Updated on: November 29, -0001

CMS Proposes Major Education Effort Aimed at Physicians to Combat Waste, Fraud and Abuse

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Original story posted on: September 27, 2013

Recognizing that approximately $765 billion in healthcare spending is lost to error, waste, fraud and abuse annually, the Centers for Medicare & Medicaid Services (CMS) is proposing a major educational effort aimed at physicians, whom the agency describes as the nation’s “principal gatekeepers” who decide when and how healthcare services are delivered.

An overview of the effort’s curriculum appears today in an article titled, “Expanding Physician Education in Health Care Fraud and Program Integrity.” Published in Academic Medicine, the periodic journal of the Association of American Medical Colleges, the article has been posted to the website of the Office of Inspector General for the U.S. Department of Health and Human Services.

The article’s authors, including Shantanu Agrawal, MD, medical director and director of data sharing and partnership for program integrity at CMS, acknowledge that program integrity (PI) covers “the entire spectrum of improper payments, from fraud to abuse, errors, and waste in the health care system.” Moreover, the authors note that few physicians perpetrate either fraud or abuse, but that “nearly all will contribute to the remaining spectrum of improper payments.” Thus, conclude the authors, “preventive education in this area (is) vital.”

What the authors are proposing is a model of PI education that can be embraced by physicians and various stakeholder organizations, then implemented nationwide. Furthermore, they recommend that stakeholders actually take part in the development and implementation of PI education – recognizing, however, that educating physicians is merely an essential first step in establishing what they describe as “a broader culture of compliance and improved integrity in the health care system, extending beyond Medicare and Medicaid.”

Quoting from a 2012 study by the Institute of Medicine, the authors noted the aforementioned statistic indicating that the U.S. healthcare system loses about $765 billion a year to waste. Of that $765 billion, about $210 billion is attributable to unnecessary services, $190 billion to excess administrative costs, $130 billion to inefficiently delivered services, $105 billion to excessive prices, $75 billion to fraud, and $55 billion to missed prevention opportunities.

“Physicians generate improper payments not only from the services they perform and bill directly, but also from the services and supplies that they either order or for which they make referrals, such as durable medical equipment, diagnostics, laboratory analyses, and prescription drugs,” the authors report, noting that “expenditures for such physician-authorized services and supplies far outstrip physician professional fees.”

Citing an example of improper payments, the authors note that diabetic supplies often are provided in excessive quantities or to beneficiaries who do not need them.

“These improper payments are caused in part by the lack of appropriate physician documentation accompanying orders. Payment errors for glucose measuring supplies, for example, amounted to more than $1 billion in waste in 2010 for Medicare alone,” they reported, reminding readers that lost resources are “potentially being diverted from supporting needed healthcare services.”

Recognizing the enormous impact that PI issues have on public and private insurance programs, the authors contend that physicians receive little formal education in PI, and that their lack of awareness makes them “more likely to submit inappropriate claims, generate orders that other providers and suppliers will use to submit inappropriate claims, and document improperly in the medical record.”

”Also,” they concluded, “(they are) more likely to become victims of fraud schemes themselves.”

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Chuck Buck is the publisher of RACmonitor.

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Read: “Expanding Physician Education in Health Care Fraud and Program Integrity.”  

Chuck Buck

Chuck Buck is the publisher of RACmonitor and is the program host and executive producer of Monitor Monday.

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