Nicholas Bagley at the Incidental Economist passes along a clear case of fraud, waste and abuse at a massage clinic. He then laments the oversight process failing to catch the fraud at a low level and writes a simple, elegant paen to informatics that is completely useless:
What’s demoralizing is the familiarity of this story. Back in 1997, the D.C. Circuit issued another opinion involving a Washington, D.C. physician who claimed he worked more than 24 hours in a day. Any halfway-sophisticated computer system should have uncovered fraud this blatant. Well over a decade later, however, Wheeler was able to do exactly the same thing. Even then, it took an informant’s “tip” to clue officials into the fraud.
A good computer program can investigate oddities and identify outliers. It can’t prove fraud or even get a 2 sigma estimate of fraud.
There is something that he is missing. Claims payment and claims processing rarely reflects reality, especially when services are performed by mid-level clinicians. We saw this with the recent release of CMS Medicare claims data. Some of the highest paid individuals were truly performing all the services that they were getting paid for. However, others were medical directors of large studies or claims rolling up to a single NPI or Medicare ID:
Claims rolling up to a provider’s NPI or Medicare ID. Non-MD/non-D.O. clinicians such as Certified Nurse Practicioners, Physician Assistants, Master and Doctorate level Physical Therapists etc. often will roll their billing up to a doctor’s Medicare billing number. This means we can’t do a simple time management bullshit detection study based solely on “This provider is claiming he is doing 17 Medicare Part B procedures a day. Each of these procedures takes 30 minutes… IMPOSSIBLE”. That type of first level analysis might identify odd situations, but most will be explained by seeing three or four CRNPs/PAs doing most of the work that the doctor than bills for.
The story that Bagley flags in his post is for a massage clinic. Assuming they are billing for therapeutic and rehabilitative massages (a legitimate billing category), most of the providers who are actually performing the massages are certified massage therapists or atheletic trainers who are loosely suprevised by a single doc. It is quite possible that five, six, or seventy people are billing under a single claim number so seventy hours of compensated care can be provided in a single day. I know when I tweaked my ankle and needed physical therapy, the billing was done by an orthopedic surgeon who I saw once for eight minutes and then I worked with a great therapist for the next eight weeks. Every session I had, I saw at least four therapists on the clock with patients.
An automated outlier detection system is useful. But it won’t be the end all and be all of fraud detection and prevention. Medical billing is too byzantine and convoluted for that.