Monday, February 12, 2024

Medicare Scams? The whole US health care "system" is a scam!

In ‘Staggering Rise in Catheter Bills Suggests Medicare Scam’, Feb 9, 2024, the NY Times suggests that up to 20% of federal spending on medical supplies may be from 7 “high-volume” suppliers of catheters, including people -- like the woman for whom Medicare paid $12,000 for 2000 catheters -- who don’t need them, don’t want them, did not order them, and didn’t receive them. If true, this is a totally illegal scam, something that we see all too frequently in the US, with criminal parasites preying on our people and on a federal agency hamstrung by budget cuts to their enforcement divisions. Perhaps “nursing homes” is what first comes to the minds of many when inflated billing for shoddy care comes to mind, and that is fair, but our medical supply companies and, of course, pharmaceutical companies are right there with scams.

Unfortunately, the biggest scam is not the obviously-illegal like catheter falsifying, but rather the skirting-the-law routine practice of many (maybe not all) health insurance companies in denying necessary, and sometimes legally-required, care to their clients. The most common method for doing so is requiring “prior authorization” and then repeatedly denying it until the client gets weary of fighting it, or recovers, or, maybe, dies from not having a procedure. And it is not like these denials are wisely made by qualified physicians sagely considering the issue; most of them are routinely denied by staff (sometimes, but not always, nurses) following algorithms. Or, increasingly, by AI.

I and others (e.g., have written about Medicare Advantage plans several times, which attract seniors with lower out-of-pocket costs (compared to paying for Medicare Part B + a supplement) and full coverage, including for some services not covered by Medicare (glasses, hearing aids, etc.) My main point has been that this is great if you are willing to use their limited network of doctors and hospitals -- until it isn’t. Until they deny you care. Which can be illegal because they are required by law to cover everything Medicare covers. But, using the “prior authorization” and “repeated denials” techniques, many (maybe not all) often (but not always) do. This is just as illegal as the catheter scam, but penalties have been rarely incurred, and when they are, are low enough to be considered a “cost of doing business”, essentially a slap on the wrist.

But it is not only Medicare Advantage (MA) that uses these techniques (I’ll call them PA&RD) to effectively deny care to the people who are paying their premiums. Indeed, the use of these strategies in MA plans was developed for the insurance companies’ non-Medicare clients, those who have coverage through employer-based plans or ACA. For a long time, the use of PA&RD was common, if not ubiquitous, but possibly legal. Unethical, maybe. Fatal for some, yes. But apparently legal. Some state legislatures stepped in to prevent these abuses, requiring coverage for certain conditions, such as diabetes, emergency care or reconstructive surgery for breast cancer. Indeed, ‘States have passed hundreds of laws to protect people from wrongful insurance denials’, but as documented by ProPublica, ‘Health Insurers Have Been Breaking State Laws for Years’. How do they get away with it? Again, lack of enforcers because of budget cuts and very powerful lobbies for the insurers (they make lots of money and are careful to spend enough of it in the “right” places!) Per ProPublica:

State insurance departments are responsible for enforcing these laws, but many are ill-equipped to do so, researchers, consumer advocates and even some regulators say. These agencies oversee all types of insurance, including plans covering cars, homes and people’s health. Yet they employed less people last year than they did a decade ago. Their first priority is making sure plans remain solvent; protecting consumers from unlawful denials often takes a backseat.

What are the results? One is that people stay sick, get worse, and sometimes die from lack of health care. I hope we can agree that is a bad thing. Another is that people are going broke more and more often from trying to pay the bills that their insurance companies don’t (yes, those insurance companies that they and/or their employers have been paying premiums to). The recent study by KFF Health News and NPR, reported in the Guardian and the Health Justice Monitor and discussed by me recently (ER backups and poor-quality but expensive insurance: The American Way!, Jan 24, 2024), but worth repeating, found that more than 100 million Americans have medical debt. More shockingly, (as reported by Kodiak Solutions, a billing and accounting firm that covers 1800, nearly 1/3 of US hospitals) in just 4 short years the proportion of that debt owed by insured people has risen from 11% to 58%! Think about that – way back in 2018 most “bad debt” was owed by uninsured people (almost all of whom were too low-income to be able to afford it) but by 2022 it was by insured people – meaning insurance companies were not doing what they were contracted to do – paying people’s medical bills – even when required to by state law.

When the bad actions of health insurance companies are combined with the bad actions of health care providers, now often owned by private equity companies seeking only profit (see example of Steward Health Care, or overcrowded ERs in Massachusetts, as well as Arizona) it is obvious that get real pain being is being suffered by – really, inflicted upon -- the American people. On the other hand, insurers like UnitedHealth (which also operates the largest chain of physician practices, Optum), and private equity companies like that which owns Steward Health Care, are doing just fine, thank you, making record profits.  And the drug companies finding all the loopholes in laws to charge more and telling Sen. Sanders and the health committee that sure they charge American consumers more for drugs, but, hey, why the heck not, since we’re allowed to here – and, by the way, don’t change that – are continuing, as they always have, to make out like, well, bandits, which they have always been. They argued to the Senate that Americans get access to new drugs first as part of paying more, but Sen. Sanders appropriately responded that this was of no help to people who were unable to get the drugs because of their cost! Duh!

There are those who think that the money we pay – in premiums, taxes, co-pays, etc. – should be spent on delivering health care, not corporate profits. But so far enough politicians have been willfully deaf and blind on the issue to prevent really significant change to the system so that (as in most countries) it does the latter.

They need to hear from you to tell them that’s what matters.

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