Is Technology Perpetuating Medicare Fraud?

Scott Mace, for HealthLeaders Media , December 11, 2012

But since fee-for-service isn't exactly going away tomorrow, how much taxpayer and insurance money is at risk of being wasted before that day arrives? What interim steps need to be taken to minimize that waste?

Whatever the merits of the 60 Minutes report, bringing these allegations to light is appropriate. During a conference call held last week by the Patient-Centered Primary Care Collaborative, Paul Grundy, the organization's president, commented that "There's just so much data now that's becoming available that it's going to be increasingly hard to do the kinds of things that you saw on 60 Minutes. If there's one thing I could say to hospital systems like that, you're either part of the problem or you're part of the solution, and increasingly, if you want to insist on being part of the problem, you're going to get caught. You're going to go out of business. It's criminal."

HMA says its admission rates show no spike from industry averages. While time and the courts will weigh in on that matter, I think it remains to be seen if the data now out there is sufficient to catch fraud. My experience with software over the past three decades says that there are lots of devious ways to engineer fraud into a system. The question is whether CMS and the Justice Department have sufficient resources to smoke it out.

Farzad Mostashari, the national coordinator for health information technology at the Department of Health and Human Services, recently weighed in on allegations of upcoding, i.e., billing for care that wasn't delivered. "It doesn't matter if you do it on paper, if you do it through voice, whether you do it through transcription service, or you do it through an electronic health record. That's fraud and we take that very seriously," Mostashari said at a policy meeting of the Office of the National Coordinator.

But when fraud has the potential to be perpetrated on such a massive scale, aided and abetted by technology, can the regulators keep up?

Editor's Note:  A prior version of this article attributed certain comments to Paul Grundy, MD, president of the Patient-Centered Primary Care Collaborative. His actual remarks were made about hospital systems generally and were not specific to HMA or any particular hospital system.  IBM confirms that HMA hospitals continue to be available for use by its employees under its health plans.

Scott Mace is senior technology editor at HealthLeaders Media.
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