• Crowd sourcing fraud detection

    Medicare and Medicaid have active fraud detection units that are setting records for recoveries. The HHS effort is not entirely in-house, but also partners with insurance companies and other stakeholders to detect fraud. And yet the programs suffer billions in “improper payments:”


    Source: GAO 2012

    We need some fresh ideas. Perhaps we could use crowd sourcing, like the work that Charles Ornstein at ProPublica is doing with Medicare biller data that was recently made public:

    On Friday, I emailed you my story about how a misdirected fanny pack unraveled a Medicare fraud scheme.

    I’m back today with another story that was buried in Medicare’s doctor data dump, about why Illinois leads the nation in group psychotherapy sessions for patients. I found three ob/gyns and a thoracic surgeon who were paid for more than 37,000 psychotherapy sessions in 2012—more than all providers in the state of California COMBINED…

    The billings for group psychotherapy reveal other unusual patterns. A Queens, N.Y., primary care doctor, Mark Burke, was paid for more sessions than anyone else in the country — 20,841. He accounted for nearly one in every six sessions delivered in the entire state of New York in Medicare, separate data show. He did not return messages left at his office.

    Another large biller was Makeba Gordon, a social worker in Detroit. She was reimbursed for nearly 5,000 group therapy sessions for her 26 Medicare patients, an average of 190 each. She also billed for 2,820 individual psychotherapy visits for the same 26 patients, who allegedly would have received an average of 298 therapy sessions apiece in 2012. Gordon could not be reached for comment. [see the Chicago Tribune].

    If we really wanted to jumpstart fraud detection, we’d give a reward for identifying cases like this. Whistleblowers can receive 25 – 33% of the settlement, but crowd sourcing (and investigative reporting like this) won’t qualify because the key data was public, hidden in plain sight.

    UPDATE: The FY 2013 improper payments numbers didn’t report Medicare Part D, but note how the estimates vary over time:

    2013 chartSource: GAO 2014

    UPDATE 2: Good points from twitter & email:

    1.  Not all “improper payments” are fraud. Fraud requires proof of intent; “improper payments” could be innocent mistakes – see the definition in the GAO reports (h/t Paul Van de Water)
    2.  Before we heap condemnation on the gov’t for high rates of “improper payments,” what is the rate for comparable private businesses? (h/t Ezra Abrams)
    3.  HHS has a small rewards program for information leading to recoveries, but it is capped at the lesser of 10% of the recovery or $1000. (Details here.) Remove the cap and publicize the program = crowdsourcing fraud prevention.” (h/t @FrankPasquale)


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  • The effect of Medicaid on educational attainment

    From The Effect of Child Health Insurance Access on Schooling: Evidence from Public Insurance Expansions, by Sarah Cohodes, Samuel Kleiner, Michael Lovenheim, and Daniel Grossman (NBER, 2014):

    The effect of Medicaid expansions on access to healthcare and on subsequent child health has been studied extensively, (e.g., Currie and Gruber, 1996a, 1996b; Moss and Carver, 1998; Baldwin et al., 1998; Cutler and Gruber, 1996, LoSasso and Buchmueller, 2004; Gruber and Simon, 2008), typically showing that Medicaid expansions increase healthcare access, decrease infant mortality, and improve childhood health. Furthermore, these expansions and Medicaid access more generally have been linked to a lower likelihood of bankruptcy and to less medical debt (Gross and Notowidigdo, 2011; Finkelstein et al., 2012). If Medicaid leads to better health outcomes among children and to more stable finances among low-income households, as suggested by prior research, Medicaid expansions could lead to long-run benefits for affected children.

    But the effect of Medicaid expansion for children on their educational attainment has not been studied, until this paper.

    We find consistent evidence that Medicaid exposure when young increases later educational attainment. A 10 percentage point increase in average Medicaid eligibility between the ages of 0-17 decreases the high school dropout rate by 0.5 of a percentage point, increases college enrollment by between 0.7 of a percentage point and 1.0 percentage point, and increases the four-year college attainment rate (i.e., BA receipt) by 0.9-1.0 percentage point. These estimates translate into declines in high school non-completion of about 5%, increases in college attendance of between 1.0% and 1.5% and increases in BA attainment of about 3.3%-3.7% relative to the sample means.

    Go read Adrianna for more on this study.


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  • Massaging Medicaid

    A week-and-a-half ago, the D.C. Circuit upheld the criminal conviction of the owner of a clinic that bilked Medicaid out of millions of dollars:

    [Jacqueline] Wheeler owned and managed the [clinic]. Between January 2006 and April 2008, Wheeler, who was wholly responsible for all of the [clinic’s] medical billing, submitted bills to Medicaid for more than $8 million in treatment allegedly provided. Medicaid paid the [clinic] roughly $3.5 million on those bills, $3.1 million of which was for massage treatments.

    Acting on a tip that the [clinic] was cheating Medicaid, the Inspector General of the U.S. Department of Health and Human Services began an investigation in 2008. The FBI and Medicaid’s Fraud Control Unit soon joined the effort. Investigators easily concluded that many of the [clinic’s] bills to Medicaid were false. For example, several bills claimed that the [clinic] had given more than twenty-four hours of massage therapy to a single patient on a single day. Others reported hundreds of hours of massage therapy for days when only one therapist was on staff. Some sought payment for the treatment of patients hospitalized elsewhere.

    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.

    Wheeler’s claims for never-ending massages should never have been paid. Yet Medicaid, as with Medicare, generally pays first and asks questions later. The government calls this “pay and chase,” and the predictable result is that a lot of pretty obvious fraud slips through. Stephen Parente and his co-authors have estimated that improving the technology for processing claims would save Medicare about $21 billion per year—and that’s without any close scrutiny of medical records. (Austin discussed the Parente study here.)

    Keep that figure in perspective: even $21 billion is a small fraction of the $500 billion per year Medicare program. And there’s no good data on whether Medicare and Medicaid fraud is more prevalent than fraud against private insurers. Even so, why not take more assertive steps to prevent fraud before it happens? The practice of giving cursory scrutiny to Medicare and Medicaid claims threatens to erode confidence in programs that serve urgent public needs.

    We’re doing more chasing nowadays, to be sure. Last year, for example, the federal government recovered $4.3 billion in fraudulent Medicare and Medicaid payments. The Justice Department and HHS crowed that, “for every dollar spent on health care-related fraud and abuse investigations … the government recovered $8.10. This is the highest three-year average return on investment in the 17-year history of the [fraud-prevention program].”

    But what does that rate of return imply? It’s possible that we’re ferreting out more fraud. It’s also possible, however, that Medicare and Medicaid are paying out more dubious claims than ever—and that $4.3 billion is just the tip of the iceberg. When the Armenian mafia decides that Medicare fraud is a growth area, you’ve got a major problem on your hands.

    Criminal convictions and big fraud settlements are important, but they’re not enough. Medicare and Medicaid have to do more to prevent fraud from occurring in the first place—and, indeed, CMS is already taking tentative steps in that direction. No question, there are tradeoffs here. It will be costly to improve computer systems, to monitor compliance with program rules, and to scrutinize claims. Hassled providers will howl. But the Jacqueline Wheelers of the world will continue to submit abusive claims unless Medicare and Medicaid develop the systems to reject them.


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  • Demand for Medicaid is downward sloping

    In a wonky, literature-referencing post on Vox, Adrianna reports on the consequences of even small Medicaid premiums.

    Researchers [in the Journal of Health Economics] looked at enrollment trends in Wisconsin, which introduced monthly premiums for Medicaid beneficiaries living above 150 percent of the federal poverty line. The premiums started at $10 per month and increased with income.

    The study found that the premium requirement itself — not the size of the required monthly payment — is what discourages enrollment. Introducing a $10 premium makes enrollees 12 to 15 percentage points more likely to exit the program. Though premiums got more expensive as enrollee income increased, these changes had little or no effect on enrollment.

    This matters because a handful of states pursuing alternative Medicaid expansions have proposed premiums for enrollees between 100 and 138 percent of the federal poverty line. This Medicaid expansion population is poorer than the enrollees studied in Wisconsin, meaning they could be even more sensitive to required monthly payments.

    So far, four states have requested to impose premiums on some of their Medicaid expansion populations who have incomes above the poverty line and two — Iowa and Michigan — have already received permission to do so. [...]

    Indiana and Pennsylvania are still in negotiations with the Department of Health and Human Services to expand Medicaid. Under its proposed expansion plan, Pennsylvania wants to charge premiums of $13 per month for single adults and $17 per month for families. Under Governor Pence’s “Healthy Indiana” plan, Hoosiers between 100 and 138 percent of the federal poverty line will be required to make monthly contribution of $3 to $25, depending on income.

    Adrianna, with whom I caught up by email, said, “I attest that the paper is worth reading in full.”


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  • Where do high health care administration costs come from?

    Here’s a graph I posted yesterday that shows that the cost of health care administration is much higher in the US than in comparable countries.

    Screenshot 2014-05-19 10.53.22

    So where does this excess administrative cost come from? I have a story from a meeting I was in this morning that will give you a sense of the problem and why it matters.

    I’m at my US job this week and the day’s project is to measure the quality of care delivered by a large pediatric Accountable Care Organization (ACO). We want to know, for example, whether the kids have all their vaccinations. This seems like a simple question. When a kid gets his shot, his doctor submits a claim to the kid’s insurer for the service. So just pull together all the claims, count the kids who have claims for a vaccination, and divide by the number of kids in the system. Then you know what proportion of the kids have been vaccinated. Right?

    Uh, no. To understand why not you need to, of course, follow the money. The money starts with the state Medicaid office. From there, it goes to five managed care organizations (MCOs). Because the MCOs never learned how to actually, like, manage care, they subcontract their business to the ACO. The ACO then works directly with the physicians. You can see a source of waste right away, because money passes through too many middlemen on the way to the doctors. It’s also a pain for the doctors who have to deal with the ACO and multiple MCOs, each asking for information on their own forms.

    Still with me? Recall that the ACO, which is responsible for the quality of care, wanted to use these claims to determine whether the kids have gotten their shots. The next problem is that the claims only come to the ACO from the MCOs after the MCO is finished processing them, which can take months.

    Worse, you have to match claims to kids using patient IDs, and each claim has a patient ID that is specific to that MCO. Unfortunately, kids often switch from one managed care plan to another, at which point the kid gets a new ID. This means that the same kid can appear in the data under multiple identifiers. But to determine whether the kid got all of his shots, you need to look at all his claims, and this means that you have to reconcile the multiple IDs. This takes work, the matching is never completely accurate, and the process slows everything down even more.

    The delay and needless processing add cost to the system and noise to the eventual quality measure. Measuring quality of care is a dry, tedious topic, but it’s incredibly important.

    The problem I’m dealing with is a problem of Medicaid. But it is not a problem unique to Medicaid and some of the overlapping financial entities arose from previous attempts to privatize aspects of the system. The next round of reformers need to strive for simplicity.


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  • What dental care can teach us about coverage expansions

    A simple prediction about the Affordable Care Act’s impact on health care access might go something like this: we have too few primary care providers and expanding coverage is going to cause a spike in demand that those providers can’t meet. Doctors will either refuse to see Medicaid patients or will do so at the expense of the privately insured, who will see longer wait times. Ergo facto, access will suffer. The outlook is bleak.

    Well, maybe. But a new NBER working paper from Tom Buchmueller, Sarah Miller, and Marko Vujicic serves as an important reminder: supply-side effects matter, too. That is, providers can change the way they practice to accommodate new demand, but the studies on provider behavior are much scarcer than demand-side (patient behavior) literature.

    Buchmueller et al examine how changes in Medicaid’s dental benefits—optional for states to provide for adults—influences dental practice. Dentistry might not seem like the most obvious place to search for lessons for the ACA, but it’s actually pretty excellent: dentistry is a form of preventive care and, like traditional primary care, there’s growing worry over a provider shortage. There’s also concern about low participation in the program due to low reimbursements; evidence suggests that access is improves when Medicaid covers dental, but only 39% of dentists in the sample reported serving Medicaid patients. Dentists often work with hygienists, much as a physician can work with nurse practitioners or physician assistants.

    So, what happened when states introduced dental benefits in adult Medicaid? Dentists didn’t just find a way to accommodate new demand—they did so while increasing their incomes by 7% on average.

    We find that when states expand Medicaid dental coverage for adults, there is an increase in the percentage of dentists that participate in the program and an increase in the supply of services to publicly insured patients, with no decrease in the number of visits for other patients. Dentists accomplish this mainly by making greater use of hygienists: following the expansion of public coverage, dentists employ a greater number of hygienists and hygienists provide about 5 additional visits per week. As a result, dentists’ income increases following the adoption of Medicaid adult dental benefits by approximately 7 percent. These effects are largest among dentists who practice in poor areas where Medicaid coverage is most prevalent. We also find that these coverage expansions cause wait times to increase modestly [less than a day, on average]. However, this effect varies significantly across states with different policies towards the provision of dental services by hygienists. The increased wait times are concentrated in states with relatively restrictive scope of practice laws. We find no significant increase in wait times in states that allow hygienists greater autonomy.

    This has pretty self-evident lessons for coverage expansion under the ACA. Just as dental hygienists were able to help meet new demand, researchers have highlighted that reorganizing how we deliver medical care—delegating more tasks to nurses, pharmacists, and other clinicians—could go a long way toward easing the PCP shortage. And like with dental hygienists, defining scope of practice falls squarely to the states, illustrated in the map below from Health Affairs.

    Maximizing access doesn’t rest exclusively on expanding the role of non-physician clinicians; innovations like retail clinics will also play a role. But this paper suggests that scope of practice will play an incredibly meaningful role in access and variation in access—and that there are actions that states can take to ease coverage expansion. You should go ahead and add that to the list of implementation issues that will play out at the state—not national—level.

    The paper is ungated, and well worth reading in full.

    Adrianna (@onceuponA)

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  • AcademyHealth: How severe an access problem do Medicaid enrollees face?

    Today on the AcademyHealth blog, I examine a primary care access study that complements the one I discussed yesterday. You don’t understand access if you don’t understand this study. Go read!



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  • AcademyHealth: How hard is it to find a primary care doctor?

    A new study in JAMA Internal Medicine examines variation in access to primary care by insurance status (Medicaid, private, and uninsured). An Urban Institute study by some of the same authors offers complementary evidence. For a more complete view of “access,” both are worth understanding. I summarize the JAMA IM study in an AcademyHealth post today, and will comment on the Urban Institute one later this week.


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  • AcademyHealth: When it comes to Medicaid, the uninsured are healthier than we think

    Austin and I have covered this topic a number of times, but new research reinforces it. I cover that work in my latest post over at the AcademyHealth blog.

    Go read!


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  • What’s the value of Medicaid? Read Chris Conover

    I recently discussed how the expansion of Medicaid through the ACA may benefit people living with HIV/AIDS. Specifically, getting insurance may encourage previously uninsured people at risk to get tested. Some of them will discover that they are HIV+, enabling them to benefit from early combined antiretroviral treatment (cART). If so, they will not only greatly extend their own lives, but also prevent significant numbers of fresh HIV infections, because cART radically reduces the probability of sexual transmission of HIV.

    This is a plausible argument for one benefit of expanding Medicaid. But plausible arguments are one thing, confirmatory data are another. A critic can and should ask: If expanding Medicaid really saves lives, why don’t we have data supporting a strong mortality benefit for people receiving Medicaid versus being uninsured?

    Chris Conover has a thoughtful post on just this question. He makes two valuable points. First, he questions some previous research that purported to show a large mortality cost of being uninsured. Second, he poses a nifty thought experiment designed to raise questions about whether expanding Medicaid is a cost-effective way to increase life expectancy.

    Conover begins by reviewing some claims for dramatic mortality benefits associated with becoming insured, based on observational studies (such as this one). He demolishes these claims, for reasons that are worth quoting.

    All are so-called observational studies meaning that the two groups being compared (uninsured and privately insured) each self-selected itself into the group. Many uninsured admittedly are in that group because they lack the means to pay for coverage, but the key point here is that unlike a randomized controlled trial, in which people are randomly assigned to be in either the “treatment” group or “control” group, there is no reason to suppose that the characteristics of the two groups will be comparable.

    This argument also demolishes the commonly heard claim that Medicaid is harmful compared to being uninsured. This claim is similarly based on observational studies that are methodologically weak for causal inference purposes, studies that Conover sensibly ignores.

    Unfortunately, Conover does not discuss the most relevant scientific studies on the effects of getting health insurance (like this one). This is the instrumental variables literature, summarized by Austin here. In these studies, researchers look at ‘experiments of nature,’ where large groups of people received or did not receive Medicaid for arbitrary reasons that mimic random assignment. Austin:

    My take-away from the Medicaid-[Instrumental Variable] literature review is: there is no credible evidence that Medicaid results in worse or equivalent health outcomes as being uninsured. […] [It] strongly suggests Medicaid is better for health than no insurance at all.

    This conclusion was reprised in the NEJM by Austin, Aaron, Harold Pollack, and Uwe Reinhardt.

    So what’s my bottom line on the mortality benefit of Medicaid? Getting Medicaid will likely give the average uninsured person at best a small mortality benefit, albeit of uncertain amount. It likely gives the small group of uninsured people with dire health conditions — e.g., people living with HIV/AIDS — a larger benefit. (And, although this is a different question, we could build a better insurance program for the poor than Medicaid, and it would likely have a better effect.)

    Conover, however, then poses a challenge to people who hold views like mine. He notes that there are preventive health interventions targeting smokers that would save lives with greater certainty than expanding Medicaid. So if we are interested in reducing mortality — and if the health benefit of Medicaid is likely small — then is increasing Medicaid the most cost-effective way to improve longevity?

    It would be uncharitable to read Conover as literally proposing to repeal the Medicaid expansion and instead invest billions of dollars in preventive health care. This is, instead, a worthwhile thought experiment. Conover wants people who defend the Medicaid expansion to explain why given the small (possibly negligible in his view, but not mine) and uncertain (his view and mine) mortality benefit.

    I have no trouble defending the expansion, in part because I have no need to do so on mortality benefits alone. Insurance has financial and quality of life benefits over and above its effect on mortality. And even though it may have only a small mortality benefit for the average uninsured person, it will mean life or death for others, and those people matter. For these reasons, people across the world view access to health care for all citizens as a matter of justice.

    Moreover, I do not attribute the small benefit of Medicaid primarily to the deficiencies of that scheme for financing health care. Remember, what insurance does for health is to provide access to health care. My view is that the effect of insurance is much smaller than it should be, given the money that we spend on it, because the effect of accessing health care is much smaller than it should be, given the money that we spend on it. Universal access to health care is a solvable problem: check almost any developed country. Conover’s thought experiment ought to shock us into asking the harder and deeper question: “Why doesn’t our health care system give the poor and rich alike better value for our health care dollars?”

    That question has many answers. Here are a few: We don’t pay enough attention to the social determinants of health. We don’t work hard enough to fix the manifold deficiencies in the quality of health care. We miss opportunities for cost-effective prevention. We don’t follow patients effectively, to support them in adhering to their treatments. And we don’t invest enough in medical research to achieve fundamental advances both in treatments and in how to deliver them.

    Perhaps Conover sees the matter differently. Nevertheless, I urge you to think through the point highlighted by his thought experiment, that extending health insurance has only a small and uncertain effect on mortality. One thing that I hope we can all agree on is that our reaction to the literature on the effect of Medicaid on health should be: We can do better.


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