best price,' as required by the statute to ensure that Medicaid obtains the benefit of the same price concessions other purchasers enjoy. This suit also alleged that Merck paid kickbacks to physicians, disguised as fees for training, consultation, and market research, to induce them to prescribe its drugs, also contrary to law....
"In the second lawsuit, which accounted for the remaining $139.6 million of the settlement, a physician alleged that Merck provided deep discounts to hospitals to induce them to administer its antacid, Pepcid, as a means to boost sales through continued use after the patient’s discharge. The suit went on to allege, similar to the first suit, that Merck knowingly failed to report these discounts as required by the Medicaid Rebate Statute, which resulted in illegal and inflated claims to federal and state Medicaid programs. (Justice Dept.)
To give you an idea of what alleged fraud looks like and how much it can cost, I've included below more than a dozen examples of healthcare-industry players that faced lawsuits or prosecution, their alleged conduct, and the outcomes.
Hospitals
In 2006, Tenet Healthcare (America's second largest for-profit hospital chain) settled DoJ suits for $900 million after allegedly false billing of Medicare and other federal programs. The alleged conduct included: "upcoding" patient diagnoses (billing for more expensive treatment than was done or called for), unreasonable inflation of charges, and illegal kickbacks to doctors.
In 2005, Health South settled DoJ suits for $327 million after allegedly charging for false claims for outpatient physical therapy, over-billing Medicare for hospital costs, and billing Medicare for unallowable costs (like employee travel, entertainment, and an administrator's meeting at Disney World).
By 2003, HCA (America's largest hospital chain) had agreed to pay $1.7 billion to settle DoJ suits. The alleged conduct included: falsifying hospital-cost reports, charging Medicare for unallowable costs, and giving doctors illegal kickbacks for patient referrals. Some of the alleged conduct dated back to the 1980s.
Drug Companies & Pharmacies
In 2005, GlaxoSmithKline settled a DoJ suit for $140 million after allegedly submitting false claims to Medicare and other federal programs by falsely reporting inflated drug prices -- "knowing that those prices would be used by federal programs to set reimbursement rates."
Retail pharmacies Wal-Mart (2004) Rite Aid (2004), Eckerd (2002), and Walgreen (1999) settled unrelated DoJ suits for a combined $23.4 million after allegedly charging federal healthcare programs full price for partially filled prescriptions. Federal programs including Medicare, Medicaid and TRICARE (military health) were affected.
In 2003, AstraZeneca settled DoJ suits for $280 million after allegedly conspiring with healthcare providers to charge federally funded insurance programs for free samples of a prostate cancer drug.
Laboratories
In 2003, Abbott Laboratories settled DoJ suits for $382 million after getting snared in a federal undercover investigation called “Operation Headwaters." Apparently, a division of Abbot had offered kickbacks to federal agents to buy the company’s products, then “advised them how to fraudulently bill the government for those items.”
In 2002, four individuals in Florida were sentenced to prison and ordered jointly to pay a total of $11.7 million after conspiring to defraud Medicare and Medicaid by submitting false claims for laboratory tests that were not actually performed.
In 1997, SmithKline Beecham laboratories settled a DoJ fraud suit for $325 million after allegedly over-billing Medicare and other federal programs by: double billing for tests for kidney dialysis patients; paying illegal kickbacks to doctors; and billing for tests that weren’t done, weren’t medically necessary, or weren’t ordered by a doctor.
HMOs & Insurance Companies
In 2002, General American Life settled a Medicare-fraud case for $76 million after allegedly failing to perform its contractual duties to the Centers for Medicare and Medicaid Services (CMS). The duties included assessing eligibility and processing claims submitted by Medicare beneficiaries and healthcare providers. General American allegedly failed to process claims, submitted false information to CMS, failed to report errors, and disguised true error rates by deleting claims selected for CMS-review.
In 2002, PacifiCare Health Systems agreed to pay $87 million to settle allegations that it (and its predecessor companies) had inflated insurance claims while contracted to provide government-employee benefits under the Federal Health Benefits Program.
In 2004, Lovelace Health Systems, (a Cigna-owned hospital and HMO) settled a DoJ suit for $24.5 million after allegedly falsifying Medicare cost reports for ten years. Among other tactics, the company reportedly shifted the costs of its HMO patients to Medicare.
Equipment Suppliers
In 2000, an Ohio medical supplier was ordered to pay $15.1 million and sentenced to 70 months in prison after pleading guilty to defrauding Medicare by billing for urinary incontinence supplies that were not provided and by falsifying paperwork to hide the schemes from Medicare.
In 1997, Olympus of America settled a DoJ suit for $22.8 million after allegedly overcharging the Department of Veterans Affairs (VA) for medical-imaging equipment. After the VA negotiated to receive the best discount that Olympus offered to private businesses, Olympus reportedly told the VA that it gave no discounts to private businesses (when Olympus did give discounts), thereby overcharging the VA according to the contract's terms.
Doctor Fraud
In 2004, a Connecticut pediatrician pleaded guilty to fraud and agreed to pay back $548,000 after billing Medicaid and other insurance programs for childhood vaccines that the doctor had received free-of-charge via the joint federal/state Vaccines For Children program. The doctor reportedly carried out the scheme from 1997-2002.
In 2000, a Texas doctor and his lawyer brother were convicted and sentenced to prison after carrying out a "sophisticated scheme to defraud local, state and federal heath programs and private insurers of over $46 million from 1986 to 1998." In the process, the doctor upcoded his services, falsified medical reports and engaged in multiple billing. During 1994, he would have had to work for 90 hours a day to accomplish the number of office visits he'd billed for. The scheme's other participants included an accountant, a physician's assistant, a physical therapist, and multiple office managers.
In 2001, a U.S. doctor was sentenced to 10+ years' prison after conspiring to dispense/distribute controlled substances, committing Medicare fraud, and taking illegal kickbacks. He was also ordered to pay $229,384 in restitution. Reportedly, the doctor routinely wrote large quantities of prescriptions for highly addictive pain medication, billed Medicare for services not provided, and upcoded office visits. A pharmacy owner was also convicted, sentenced to 16 years' imprisonment and fined $56,400.
.
In 2004, four California defendants were convicted after participating in a scheme to defraud Medicare of $2.6 million for equipment -- including motorized wheelchairs, accessories, and hospital beds -- that were not medically necessary or were not delivered. The defendants included a doctor, a wheelchair store owner, and a wheelchair repair-shop owner.
Memeorandum has commentary.
Other Buck Naked Politics Posts:
* Insurance Companies Get Away with Overbilling Medicare
* Oversight Committee Probes Waste/Abuse re: Medicare Part D Pricing
* Waxman Wants Executive Pay Data from Banks Getting Bailout Funds
* Are Bailout Funds Being Misused?
* Cutting Executive Pay Would Save Jobs
* Lehman Execs Redistribute Shareholder Wealth (to Themselves)
* AIG Execs Redistribute Shareholder Wealth (to Themselves)
* Execs Made Millions While Driving Companies into Ditch
.
The Call to Action/Health Care Reform 2009 proposal released 11/13/08
(http://www.finance.senate.gov/) by Senator Max Baucus is a disaster.
The Baucus plan is an expansion and continuation of the status-quo
mixture of a government subsidized ineffective private health
maintenance insurance industry operating parallel to and within Medicare
Insurance.
7 Specific Reasons Why the Baucus Health Reform 2009 Plan Fails.....
1) The Baucus plan fails to enroll all Americans in a single payer
National Health Insurance such as the most efficient health insurance
plan (Medicare) which is already contracted with most doctors,
hospitals and clinics in the Country. Medicare has the lowest operating
expenses and the best morbidity (sickness rates) and mortality (death
rates) compared to all other insurance companies. The Baucus plan will
therefore divert $700 Billion to $1 Trillion per year away from
patients, hospitals, doctors, clinics, nurses, pharmaceuticals,
therapist and researchers into the overhead pockets of health private
insurance company administrators and executives.
2) The Baucus plan fails to technologically upgrade, integrate and
centralize medical billing and records systems in order to optimize
examination of clinical outcomes, pharmaceutical efficacies and monitor
fraud and abuse. In addition, by failing to centralize and
technologically upgrade billing and records systems within a single
National Health Insurance plan, America will be unable to instantly
monitor disease outbreaks and instantly respond to natural and man made
disasters or bio-nuclear terrorism..
3) The Baucus plan fails to control drug costs by failing to allow a
single efficient national health insurance company such as Medicare to
bid on pharmaceuticals. In addition, the Baucus plan by failing to put
all Americans on a National Health Insurance Plan such as Medicare does
little to shrink the 'risk pool' of insured, thereby failing to decrease
insurance premium expenses for all Americans.
4) The Baucus plan fails to provide funding for scientific, clinical and
epidemiological research and development by allowing private private
insurance companies to divert funds from medical research and
development to instead support their massive and profitable
administrative and executive bureaucratic overheads.
5) The Baucus plan fails to provide physicians with the same legal
protection from malpractice lawsuits which have been established for
commercial health insurance corporations during the last 3 decades.
6) The Baucus plan fails to explain where to find the 1.5 million new
health care workers which will be needed once 100 million new Americans
obtain health care insurance. Health care workers can be found easily by
shutting down the wasteful and inefficient private health insurance
companies, putting all Americans on National Health Insurance such as
Medicare. The 1.5 million former private insurance company bureaucrats
can then be reemployed to actually deliver health care in hospitals,
clinics, nursing homes, assisted living facilities, pharmacies and home
health services such as Alzheimer family assistance.
7) The Baucus Plan fails to address this problem of disenfranchised
physicians. Many physicians in this country have left the practice of
medicine, or downsized their practices due to private insurance company
abuses, malpractice threats and direct pharmaceutical marketing. A
recent national poll of physicians based on the AMA database
demonstrated that 60% of physicians support a single payer National
Health Insurance such as Medicare. A continuation and technological
upgrading of our most fair Medicare Health Insurance for all based on
the concepts outlined above would undoubtedly motivate those
disenfranchised physicians to return to the profession and bright
younger physicians to invigorate the field.
The Baucus plan is wasteful, inefficient, fragmented, creates a new
redundant bureaucracy and will continue to provide no potential future
health improvements for America. Only an efficient National Health
Insurance carrier such as a technologically upgraded Medicare Insurance
company will be able to provide low cost health insurance and pharmaceuticals
for all Americans while maintaining the quality of private physician practices and Hospitals.
H. Green, MD, FACP, FAAD, FACMS
http://www.pnhp.org/news/2008/february/what_government_does.php
Posted by: H. Green, MD | November 23, 2008 at 10:09 PM
The Call to Action/Health Care Reform 2009 proposal released 11/13/08
(http://www.finance.senate.gov/) by Senator Max Baucus is a disaster.
The Baucus plan is an expansion and continuation of the status-quo
mixture of a government subsidized ineffective private health
maintenance insurance industry operating parallel to and within Medicare
Insurance.
7 Specific Reasons Why the Baucus Health Reform 2009 Plan Fails.....
1) The Baucus plan fails to enroll all Americans in a single payer
National Health Insurance such as the most efficient health insurance
plan (Medicare) which is already contracted with most doctors,
hospitals and clinics in the Country. Medicare has the lowest operating
expenses and the best morbidity (sickness rates) and mortality (death
rates) compared to all other insurance companies. The Baucus plan will
therefore divert $700 Billion to $1 Trillion per year away from
patients, hospitals, doctors, clinics, nurses, pharmaceuticals,
therapist and researchers into the overhead pockets of health private
insurance company administrators and executives.
2) The Baucus plan fails to technologically upgrade, integrate and
centralize medical billing and records systems in order to optimize
examination of clinical outcomes, pharmaceutical efficacies and monitor
fraud and abuse. In addition, by failing to centralize and
technologically upgrade billing and records systems within a single
National Health Insurance plan, America will be unable to instantly
monitor disease outbreaks and instantly respond to natural and man made
disasters or bio-nuclear terrorism..
3) The Baucus plan fails to control drug costs by failing to allow a
single efficient national health insurance company such as Medicare to
bid on pharmaceuticals. In addition, the Baucus plan by failing to put
all Americans on a National Health Insurance Plan such as Medicare does
little to shrink the 'risk pool' of insured, thereby failing to decrease
insurance premium expenses for all Americans.
4) The Baucus plan fails to provide funding for scientific, clinical and
epidemiological research and development by allowing private private
insurance companies to divert funds from medical research and
development to instead support their massive and profitable
administrative and executive bureaucratic overheads.
5) The Baucus plan fails to provide physicians with the same legal
protection from malpractice lawsuits which have been established for
commercial health insurance corporations during the last 3 decades.
6) The Baucus plan fails to explain where to find the 1.5 million new
health care workers which will be needed once 100 million new Americans
obtain health care insurance. Health care workers can be found easily by
shutting down the wasteful and inefficient private health insurance
companies, putting all Americans on National Health Insurance such as
Medicare. The 1.5 million former private insurance company bureaucrats
can then be reemployed to actually deliver health care in hospitals,
clinics, nursing homes, assisted living facilities, pharmacies and home
health services such as Alzheimer family assistance.
7) The Baucus Plan fails to address this problem of disenfranchised
physicians. Many physicians in this country have left the practice of
medicine, or downsized their practices due to private insurance company
abuses, malpractice threats and direct pharmaceutical marketing. A
recent national poll of physicians based on the AMA database
demonstrated that 60% of physicians support a single payer National
Health Insurance such as Medicare. A continuation and technological
upgrading of our most fair Medicare Health Insurance for all based on
the concepts outlined above would undoubtedly motivate those
disenfranchised physicians to return to the profession and bright
younger physicians to invigorate the field.
The Baucus plan is wasteful, inefficient, fragmented, creates a new
redundant bureaucracy and will continue to provide no potential future
health improvements for America. Only an efficient National Health
Insurance carrier such as a technologically upgraded Medicare Insurance
company will be able to provide low cost health insurance and pharmaceuticals
for all Americans while maintaining the quality of private physician practices and Hospitals.
H. Green, MD, FACP, FAAD, FACMS
http://www.pnhp.org/news/2008/february/what_government_does.php
Posted by: H. Green, MD | November 23, 2008 at 10:09 PM