News and Analysis (November/December 1998)

AMA Membership Opposes "Leadership" on E&M Guidelines

AMA leadership is still pushing hard to get some form of the AMA/HCFA E&M guidelines implemented. But the AMA House of Delegates recently voted to oppose any documentation system that "requires quantitative formulas or assigns numeric values to elements in the medical record to qualify as clinically appropriate medical record keeping" ("House rejects checklist approach for E&M guidelines," AMNews, June 29, 1998).

California delegate Melvyn Sterling, M.D. says, "The complexity of human physiology and disease mandates a rejection of a cook-book scheme to evaluate care. Acceptance of any system of numerical grading is an invitation to return to the HCFA proposal which has been so vigorously rejected by our members."

AMA President Dr. Nancy Dickey comes up with the same lame warning that if we don't shoot ourselves, HCFA will do it for us. She says, "We have concerns that if we don't have some criteria the criteria may simply disappear into the black box. (Criteria would) still exist, but we wouldn't know what they were. One of our primary competitors who'd like to be at that table is Minnesota Mining and Manufacturing. I'm not sure that's who I'd want writing the guidelines."

There was such an uproar from angry member physicians across the country that the AMA House really couldn't do anything other than oppose the AMA leadership on these AMA/HCFA guidelines.

Here's the bottom line as stated by Dr. Barry Tepperman, alternate delegate from Florida: "The ship may need to come to a stop and take a different direction...It is headed to the shoals of lost membership and unhappy physicians."

A couple of points included in the AMA House resolution also indicate that physicians are getting pretty fed up with HCFA's expanded pre-payment E&M audits and HCFA's practice of requiring payback of funds before a physician has exhausted the appeals process.

HCFA, of course, is continuing its highly successful extortion campaign against medical schools via its PATH program. The latest victim is the University of Texas Health Science Center, San Antonio, which agreed to pay HCFA $9.8 million plus $7.4 million in interest and other penalties ("UT-San Antonio latest to settle PATH charges," AMNews, June 29, 1998).

Government Looking for Fraud in All the Wrong Places

With the passage of the Kassebaum-Kennedy law and the tens of millions of dollars flooding into physician-targeted fraud programs, could it be that the government is barking up the wrong tree? Why, if we would just fund more of those school-based health programs and have more government-controlled medicine, there wouldn't be any fraud...right? Well, not exactly. As it turns out, some of those "wonderful" school-based healthcare programs are the prime source of fraud, though no one in the government seems eager to call it that.

The main focus of the article which fittingly appeared in The Post-Journal on May Day ("Comptroller Criticizes Health Programs") was that more centralized control and standardization of school health care was needed, taking such

matters out of the hands of local school districts. The State Comptroller found there was a considerable amount of that nasty "double dipping" going on...not by physicians, but by the centralized controllers. The article mentions in passing, "In a separate audit released Thursday, the comptroller's office found that the New York City Health Department and the Board of Education each submitted claims to the state for the same school health services costs during the audit period from 1990 to 1995.

As a result of the duplicate claims, the Board of Education was overpaid $9.16 million in school aid according to McCall's office."

The article doesn't say, of course, whether or not the Board of Education had to pay any of that money back, nor does it mention if anyone was subjected to any sort of fine or other punishment for this $9.16 million worth of pure fraud.

Of course, all fraud aside, if they wanted to put taxpayer's money to really "good" use, they should have given it to the National Park Service. Did you know that the National Park Service recently spent $784,000.00 on a two-hole outhouse? It's true! Because of the extraordinary "complexity" of constructing such a thing consisting of a piece of plywood with two holes in it with a roof overhead, it was necessary for the government to hire architects, designers and "oversight management," in addition to the workers who actually constructed the outhouse and the budget included a 16 percent "contingency charge" in case they had a cost overrun. No, I am not making this up ("Fancy Outhouse Is Gross Abuse of Taxpayer Money," The Post-Journal, April 26, 1998).

The final result was environmentally safe, politically correct, and will no doubt save the taxpayers a lot of money on the water bill since there is no plumbing or running water. Of course, once the pits become full, they will have to hire more advisors and supervisors to decide what to do with the stuff. Perhaps they will decide to gold plate the outhouse and turn it into a "lord of the flies" museum.

Crimes Pays -- If You're an HMO

When is a fine not a fine? Answer: when the government gives the money back! Unlikely, you say? Well, not if you're a government-subsidized HMO. According to an article in AMNews ("N.Y. bailout won't cover individual insurers' losses," May 11, 1998), "New York state will pay $110 million to Oxford Health Plans, Empire Blue Cross Blue Shield and dozens of other carriers to offset losses in the individual insurance market." Oxford's share of this government loot is $10.6 million.

And, what did these HMOs do to win the "insurance pool lottery?" Well, they broke the law, of course...repeatedly. They violated the very patients whose money they will get as a "reward" from the state. "Widespread violations by HMOs of a 1996 patient protection law are prompting New York state officials and the medical society to call for tougher managed care legislation" ("Violations could prompt tougher oversight of N.Y. HMOs," AMNews, May 4, 1998). More laws, however, clearly are not the answer. The HMOs break the existing laws with impunity and are actually rewarded by the state for committing these crimes. Who says crime doesn't pay? In December 1997, Oxford Health Plans, Inc. was fined a record $3 million by New York state in addition to $500,000 it would have to make to physicians and patients by way of restitution ("Oxford Health Plans fined $3 million by state," The Buffalo News, Dec 24, 1997):

"The worst offenders [of the 1996 New York state patient protection law] are some of New York's largest HMOs: Oxford Health Plans, Aetna U.S. Healthcare of New York, Empire Blue Cross and Blue Shield and Health Insurance Plan of Greater New York, said Vacco [state attorney general] spokesman Marc Carey." So, let's see if we can do the math. Oxford Health Plans is fined $3 million for being one of the state's worst patient protection law breakers, and receives $10.6 million from the state. That means that Oxford was paid $7.6 million by New York state for their crimes. So the next time we hear someone whine that the "free market hasn't worked," implying that HMOs are somehow "free market," we will ask: What other free market business do you know of that is not only subsidized by the government but actually is paid millions for violating the law? And who would invest in a company that predicts that it will lose $29 million in 1998 in the individual insurance market alone ("N.Y. State bailout won't cover individual insurers' losses," AMNews, May 11, 1998)? Only the government with confiscated money, of course, via state-funded insurance pools. And, if that wasn't enough, Oxford had the gall to ask New York state for a whopping 69 percent hike in its premiums to cover its losses. They've got to maintain those multimillion dollar CEO salaries you know. But, apparently the state felt that the 10.6 million in state money was enough and they denied Oxford's request for a rate hike because they "spent too much on administrative functions." If Willie Sutton were alive today, it's clear what business he would be in, and it wouldn't be robbing banks.

Taxes are Voluntary

Although I don't normally read the form letters I get back from my congressmen when I write to them to complain about the abuses of HCFA or the IRS, I found something recently that I just can't ignore. Did you know, that we have a senior U.S. senator who thinks that we have a voluntary tax system? It's true; I'm not making this up. Senator Daniel Patrick Moynihan wrote to me recently and told me that "The mission of the IRS requires balancing the dual role of a law enforcement agency and a customer service provider." When was the last time you felt like you were getting "customer service" in your dealings with the IRS? He goes on to say that "Unfortunately, the law enforcement responsibility of the IRS has in some cases come to dominate the agency's approach to interacting with taxpayers." That's certainly an understatement for someone like himself who is the ranking democratic member on the Senate Finance Committee and who listened last fall to the many abuses the IRS has committed against innocent citizens. But, he's not done yet. He goes on to say:

"As a result, despite our reliance on a voluntary tax system, the IRS has become a source of fear and anxiety for some taxpayers." If it's a voluntary system, why do IRS agents keep showing up at peoples' homes and businesses with automatic weapons ("Veterinarian Says IRS Swat Team Raided His Home," The Post-Journal, Jan. 22, 1998)? We must also ask AAPS associate member Jacob Lapp if he felt he was dealing with a voluntary tax system when the IRS confiscated all of his milk money, his main source of family income during the past winter? This takes the Clintonite euphemism, "contribution," to its absurd extreme. Forget about misspelling potato - this is a far more serious problem. I am in favor of withholding pay until we can test certain congressmen to see if they know anything at all about our form of government and the way certain agencies like the IRS and HCFA really function. If taxes are truly voluntary as Senator Moynihan claims, then we should voluntarily have the freedom to choose not to pay them...Right?

This edition of News and Analysis was written by AAPS Board of Directors member, Lawrence R. Huntoon, MD, PhD.