Waste, Fraud Not Just Confined To Medicare

Medicare billings is not the only focal point for committing healthcare financial waste and fraud, according to a new study by Truven Health Analytics.

The Ann Arbor, Mich.-based Truven analyzed 11.6 million claims generated by 150 large employers over the course of a single calendar year. Altogether, Truven pinpointed $122.6 million in fraudulent claims.

The claims tended to cluster in six specific areas:

• Schedule II drugs such as Vicodin and Oxycodone issued without the supervision of a physician. This accounted for $84.3 million in fraudulent charges.

• Refills on Schedule II drugs without proper physician supervision resulted in $5.2 million fraudulent charges.

• Multiple billings for “new patient” visits within a calendar year, even though American Medical Association guidelines say that such a billing for a specific patient can only be issued once every three years. That resulted in charges of $18.5 million.

• Improper distribution of diabetic supplies – primarily to patients without a specific diagnosis of diabetes. This accounted for $8 million in inappropriate charges.

• Mismanaged drugs and psychotherapy services. They should be bundled in a single payment code, but unbundled payments for both services for a single patient on the same day accounted for $5.3 million of inappropriate charges.

• Medical transportation with no associated medical visit. This accounted for $1.3 million potentially fraudulent charges.

Partly as a result of that study and others in the Medicare realm, Truven concluded that fraud could cost the U.S. healthcare system as much as $175 billion a year.

“The key to avoiding waste is meticulous attention to payment integrity issues; ensuring that the payment is made accurately for the correct service to theproper provider,” said Jean MacQuarrie, Truven's vce president of payment integrity solutions. “Many leading health systems haverecognized the root causes of waste and inefficiency, and have pursued their own successful solutions to improve patient care; this same approach needsto carry over to the commercial health plan market to ensure that payers are not unwittingly supporting fraud.”