SO EMBARRASSING!

Earlier this year the Indiana State Medical Association lost a laptop computer and two hard drives.  Unfortunately, stored on the computer and hard drives were the social security numbers, medical history and other personal information of nearly 40,000 people in the Association’s group health and life insurance plans.  The theft from the car was reported more than 24 hours later, and at a different location.

The Association’s spokesperson seemed to find a silver lining in the cloud by saying “Many of the people involved in our breach were already involved in the much-larger Anthem breach.”

LOST IN THE FOREST

A May 2015 report from the Government Accountability Office (GAO) examined Medicaid only enrollees in certain groups.  The important findings:

• The most expensive 1% of Medicaid only enrollees account for one-quarter of Medicaid expenditures.
• The most expensive 5% account for nearly one-half of the expenditures.
• The most expensive 25% accounted for more than 75% of the expenditures.
• As a contrast, the least expensive 50% accounted for less than 8% of Medicaid expenditures.

The report found that its findings were valid across several years.  The information presented allows some further extrapolation.  Certain groups are disproportionally represented in the high expenditure groups, including enrollees with diabetes, mental health issues and substance abuse conditions.  It will be interesting to see whether Medicaid (and Medicare) can begin to put together a comprehensive plan to provide proper, preventive or maintenance care, as opposed to crisis intervention high expenditure cost treatment of these groups which, literally, are using so many resources in Medicaid, that insufficient dollars remain for practical and efficient treatment for the 75% or 85% of the population that are not high cost patients.  It also leaves insufficient funds for innovative research and programs to provide better health for all.

We do not suggest limiting treatment for high users and high cost users, but a more intelligent approach to use the limited funding available in a humane but efficient manner.  Obviously, we cannot continue with a state or national health plan where 5% of users use 50% of the funds.

GOOD CONTRAST

The preceding article talked about the billions and billions of dollars in state and federal funds for 1% or 5% of the population.  It is an interesting contrast to those many billions of dollars that an OIG report is greatly concerned that some errors in place-of-service coding led to a $33.4M potential overpayment amount for incorrect place-of-service coding.  Given the enormity of the issues described in the preceding article, we wonder if OIG and others should not be wasting their/our time with over wrought RAC audits and statistical sampling of doctor billing which results in a relatively small issue, and be instead focusing on core care and affordability issues.

LOW VOLUME HOSPITALS/TREATMENTS

A recent US News article series analyzed data with regard to hospitals that perform low volumes of certain treatments and compared negative outcomes at these low volume centers at higher volume hospitals.  Their conclusions covered knee and hip replacement, coronary bypass surgery and other surgeries and treatments.  Outcomes were substantially worse for the lowest volume fifth of the hospitals when compared to the highest volume fifth.  In one case, the analysis indicated that for Medicare data, the relative risk of death for elective knee replacement patients at the lower volume hospitals was 24 times the national average.  For hip replacement patients the risk was nearly 50% higher and for patients with congestive heart failure and chronic obstructed pulmonary disease, the risk increase was 20%.

Looking beyond mortality, revisions are 20% higher among knee patients and 20% for hip patients are the lowest volume fifth.

What to do?  Ask questions.  Ask about the volume that the hospital and assigned surgeon do a specific procedure in a year.  Ask about the hospital and surgeon infection rate.  Ask if the surgical approach or device proposed for an operation is new to the hospital or surgeon.  Then do your homework.

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 in health practices in contract items, federal legal compliance, creation of practice entities, 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.