The Fraud and Abuse of “Fraud and Abuse”

As a patient advocate and frequent flyer, I spend a lot of time in “waiting areas.” Whether it is the waiting room of a hospital (I really can’t read the same finger-worn issue of Good Housekeeping April 1997 one more time) or the gate at the airport (I really can’t find a seat anywhere near an electrical plug for my laptop), I find myself with a lot of time to people-watch and to do informal surveys of what strangers think about key topics. Lately, my impromptu focus groups have been about healthcare.

A particularly vocal woman from Denver (with particularly vocal children) was on her way to Myrtle Beach, South Carolina via the same flight I was on to Washington Dulles. The abandoned newspapers littered the floor with healthcare headlines, so it wasn’t difficult for me to strike up a conversation: “So what do you think of all this talk of healthcare reform?” After what can only be described as a Rush Limbaughesque soliloquy against the evils of socialized medicine as the slippery slope towards outright American communism (Joe McCarthy would have been right at home in the discussion), she finally took a breath. I worried that I had started something that might never stop, and then she traversed over to another topic.

“They better get all those crooks, that’s all I can say.” (I soon discovered she could say a lot more than.) I asked, “Which crooks? What do you mean?” She looked at me as if I lived on another planet: “Those crook doctors who are scamming Medicare and stealing all our money.” She proceeded to recount to me the terrible news she had seen on TV of some doctor in Florida faking medical visits and bilking millions of dollars out of Medicare from services that were never delivered to seniors…and “we ought to just throw those bastards under the jail, if not worse.”

This endless encounter, which admittedly was probably only five minutes, came back to me two days later when I attended a Congressional hearing by a home care association where former Senator Tom Daschle was speaking. The same story of the evil Florida doctor came up, and in fact, much of the hearing was addressing the perception of rampant “fraud and abuse” in the home care industry. Apparently a few companies south of Miami (what’s up with Florida, by the way?) had applied to be Medicare service providers of home oxygen tanks and other medical supplies, but it was discovered to be a sham business. But as with my erstwhile airport friend from Denver, many in Congress had seized upon this one example of “fraud and abuse” to cast the entire home care industry as crooks and evil-doers whose actions must be stopped.

As I think back over the past month, I now realize that “fraud and abuse” may well have become the rallying cry to try to stop reform and thwart innovation. In fact, I am beginning to think that “fraud and abuse” is to our current reform effort what “privacy” and “Big Brother” were to the Clinton era attempts to fix healthcare: namely, buzz words that push emotional buttons and distract us from debating the real issues. I have heard many members of Congress jumping on the “fraud and abuse” bandwagon to justify cutting Medicare reimbursement for home care. The majority of well-meaning and perfectly legitimate home care providers—many of whom are faith-based nonprofits who have been delivering quality care to the home for 50 years or more—are under siege because of a few of “those crooks in Florida.” 

Hitting closer to home (pardon the pun) of my own issues of personal health reform, I have heard rumblings from the Congressional Budget Office and some members of Congress that telehealth and virtual visits to the home are not a good idea because of the potential for “fraud and abuse.” One indignant fellow said to me: “You’ll shut down the whole healthcare system if a doctor can just pretend to have called a patient on the phone and then bill Medicare for it.” (Which is not what we are proposing, I should mention.)

Perhaps most troubling are the news stories with pundits fretting about how we must “weed out fraudulent doctors who are abusing the system” as a key cost-saving measure for healthcare reform. I’m not sure when our society went from revering and respecting the family doctor to fearing and loathing them as “crooks,” but this impassioned rhetoric has some dangerous implications. While I haven’t yet found the actual numbers on how many doctors are truly doing fraudulent claims for their own criminal gain, I have to believe that the percentage is very, very small. (If anyone has data on this, I’d love for you to post it here.)

Yes, many physicians—I’m betting more than half of those we have studied in our Intel fieldwork—end up coding a visit with a patient in ways that may not be technically accurate. But they’re not trying to steal money or perpetuate a fraud on Medicare or the health plan. They are simply trying to figure out how to work the system to give a patient a particular test they need, or to help a patient afford medications, or to traverse the complex bureaucracy of rules, codes, and protocols that often make it difficult to give the best treatment to the patient. If we are going to put every physician in jail for creatively coping with bureaucracy, then we’re not going to have very many doctors left to care for our aging nation.

These hyped up calls of “fraud and abuse” divert our energies and emotions from the real challenges of reform. I am all for regulation and enforcement of laws that put the rare crook in jail for true fraud and abuse of the healthcare system, but we can’t let glaring headlines, fear, and righteous indignation about the exceptions trump our common sense about the norms. The vast majority of home care providers, telehealth care workers, and physicians are not “crooks” or “scam artists”—they are well intentioned professionals who are doing the right things for their patients for the right reasons. We can’t allow the abuse of “fraud and abuse” to stir up our fear and loathing, only to perpetuate a fraud upon our own actions and emotions. We risk chasing the wrong problems, policies, and people if we let our fears rule the day.

6 Responses to The Fraud and Abuse of “Fraud and Abuse”

  1. Russ Bodoff says:

    Excellent posting. This was so true to what is happening today and what we hear on Capital Hill, that I circulated your comments to our Board Government Affairs Committee.
    Keep the great insight coming.

  2. Bill MacKenzie says:

    While I am generally in agreement with critics who say that we are not going to make a meaningful dent in federal spending by eliminating “waste, fraud and abuse”, Medicare does seem to be one place where this is a particularly egregious problem, one that would be exacerbated by a single-payer federal health insurance program or even an expanded federal role in health care. Medicare fraud is generally considered to involve billions of dollars. In this new environment of multi-billion bailouts for everything under the sun, a few billion (such as to enable people to buy new cars) is no longer considered much money, but in my view the extent of the fraud in Medicare can not be so easily dismissed as inconsequential.
    I agree with Eric that “fraud and abuse”allegations should not divert our energies and emotions from the real challenges of reform, but the problem should not be ignored,either, in the rush to redesign our healthcare system.

  3. jeff mero says:

    Hi, Eric-
    Just got invited to join, and very much enjoyed your “Fraud and Abuse” effort. I agree that we are in the “Death by a Thousand Sound Bites” phase of the discussion–many, many elected people looking for ways to say no to any responsive change. We should root out fraud and abuse wherever we find it, including Medicare. Although this is not our topic, I must note that this fraud and abuse issue seems to have slipped right off the radar again in our financial institutions and those tasked with regulating them.
    But…back to the point….
    I believe that if Congress could took all the most “socialistic” approaches left in all the reform bills still getting serious consideration in DC and put them together in one bill and passed it–and they won’t–we’d still have a system that “medicalizes” problems to “treat” them rather than socializing them in an effort to solve them. Self-care, health promotion and prevention are blips on the screen…and there is little mention I can find, anywhere, of addressing the needs of the millions of Americans who live with or care for someone living with chronic illness, spending thousands out of pocket every year because their “problem” is not “medically acute” enough.
    I would very much like to find ways to support and advance “health reform” (rather than insurance reform or medical system reform, both of which, it seems to me are a bit like painting a house that no one would really choose to buy if there were another one available….how can we begin?

  4. Kofi Cobbinah says:

    While fraud and abuse are huge factors in today’s medicare, it also presents great opportunities that the current healthcare system lack. The feedback system from the patient to the doctor on ratings and pay. My analogy may be oversimplified but in business customers are the main enablers for good products, but in medical care patients are not main enablers for better care? So is there away to use technology for patients to have better feedback system to their doctors on recovery, good health, good lifestyles to set as points to curtail fraud system!!! That will make it extremely hard for Fraud and might reduce it’s current levels in medicare. My two cents.

  5. Good points. Home medical equipment and services is in fact the slowest-growing (0.75 percent per year, 2007 NHE data) sector of Medicare in spite of growing demand. The home medical sector has urged Congress to devise better ways of preventing fraud. See But by any yardstick, homecare is not the problem with Medicare. You’re right, some are using fraud as an argument against any type of healthcare program administered by government. Some smart increases in spending on fraud-prevention would save money lost to waste and fraud and help pay for reforms and improvements to healthcare.

  6. Sandra Elliott says:

    While there are opportunities to save money by addressing Fraud and Abuse, it truly is low hanging fruit and probably drives little of the overall growth in healthcare costs. The reality is that creatively addressing the problem through developing new care delivery models and supportive business structures is a lot harder than just crying “foul”. In all honesty I feel like a lot of the technology that could be employed could actually fight fraud and abuse through more accurate audit trails of what care is acutally transpiring…so I agree – lets focus on the real issues minimize the distractions as much as possible. Thanks Eric – great post!