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Dead doctors, dead patients and Illinois pays the tab

Wednesday, Sep 30, 2009

* A new Government Accountability Office audit out of DC has found some serious abuses of the Medicaid prescription program.

The GAO looked at five states, including Illinois. Those states alone made up 40 percent of Medicaid’s prescription-drug payments in fiscal years 2006 and 2007, according to a story in USA Today

[The five states] are not fully taking advantage of federal databases or technology that could spot fraud, the report said.

Not good at all.

Here’s what the GAO found…

• About 65,000 cases in which Medicaid beneficiaries visited six or more doctors and up to 46 pharmacies to acquire prescriptions — a practice known as “doctor shopping” that allows purchasers to exceed the legal limit of drugs.

• Sixty-five doctors or pharmacists writing or filling prescriptions after being banned from Medicaid, some for illegally selling such drugs.

• About 1,800 prescriptions written for dead patients and 1,200 prescriptions “written” by dead physicians.

Dead voters, dead patients and dead doctors. A perfect fit for Illinois [/snark].

In the big picture, we’re not talking about a gigantic dollar amount here. It’s less than $33 million per year for two years - and that’s all five states combined. If Illinois shares equally, that’s less than $7 million, or about $3.5 million in state dollars at a 50-50 match.

With the state’s ongoing budget problems, this could become an issue, however. The full GAO report is here.

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- Posted by Rich Miller        


17 Comments
  1. - VanillaMan - Wednesday, Sep 30, 09 @ 12:08 pm:

    Well then, if we don’t want to worry ourselves over the total cost of fraud here - then let’s focus on how the fraud wasn’t detected. Let’s focus on the fact that this isn’t what taxpayers should expect from this system. Let’s focus on the fact that common sense utterly failed here, repeatedly.

    Then we need to ask ourselves if this is the kind of system we should be expected to pay for.

    Say you have a car that leaks gasoline. After putting buckets under the various spots where leaks are detected, imagine that you then decide that since you can afford the costs of the leaks, you just don’t fix them. You don’t question the fact that your car shouldn’t have leaks? You don’t question whether the car has other problems besides leaks? You don’t take the car into a mechanic to fix it?

    What we are seeing here is wholesale failure. Whether we can afford it, really isn’t the point.


  2. - Leave a Light on George - Wednesday, Sep 30, 09 @ 12:14 pm:

    “In the big picture, we’re not talking about a gigantic dollar amount here. It’s less than $33 million per year for two years - and that’s all five states combined. If Illinois shares equally, that’s less than $7 million, or about $3.5 million in state dollars at a 50-50 match.”

    Don’t cut this. Don’t cut that. Don’t lay off anybody. Don’t fumigate hacks. Don’t improve efficiencies. Why? Because we are told the $ saved doesn’t ever amount to anything.

    Baloney! Start making some of these “small” (in the millions) savings and our budget will be in better shape. Maybe not fixed but in a heck of better spot than it is now.


  3. - cassandra - Wednesday, Sep 30, 09 @ 12:19 pm:

    It’s important to remember that in Illinois, layoffs in state government, by and large, do not mean those being laid off will actually lose their jobs. For the most part, the now probably defunct layoffs in Corrections meant that those affected would have to work someplace else, with the same pay and benefits. And I don’t believe any Blago or Quinn appointees were being laid off. Apparently, if you work in a union-covered job in Illinois state government, you not only get lifetime job security unrelated to job performance and rare health and pension benefits, but also you get to stay in the workplace you prefer for life, too. Even if that workplace really doesn’t need the staff. This may sound like bureaucratic science fiction but it’s not.

    I guess a vote for Quinn in February means that we are happy to pay for all these goodies, and thus for a large tax increase, because he sure as heck will raise our income taxes in March if we give him the thumbs up in February. Without cutting a thing.


  4. - Amalia - Wednesday, Sep 30, 09 @ 12:23 pm:

    It’s Medicaid and there is big fraud just when we are trying to make sure people who cannot afford healthcare get it. Those who are abusing the Medicaid system are really rotten people and should be rooted out and punished. It’s cases like these which make those who hate government involvement in healthcare laugh.


  5. - wordslinger - Wednesday, Sep 30, 09 @ 12:28 pm:

    Even with summer’s Sturm & Drang, I don’t believe we’ve even begun to face the facts on how much health care is going to cost us in the very near future.

    Just a couple of very common examples from my own life:

    –My mother has had full-blown Alzheimer’s for five years. After a group home experience (at $3,000 a month), she’s been in an Alzheimer’s wing of the county home for three years at $6,000 a month. She burned through her assets in two years, now Medicare pays.

    –My mother-in-law broke her hip, that used to be a death sentence. Last week, she got a replacement hip the very next day. Now she’s walking again, but will be in the hospital for a total of about three weeks. Medicare pays for it all.

    We’re all living longer and the medical and pharma community come up with more and more amazing ways for us to do it well. How in the world are we going to pay for it?


  6. - hmmm - Wednesday, Sep 30, 09 @ 12:29 pm:

    I think the computer systems they are looking for would require about a 50 - 100 million dollar overhall of the state computer systems.

    We aren’t paying to stop fraud, and I doubt there would be any support to spend that kind of money.


  7. - Responsa - Wednesday, Sep 30, 09 @ 12:34 pm:

    Dam-mit seven million IS a gigantic amount of money whether it’s taken from federal or state coffers/tax dollars. And systematic fraud, whether small or large, sickens and enrages taxpayers like me who feel utterly helpless to stop it. IMO, this kind of thing is also one of the reasons the health reform legislation is having a hard time in polls. The average American simply does not trust either the federal, state (or in our case county) government to manage, respect, and protect our hard earned tax money anymore.


  8. - Cindy Lou - Wednesday, Sep 30, 09 @ 1:26 pm:

    Cassandra –”Apparently, if you work in a union-covered job in Illinois state government, you not only get lifetime job security unrelated to job performance and rare health and pension benefits, but also you get to stay in the workplace you prefer for life, too”–

    As usual, not a clue, but hey, don’t let things like facts and differences in contracts and supplementals get in your way of a ‘good’ rant, Cassandra.


  9. - South Side Mike - Wednesday, Sep 30, 09 @ 1:38 pm:

    Rich,

    Another couple of points about the budget numbers and fraud: first, GAO does not purport to have caught all fraudulent drug prescription behaivor in these states. The GAO focused on only 10 classes of controlled substances, doctor shopping was defined as prescriptions by 6 or more physicians, etc.

    Second, GAO notes that they did not include the costs of visits to the doctors to get the prescriptions. For the doctor shoppers who sought prescriptions from over 50 physicians, that’s a lot of Medicaid payments!

    If Illinois were to enact some of the fraud controls suggested in the report, the savings could be substantially larger than the simple average fraudulent drug cost per state. Fraud in other areas of Medicaid might be detected as well. And if such controls could be cost-effectively applied to Medicare payments as well, you could see much, much larger savings.

    Wordslinger and others, please note, this study was done on Medicaid only- not Medicare. The amount of fraud in Medicare, especially related to dead patients, is probably much higher than in Medicaid.


  10. - Ghost - Wednesday, Sep 30, 09 @ 2:29 pm:

    So the Gov run health care system is missing simple to find fraud; where the private insureamce companies rabidly inspect everything to avoid it, and end up denying claims they should pay.

    Seems like we need a middle ground; private insurance with regulation over denials.


  11. - VanillaMan - Wednesday, Sep 30, 09 @ 3:25 pm:

    So the Gov run health care system is missing simple to find fraud; where the private insureamce companies rabidly inspect everything to avoid it, and end up denying claims they should pay.

    In the case of the government, they don’t care because it isn’t their money. In the case of the insurers, they care because it is their money. Any organization wastes what isn’t theirs. This is why governments are inherently wasteful.

    Imagine that it is your money, (because it is), what would you prefer doing? Ensuring that every dollar you spend is spent correctly, or just shoveling it out because you don’t want to appear stingy?

    What would you do if you discover that your money is being wasted?

    We live in challenging times. We are not wealthy enough to have any other attitude than a strong commitment to spend every dollar wisely.


  12. - Budget Watcher - Wednesday, Sep 30, 09 @ 3:56 pm:

    It’s a very difficult balancing act trying to combat Medicaid fraud while at the same time trying to ensure poor citizens get adequate care and providers get paid for the services they provide. The fact is that some cheaters don’t get caught despite the efforts at HFS. If HFS were to tighted up their utilization controls to stop the bad folks, they risk denying access to care to many that truly need Medicaid. To put the “fraud” number in todays GAO story into perspective, it’s about 0.5% of total Medicaid drug outlays. It means they get it right 99.5% of the time. But of corse it’s the misses that make the story.


  13. - Honest Abe - Wednesday, Sep 30, 09 @ 4:21 pm:

    Where was a Blago appointee, Inspector General John Allen of Health Care and Family Services on the dead doc issue? It is his responsibility to detect these things. This has come up before but largely been ignore.


  14. - steve schnorf - Wednesday, Sep 30, 09 @ 8:00 pm:

    At least in the past, the feds generally took the position that state’s should seek control of abuse and fraud up to the point that it ceased to be cost-efficient. In business, your accountants and auditors would tell you not to spend dollars chasing dimes. I don’t know enough to evaluate this particular situation, but I believe we shouldn’t push for non cost-efficient anti fraud efforts.


  15. - Emily Booth - Wednesday, Sep 30, 09 @ 9:04 pm:

    So what you’re saying is the government, of the people, by the people, and for the people, should continue to misspend the dollars it takes out of working people’s paychecks and, not only misspend but sanction criminal behavior, all because it’s not worth it? Phooey.


  16. - Doc Shocker - Thursday, Oct 1, 09 @ 12:27 am:

    “Those who are abusing the Medicaid system are really rotten people and should be rooted out and punished.”

    No, in this case they’re addicts. They need help, not punishment.
    We could get them all rapid detox!, spend 650 million to save 33 million…oh wait.


  17. - South Side Mike - Thursday, Oct 1, 09 @ 7:39 am:

    Budget Watcher,

    You make the mistake of assuming that the GAO caught all drug fraud in Medicaid. It does not claim that! It doesn’t even purport to have caught all fraud in the 10 classes of drugs examined. It simply examined the data to determine the egregious examples of doctor shopping and false prescriptions. If the GAO can do something like this in a few months for 5 states, imagine what it could uncover if it did a full investigation (I guarantee it will be more than .5% of Medicaid drug expenditures)! Now, Steve is right, you don’t install a billion dollar monitoring program to save $50 million. But some of the controls that the GAO found lacking (tracking dead patients and dead doctors, for starters) should not be cost prohibitive to implement.


Sorry, comments for this post are now closed.


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