WSJ exposes flaws of Medicare’s pay now, investigate later culture

Andrew Van Dam

About Andrew Van Dam

Andrew Van Dam of The Wall Street Journal previously worked at the AHCJ offices while earning his master’s degree at the Missouri School of Journalism, and he has blogged for Covering Health ever since.

In the latest story to take advantage of their paper’s Medicare data trove, The Wall Street Journal‘s Mark Schoofs and Maurice Tamman use egregious cases of physicians abusing Medicare’s physical therapy reimbursements to demonstrate the weakness of Medicare’s “pay first, look into fraud later” approach.

They show that, given the data the federal government has access to, detecting fraud should be a speedier, more effective process. CMS has its reasons for slow fraud detection, but Schoofs and Tamman clearly aren’t buying them all.

There are plenty of reasons why Medicare often fails to stop questionable payments up front. To protect law-abiding doctors and hospitals — the vast majority — Medicare is required to pay nearly everybody within 30 days. Medicare says it is reluctant to suspend payments to providers who may have made honest mistakes, out of concern that beneficiaries might go without needed treatment.

The reporters identify what they say is “a central problem” – Medicare isn’t taking advantage of its claims database, a computerized record of every claim submitted and every dollar paid out.

The Wall Street Journal originally identified Dr. Wayne and the other medical providers discussed in this article through a Medicare database that is much more limited than the one available to fraud investigators. The database, obtained in conjunction with the nonprofit Center for Public Integrity, contains records only through 2008, and includes the claims of just 5% of randomly selected Medicare beneficiaries.

Peter Budetti, the head of the new Center for Program Integrity at the Centers for Medicare & Medicaid Services, says the system is working toward fraud prevention and that “he’d like to emulate the credit-card industry, which has developed software to flag suspicious charges before paying them.”

6 thoughts on “WSJ exposes flaws of Medicare’s pay now, investigate later culture

  1. Pam Wood

    As a physical therapist, I have no problem returning to a yearly Medicare on-site visit to monitor our clinic and charting. In order to STOP the majority of fraud in Medicare, we providers may have to be inconvenienced. Maybe then, after getting rid of the fraudulent providers, we will receive more appropriate payment for our services rendered.

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