Real Money

UnitedHealth and other insurers reported their first half revenues and earnings for 2018.  UnitedHealth’s revenue jumped to over $110 Billion and Anthem’s revenue also increased.  Earnings on these exceedingly large revenue streams were over $8 Billion for UnitedHealth and Aetna’s was over $2.4 Billion.  These are the two largest health insurers in the United States.

UnitedHealth has been using its increased revenue and earnings to purchase back its shares.  UnitedHealth spent $3.2 Billion in 2018 first half share repurchases.  The same reports indicate in 2017, former UnitedHealth CEO, Steven Hemsley and current CEO, David Wichmann, earned together more than $110 Million.

Can You Hear Me?

Pew Charitable Trust recently released a report on the role of patient matching in the use of digital health records or electronic health records (EHR).  I have previously written about the fundamental flaw in the EHR premise that has emerged-the failure of various vendors and brands of EHRs being able to share information effectively.

The current generation of systems often use proprietary systems and coding which effectively prevents efficient communication and EHR sharing.  Pew, as it often does, looked deep into the problems regarding successful exchange of health information (interoperability).

One of the fundamental issues currently is patient matching, the ability to quickly, successfully and accurately identify and search an individual’s records in different locations and spread across time periods and know that the records all correctly refer to the correctly identified person.

The lack of common standards and the existence of proprietary systems mean simple things such as placing basic identifying information - an individual’s last name, Social Security Number and date of birth - in the same record location and in the same format in every system would drastically improve patient matching.  Pew makes recommendations including government funding for unique identifiers, agreement on demographic standards, research on and adoption of referential matching (use of more and different types of information) and verification strategies.

Effective EHR interoperability can be cost effective, reducing the number of repeat tests for a patient, reducing delays in care, improving the quality of care for patients and improving the recovery of costs from insurers.  That we have room to improve is clear, some match rates are 90%, some are as low as 10%.  The Pew report is fascinating to read for those who care about patients and for those who care about healthcare providers all ending up with better outcomes.

Billing Accuracy

Healthcare Partners Holdings, LLC a unit of DaVita Medical Holdings (DaVita) agreed to pay $270 Million to CMS for providing inaccurate information that caused its Medicaid Advantage plan receive higher Medicare payments.  DaVita acquired Healthcare Partners in 2012 for $4.91B and found that Healthcare Partners filed improper medical coding guidance instructing its physicians to use improper diagnoses codes for certain conditions that yielded higher reimbursements.  After making a self disclosure to CMS, the subsequent audit found DaVita’s concerns were correct and it also found other repayment claims.  Finally, this settlement also resolves whistleblower allegations that Healthcare Partners engaged in “one-way” chart/billing reviews and only submitted misdiagnoses when the reimbursement would increase and did not reveal the results of chart audits that indicated any sort of reimbursement or repayment should be paid by Healthcare Partners.

Crazy Schemes

Riyaz Mazcuri, is a former Attending Psychiatrist in Houston, was sentenced to 150 months in prison and ordered to pay over $20 Million in restitution to Medicare and over $2 Million in restitution to Medicaid.  A jury convicted Mazcuri of one count of conspiracy to commit healthcare fraud and five counts of healthcare fraud.

It appeared that Mazcuri and others submitted to Medicare $155 Million of false and fraudulent claims for Partial Hospital Program (PHP) services.  PHP is a form of intensive outpatient treatment for patients with severe mental illness.  These claims including billing for treatment never provided, for indiscriminate admissions and readmissions into PHP service programs, false medical records and false documents.  Fifteen others, including the former President of the Houston hospital involved, have also been convicted.

Speak Up

A baby step has been taken to lower the price of prescription drugs.  Congress has passed the “Patient Right to Know Drug Prices Act” a bipartisan bill that will block insurers or PBMs from prohibiting pharmacies from informing you of any difference between your co-pay and the cash price of a prescription drug and to give advice as to how you may pay less by paying directly or any other method.

Kentucky’s Senator Rand Paul voted against the measure.

This newsletter is edited by Paul Wallace of Jones • Wallace, LLC, a member of the American Bar Association Healthcare Law Section and the American Health Lawyers Association who has been representing physicians and healthcare practices for over 25 years.  Mr. Wallace assists physicians, practices and hospitals in contract items, federal legal compliance, practice entity creation, estate and wealth planning and similar issues.  Please feel free to call if you have any questions on this newsletter or legal matters at (812) 402-1600 or pwallace@joneswallace.com.