News and Analysis (January/February 1999)

Lawrence R. Huntoon, MD, PhD
Article Type: 
News and Analysis
January/February 1999
Volume Number: 
Issue Number: 

More Government Tracking and Guidelines

The State of New York recently wrote letters to practicing physicians within the state notifying them the state's peer review organization (Island Peer Review Organization --- IPRO) was tracking their management of atrial fibrillation in Medicare patients. A copy of the state's recommendations for treatment was enclosed with the letter. Their letter also contained the declaration that they are the "Experts in Defining and Improving the Quality of Healthcare," just so there would be no misunderstanding about who was in charge.

In the past, when physicians deviated from the state's guidelines, the state took punitive action by assigning the physician quality deficiency points. Some of the so-called "quality issues" cited were astonishing.

In 1990, the New York State IPRO "experts" assigned me 5 points at a "Level II Quality Issue" for failing to work up a slightly elevated hematocrit/hemoglobin in a chronic heavy smoker (an expected finding).

In that same year, IPRO also cited an internist at our hospital because he allegedly discharged a patient "too soon." The patient had metastatic cancer and was dying, and the patient and family specifically requested the patient be allowed to die at home. IPRO apparently thought the physician should have forced the patient to stay in the hospital against the patient's wishes. Two weeks later when circumstances changed and the family could no longer care for the patient who was deteriorating, the patient had to be readmitted to the which point IPRO cited the physician again for an "inappropriate admission" saying the patient could have been treated at home.

As a result of widespread physician protests about the punitive nature of these "quality reviews" by these self-proclaimed "experts," the quality point deficiency system was eliminated in favor of a more "educational approach." The state's new educational approach, however, is beginning to look more and more like rigid guidelines, and punitive actions for not following the state's recommendations are likely not far behind.


AMA Accreditation: AMAP

The AMA's American Medical Accreditation Program (AMAP) appears to be gaining steam. Massachusetts, Utah, and Hawaii have now signed agreements with AMAP bringing the total number of states that have signed or announced intentions to sign to 18. The stated purpose of AMAP is to "help streamline the accreditation process for physicians" (AMNews, August 3, 1998).

In an interview with an AMAP representative, it was learned that a number of hospitals have signed agreements with AMAP also. If this trend continues to spread, we may see a return of the days when physicians had to be a member of the AMA and local medical societies in order to obtain hospital privileges. Just think what an exclusive contract with the government could do for the AMA's declining membership problem!


Obesity Guidelines

Speaking of guidelines, the Big Bloated federal government released the first federal clinical guidelines last year which redefine obesity in adults (JAMA, July 22/29, 1998). The Fat Federal bureaucrats have now decided that 55 percent of the population is too fat. Perhaps it's their way of telling us the Fed plans to move in the direction of rationing both food and healthcare.


New York State Public Health Law 2165

In the interest of promoting more government tracking and regulation, students in New York State who plan to attend college, are under the age of 41, and plan to take more than six credit hours must present their immunization record to the college or they will not be allowed to enroll. This is according to New York State Public Health Law 2165. Higher education is thus being rationed according to compliance with government immunization mandates.

Of course, if you do send your blood to a lab for testing, you will have your choice of a variety of AMA-approved blood panels (since all other multichannel chemistry panels have essentially been eliminated). Streamlined lack of choice is another benefit of public-private partnership.


Dr. Jekyll Had Better Hide --- The Seniors Are Coming

If it looks like a doctor, walks like a doctor, and talks like a doctor, it's merely a criminal in disguise...or so says the federal government. In the ultimate government effort to undermine trust between patients and their physicians, senior citizens are being recruited as healthcare fraud investigators and other seniors are being offered a bounty of $1,000 for "worthy tips" (AMNews, July 20, 1998). And, it's all being done under the auspices of Operation Restore Trust, referred to by some physicians as Operation Destroy Trust.

Since there are too many honest, hard working physicians out there to put all of their pictures in the post office, the government has been posting generic "wanted poster" type messages on billboards across the nation. The HHS fraud hotline has reportedly received 97,429 calls since it was started in 1995. The vast majority of those calls, however, were reportedly related to billing complexities of the Medicare system itself and less than a third of the calls warranted any follow-up at all.

The government is now training senior citizens as undercover agents in 12 states as part of a community volunteer demonstration project --- another public-private partnership. The states include California, Hawaii, Illinois, lowa, Maryland, Minnesota, Missouri;

New Hampshire, New York, Pennsylvania, Rhode Island and Wisconsin.

As government increases its abuse of physicians, we are beginning to see an increasing number of reports of physicians dropping out of the Medicare program (AMNews, May 25, July 20, and July 27, 1998).

The AAPS, of course, has a longstanding tradition of recommending that physicians not participate in the Medicare program as the "only legal, moral, and ethical means of concretely expressing their complete disapproval of the spirit and philosophy behind these amendments" (Social Security Amendments of 1965 which created Medicare; the Principles of the Association of American Physicians and Surgeons).


Large HMOs Welcome More Government Regulation

Why? According to an article in The Wall Street Journal, it's because increased government regulation would kill off the smaller competitors in the market, leaving more for the big guys (Robert M. Goldberg, "Why HMOs Now Love Regulation," July 17, 1998).

The article tells us what most physicians already know --- "managed care is dying." Patients hate HMOs; doctors hate HMOs; and after nearly a decade of low-balling premiums to increase market share, the HMOs are now losing money hand over fist. So, the large HMOs are now looking for government intervention so as to concentrate their market power.

Increased government regulation has always resulted in increased costs and increased costs are predicted to "crush the HMO's competition --- entrepreneurial ventures that are responding to consumer demand for quality care." This government intervention designed to decrease competition and concentrate power in the hands of a few large HMOs will, of course, be done under the clever disguise of "Patient Protection Acts." All of which proves, we have the best legislators money can buy.


How Much For A Life?

Well, that depends on what society and government think you are worth, and what they might want to allocate to keep you alive: Cheaper by the dozen and becoming cheaper by the minute.

An editorial by Cal Thomas tells us that a bioethics professor at Princeton's University Center for Human Values "favors killing disabled babies because he thinks they have no right to live" (The Post-Journal, July 27, 1998). The professor "sees the future as one in which babies and infants are declared nonpersons because they are not rational and self aware. According to him, even a baby with a condition as mild as hemophilia can be killed if such a death has 'no adverse effects on others.' He apparently believes "all such nonpersons are 'replaceable,' much like chickens and other farm yard animals, an analogy which he uses. He believes in ending anyone's life when it is 'not worthy of living,' and in the involuntary killing of anyone who has become a 'burden' to their families, the health care system or the state."

Believe it or not, there are actually those who have been calculating the potential cost savings from such things as legalizing physician assisted suicide in our country (E.J. Emanuel M.D., PhD, et al., "What are the potential cost savings from legalizing physician assisted suicide?" The New England Journal of Medicine, Vol. 339, No. 3, July 16, 1998).

It is estimated that legalization of physician assisted suicide could save between $627 million and $1.63 billion per year depending upon how many people (2.7% to 7.0%) would choose this option. The authors conclude, however, that legalizing physician assisted suicide is "not likely to save substantial amounts of money in absolute or relative terms, either for particular institutions or the nation as a whole," because it only represents .07 percent of total health expenditures. The authors, however, also note that "although the overall national savings from legalizing physician assisted suicide might be small, for many families --- especially those of uninsured patients --- the savings could be substantial."


Medical Privacy About To Be Lost...Forever

Under Kassebaum-Kennedy (HIPAA, 1996), all American citizens are scheduled to be assigned a Health ID number so that government can track our medical care from cradle to grave. But, as we all come closer to losing our identities and being assigned a government number, some of us are expressing concerns about privacy (Medical Sentinel, Nov/Dec 1998). Even the chairman of the National Committee on Vital and Health Statistics Subcommittee on Privacy and Confidentiality, Robert Gellman, J.D., is expressing concerns.

In a meeting at HHS headquarters in February 1997, chairman Gellman indicated he didn't feel there is any evidence that disclosure of medical information has hurt the quality of care. He also questioned whether it would be practical or not to get authorized consent from patients in order to obtain their medical information and link it on computer networks.

But listen to what Mr. Gellman has to say today. "Once everyone is required to use a government-issued health identification card, it may become impossible for any American citizen to walk down the street without being forced to produce that card on demand by a policeman. You won't be able to use a credit card, cash a check, fly an airplane, check into a hotel, go to school or enter of leave the United States without showing that card. You may not be able to use Viagra or even buy an aspirin without the federal government being notified"("Health ID Numbers Spur Privacy Worries," The Post-Journal, July 21, 1998).

So why did congress pass a law that will destroy medical privacy? Well, according to a study released by the Center for Public Integrity, it's because "lawmakers accept campaign money from corporations that want access to people's personal information" (The Post-Journal, July 28, 1998). Banks, HMOs, insurance companies, health care companies, credit card companies and companies that produce healthcare products all want access to your personal information and they've paid big bucks to your legislators to increase the chances they will get it.

In the 1995-1996 campaign cycle, financial institutions contributed $32 million, and hospitals, HMOs and pharmaceutical companies contributed $13 million to various congressional candidates. Some firms that already sell personal information also contributed to congressional candidates. "The founder of CDR Infotek of Santa Ana, Calif., Rick Rozar, gave $100,000 to the Republican National Committee in October, the center found. The company, where Rozar no longer works, will provide a person's full name, birth date and Social Security, telephone and driver's license numbers for $7." Just imagine what $10 will buy once all of this private medical information is on computer networks.

Of course, some states already profit handsomely from the sale of personal information. New York State, for example, made more than $48 million dollars in 1994 "by selling public information, most of it data residents are required to divulge" (The Post-Journal, August 13, 1995).


Anxiety Over Falling Income?

Having some anxiety over plummeting income? The AMA says not to worry. You're doing just fine. At least that's what they've told the public.

According to a 1997 AMA survey, average physician net income in 1996 was $166,000 (AMNews, July 13, 1998). And, for all of you filthy rich, freedom-loving, self-employed physicians, the average income was $198,000. And this is for working on average only 56 hours per week.

Some of the AMA House delegates, however, have questioned the accuracy of this survey which surveyed only 4000 physicians in the country and which excluded government employees and physicians in training. The news media, of course, has been quick to

publish these results so that politicians and the public can feel good about cutting physician incomes even further.

One wonders if the AMA's physician income survey included the rather substantial incomes paid to AMA officers? (See "AMA's Reimbursement Figures," Medical Sentinel, Vol. 3, No. 2, March/April 1998).


BLUEprint For Fraud

Ever wonder what Medicare carriers really do with your Medicare claims? Toss them in the wastebasket, feed them to the shredder, delete electronic claims en masse, shut down the phone system during peak hours so electronic claim submitters can't submit their claims and manipulate files and file false reports to cover up their misdeeds? All true!

In the largest settlement for Medicare fraud, "Health Care Services Corp. --- also know as Blue Cross/Blue Shield of Illinois - will pay $144 million to settle fraud charges." (AMNews, Aug. 3, 1998). Nothing new there --- AAPS members have been reading about the shenanigans of the "Blue Bunglars" for years. In this case, however, the Medicare carrier actually pleaded guilty to 8 felonies.

Investigation revealed that Medicare carrier executives got $1.3 million in "bonuses and incentives" for improperly processing and destroying Medicare claims. And that's not all. "Executives shut down telephone system at times of high volume, deleted files with incorrect information instead of correcting them, manipulated files and documents to meet federal regulations, and submitted false reports to cover up mispayments and other poor performance."

We note that HCFA essentially allows all Medicare carriers to evaluate their own performance in their Annual Carrier Evaluation Report (ACER). All of this, of course, would have never come to light had it not been for a Medicare clerk refusing to carry out her boss' request to shred 10,000 unprocessed Medicare claims. Another Blue Cross/Blue Shield company was also fined $16.4 million for short-changing their clients by cleverly calculating co-payments "on the full price of services, not the discounted fees the insurer had negotiated with hospitals" (AMNews, July 20, 1998).

And, don't forget that it is Medicare carriers who employ Medicare investigators to investigate the alleged crimes of others (Medical Sentinel, Vol. 3, No. 4, July/August 1998). Are these the kind of people we should trust to evaluate themselves?


RWJF --- Changing the "Culture of Death"

As the AMA gets ready to roll out its Education for Physicians On End of Life Care (EPEC) program, "trainers" are looking forward to collaborating with the RWJF-funded program to change the culture of death in America. An article which appeared in the July 13 AMNews, quotes Dr. Janet Abrahm as saying: "If I could change the culture of death in the University of Pennsylvania Health System, that would be terrific" (AMNews, July 13, 1998). We are told that Dr. Abrahm teaches at the University of Pennsylvania Medical School and also is a "faculty scholar with the Project on Death in America."

Ms. Susan Buchanan, who is an attorney at the Colorado Collective for Medical Decisions, a futilitarian think tank, says she was "excited" about the EPEC program. The word "collective," of course, is key here, because it's not just part of their name, it's an integral part of their philosophy. According to the article, one of the benefits of an EPEC education would be to lower costs by teaching physicians how to "recognize futile care earlier" (via futility of care guidelines?).

The Robert Wood Johnson Foundation, of course, has already implemented a "Pathways" program in the Kansas City area through its Midwest Bioethics Center to meet the needs of dying patients.

In the end, it all seems to come down to the "village" people. Apparently, if it takes a village to raise a child, it also takes a village to decide when its time for an individual to die.


Dropping Out of Medicare For the Millennium

Struggling with the desire to have nothing more to do with the government's abusive and intrusive Medicare system yet wondering if you can make it without participating in the Medicare program? Well, if the only thing keeping you in the Medicare program now is the steady revenue stream, be forewarned that the money may stop flowing rather abruptly on January 1, 2000.

The Y2K computer crisis is coming, and according to the U.S. General Accounting Office, it's not going to be pretty. In a report delivered to the House of Representatives, "Year 2000 Computing Crisis: Continuing Risks of Disruption of Social Security, Medicare and Treasury Programs," we learn that HCFA really isn't ready for the millennium. In fact, one Representative, Stephen Horn "gave HHS an 'F' on its progress toward solving the Y2K computer problem" (AMNews, July 13, 1998).

According to a senior official at the GAO, that means that "no claims would be processed." So, how bad can it be? Well, according to the GAO "If Medicare systems failed, the number of health service providers who would not be paid, paid late or paid incorrect amounts is unknown. HCFA has not documented the severity of the impact of year 2000 related failures."

Apparently, HCFA has been too busy thinking up new ways to stick physicians with user's fees, paper claim penalties, hiring bounty hunters and planning armed raids on physician offices to be bothered with such "minor" details like physician pay.

Although HCFA claims they can't force their contractors to remedy the situation, HCFA says it needs another $100 million to address the Y2K problem. Given that total government expenditures on the Y2K problem have already exceeded $5 billion, and HCFA is now asking for millions more, we think we have a good handle on where most of the healthcare fraud is in the system.

Just remember, if you sign the Medicare Participating Agreement in December of 1999, you agree to accept whatever Medicare allows as payment in full for an entire year, even if it's ZERO.


Physicians Ready To Go To War Over HCFA's Proposed "User Fees"

Even the AMA is starting to use phrases like "abuse" of physicians in describing President Clinton's proposed User Fees that physicians may have to pay for the "privilege" of interacting with the Medicare bureaucracy. The AMA House of Delegates has directed the AMA "to fight any attempt by the federal or state governments to impose user fees, provider taxes, access or bed taxes on doctors or other providers" (AMNews, June 29, 1998).

HCFA has become so big and its mission to meddle in medicine so enormous that it can no longer afford the level of abuse it intends to inflict on physicians. Given HCFA's tradition of extorting money from physicians and slashing fees to the bare bones, it quite naturally is looking to physicians for even more money to fund its expanded campaign of abuse.

Some physicians also seem to be taking another hard look at Section 1801 of the law which created Medicare as evidenced by Louisiana delegate Dr. Michael Ellis' comment that "HCFA stands for Health Care Financing Administra-tion, but it appears as if it has gotten well out of the bounds of simply financing health care." No kidding! There's even a hint that the AMA may be developing enough spine to actually stand up and do something about this HCFA bureaucracy run amok: "The house directed the AMA to request a congressional investigation of HCFA practices and "administrative excesses," with particular attention to its "abuse" of patients, physicians and other health professionals." Nevada delegate Dr. Robert Shreck says "It's about time that the regulators get regulated."


AMA House of Delegates Acts To Squelch AMA Gag Rule Policy On Free Speech

Believe it or not the AMA Council on Ethical and Judicial Affairs (CEJA) produced a report which "would have restricted political conversation between physicians and patients" (AMNews, June 29, 1998). Hey, why worry about HMO gag clauses? If we wait long enough maybe those who write the rules of ethics in the AMA will do the job for the government and HMOs by declaring it unethical to tell patients the truth about what is happening to their health care. This is the "we had better gag ourselves or they will do it for us" theme again. Same old song; different verse.


Even the AMA Is Starting To Be Concerned About the Medical Police

Outgoing AMA President Dr. Percy Wootton says he has gotten the message from talking to physicians around the country: "In virtually every one of my stops, physicians expressed their dismay about how the government is flexing its authority, inappropriately and irresponsibly, to search out fraud and abuse in the health care system. Recent legislation has created an army of fraud and abuse enforcers." (AMNews, June 29, 1998). Gee, this is beginning to sound a little like the Declaration of Independence, "He has erected a Multitude of new Offices, and sent hither Swarms of Officers to harass our People, and eat out their Substance..."

A couple of months earlier the AMA was assuring us not to worry because their "bed partner" HCFA has assured all of us that "Physicians will not be punished for honest mistakes." Of course, in HCFA's view, there are no honest mistakes or if there are, they are made only by HCFA and Medicare bureaucrats, not by physicians. AMA is now asking HCFA for more reassurance: "We have asked HCFA to respond to the very real worry that a simple coding mistake will result in a criminal investigation and a $10,000 fine for every improper claim.


AMA Federal Fraud Enforcement Physician Compliance Brochure

In the Federal Fraud Enforcement brochure developed by the AMA's Office of the General Counsel, the AMA has been reassuring physicians HCFA had intimated that coding errors and other mistakes were not going to be treated as fraud. However, an AMA brochure provides an interpretation that is somewhat different than what the AMA leadership has told physicians.

On page 1 it states: "The government has the authority to impose sanctions where an investigation finds fault with a claim, ranging from a possibly inadvertent mistake to a determination that the claim was fraudulently submitted." [Emphasis added.]

So, in the opinion of the AMA General Counsel a mere "fault" with a claim or "inadvertent mistake" can make you eligible for government sanctions. They reinforce this message again on page 2 and emphasize that you can be eligible for both criminal and civil sanctions: "Where an investigation finds fault with a claim, ranging from a possibly inadvertent mistake to a determination that the claim was fraudulently submitted, the government has the authority to impose both criminal and civil sanctions (monetary fines) against the individual or entity claiming a right to payment." [Emphasis added.]

And, for those who thought that there had to be some sort of pattern of claim irregularities to make one eligible for government prosecution, the AMA General Counsel says that if the bureaucrats decide that even a single claim was fraudulent in their opinion, the physician can be sent up the river. On page 3 one reads: "If there is a determination that even a single claim was submitted fraudulently, sanctions may include: imprisonment for up to five years; a fine of up to $250,000 per claim; and a five year exclusion (lifetime exclusion for a third conviction) from participation in the Medicare and Medicaid programs."

They go on to outline the elements of a "Compliance Plan." These elements basically consist of swearing a loyalty oath to HCFA, creation of a new office position of "Compliance Officer." (choice of black or brown shirts with armbands) and periodic internal audits (at least quarterly).

And, since the government has shown an affinity for fraud hotlines, they suggest that the "compliance officer should operate or maintain a hotline process to facilitate reporting of suspected violations" (page 6). And, "organizations should maintain a written enforcement and discipline policy" (40 whacks with a cane on the behind for each offense?).

It's hard to believe that a medical organization is encouraging its physician members to run their offices this way. Instead of mounting a vigorous counter-assault against this tyranny, they seem to be acting more like quislings.

And, apparently the AMA General Counsel feels that physicians should relinquish their Fifth Amendment rights so that they can be viewed by the government as assuming the proper submissive posture. The AMA General Counsel recommends turning yourself into the government authorities if you discover any compliance problems, inadvertent or otherwise, although they say self-incrimination is no guarantee of leniency.


Indemnity Insurance Cheaper Than HMO Coverage?

Although it's always difficult to compare premiums for different types of medical coverage, information supplied to me by the New York State Insurance Department would seem to indicate HMO premiums are now higher than traditional indemnity insurance premiums. Comparing the premiums for a family plan, we find that the average monthly HMO premium in our county is $512, and for HMOs with point of service option, it's $580 a month. Co-pays are $500 for inpatient stay, $300 for prescription drugs, and $50 for visits to the emergency room with no deductible and maximum out-of-pocket costs of $3,000 per year.

You can get a $2,000 deductible family indemnity policy, however, for $760 per quarter ($253 per month). That's an annual savings of $3,113 over HMO coverage and a savings of $3,928 compared with HMO coverage with point of service option. Either way, with the traditional indemnity policy, you would save enough each year to more than cover the $2,000 deductible. The rest would be money in your pocket instead of money in the insurance company's pocket.


Home Health Care Authorizations

In an admission that signing those government certification forms for home health care services places the physician at grave risk, the AMA cites Section 1128A of the Social Security Act and says: "Physicians who certify the need for home health services and who know that all of the requirements for this care are not met, are subject to civil monetary penalties." The Health Insurance Portability and Accounta-bility Act of 1996, Public Law 104-191 (HIPAA), clarified that the term "should know" includes, with respect to information set out in a claim, "acts in deliberate ignorance" or in "reckless disregard of the truth or falsity" and "no proof of specific intent to defraud is required."

Most physicians simply rely on whatever the nurses or administrators fill out on those forms, and just sign them where the arrow points at the bottom of the page. And for those who think it would just be a "nice thing to do" for the patient, you should know that Medicare strictly forbids home health care services to be given "primarily for the comfort or convenience of the patient." The government also forbids home health care services if they are merely for "maintenance" purposes or if the patient of family is non-compliant with the plan of care or if "goals cannot be achieved" or services "will not result in improvement of the patient's condition."

Signing one of those government certification forms in the current environment is like running through a minefield blindfolded.


Not Quite What Dr. Matthews Said

At the AAPS Board meeting in Dallas, Dr. Merrill Matthews, VP-Domestic Policy at the National Center for Policy Analysis (NCPA), gave an excellent presentation on a new type of MSA, Patient Protection Accounts (PPAs). Recently an article entitled, "Managed Care is Nice But We Need More Choice," appeared in The Post Journal (June 26, 1998). The article reviewed tax discrimination and the benefits of PPAs. Also noted were the benefits with respect to increasing freedom in health care, something which is increasingly in short supply. But, they unfortunately link the PPAs with managed care when they say "The beauty of this idea is that it allows managed care to do what it does best without sacrificing patients' rights."

I don't think either Dr. Matthews nor the NCPA ever said "managed care was nice," nor did they necessarily advocate using these accounts exclusively with managed care coverage. In fact, their analysis says "These proposals --- if implemented --- would change the way the private marketplace responds to the perceived deterioration of health care quality that has emerged with managed care."

The deterioration in quality of health care, of course, is not just perceived but is real and clearly has been caused by managed care. And, the only thing managed care is "best at," is short-changing patients who have the misfortune of getting sick.

This edition of News and Analysis was written by AAPS Board of Directors member, Lawrence R. Huntoon, MD, PhD. It appeared in the Medical Sentinel 1999;4(1):11-16. Copyright©1999 Association of American Physicians and Surgeons (AAPS).


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