Tiny Little Rip-Offs

Tiny Little Rip-Offs

by / June 2, 2008

I suspect one of my relatives is being taken advantage of by her doctor. In fact, I think most Americans are being taken advantage of by this relative's doctor.

After sticking to a healthy lifestyle for most of her life, she doesn't worry anymore about certain aspects of her health. Her doctor tells her she should take cholesterol medication, but she refuses. In fact, she stubbornly turns down medication for almost everything. Even so, her doctor administers costly in-office tests at every monthly check up - even when my relative has already refused to take action based on the same tests at previous visits.

After accompanying her to see this doctor and hearing from other family members who have accompanied her, it seems the doctor - who specializes in care for the elderly - cares as little about these test results as my relative. I can only assume the tests are being ordered simply as a mechanism for regular billing. Unfortunately a few extra dollars in the doctor's pocket - and other pockets like his - is costing us all a lot of money.

For the most part, my relative never sees a bill for these tests. The government pays the majority of the costs, and a secondary insurance provider picks up the rest. When an explanation of benefits arrives in her mailbox, she often doesn't remember what it's for.

As more people begin to see government programs, such as Medicare and Medicaid, as opportunities to increase their own wealth, these tiny little rip-offs add up to a big drain on the health-care system, state budgets and our economy as a whole.

Because fraud and abuse often go undetected, it is hard to determine exactly how much public money is paid out to unscrupulous billers and undeserving recipients. The National Health Care Anti-Fraud Association estimates that more than $60 billion per year is wasted on fraudulent claims across the health-care industry. And as the federal government tightens Medicaid spending, it's incumbent on states to make the most of the remaining dollars.

In this issue, Features Editor Andy Opsahl shows how some state governments use IT to ease the cost challenges associated with government health programs.

One particularly interesting case comes from California, where the state uses technology to spot Medicaid abusers and stay ahead of the fraud game. While automation reduces costs of billing processes for government programs, it also opens the door to a new breed of crooks who repeatedly bill for services they know will be automatically approved.  

Using predictive analytics, California not only identifies fraudulent Medicaid billers, but also discovers new fraud patterns as crooks learn how to avoid the old pitfalls.

With numerous other economic woes beating down on the economy, the spotlight on health care has dimmed slightly in the public eye. But long-term, everyone knows the health-care crisis must be addressed, and states are looking to technology to reduce its impact now and in the future.