Author: WorkCompAcademy

Doctors who are the most worried about malpractice suits are more likely than less fearful colleagues to order extra diagnostic tests and refer patients to emergency rooms, even if the real threat of a lawsuit is low, according to a new U.S. study reported in Reuters Health.

The practice of so-called defensive medicine “is one of those things that everyone knows goes on, but doesn’t know how to control,” said Michelle Mello, senior author of the new analysis and a professor of law and public health at the Harvard School of Public Health in Boston. The problem is a driver of excessive healthcare costs, but tackling it effectively requires a better understanding of what drives defensive medicine, Mello and her colleagues write in the journal Health Affairs.

In earlier research, Mello found that medical liability and defensive medicine accounted for approximately $55.6 billion or 2.4 percent of U.S. healthcare spending in 2008. “It’s an area where we can chip away at healthcare costs without causing pain to the patient, since these are services ordered not primarily because doctors think they’re medically necessary,” Mello told Reuters Health.

Past research has surveyed doctors about their behavior or their level of concern about malpractice, according to Emily Carrier, a senior researcher at the Center for Studying Health System Change in Washington D.C. and lead author of the new study. Other researchers have gauged the amount of defensive medicine in everyday practice by looking at insurance claims, she said.

To get a better sense of the reasons doctors may engage in defensive medicine, Carrier, Mello and their coauthors combined both approaches. The researchers started with a database of 1.9 million Medicare claims for 2008 as well as responses to a survey that same year that asked some 3,400 doctors about their malpractice concerns. Among the Medicare patients in the database, there were 29,000 who had visited an office-based physician that year for one of three complaints: chest pain, lower back pain or headache, but who were not later diagnosed with a serious illness related to that complaint. “The three complaints were chosen, in part, because each could indicate relatively minor problems, but could also suggest more severe and even life-threatening issues that would be likely to trigger testing in a risk-averse provider,” Carrier told Reuters Health in an email.

Based on the survey results, the researchers designated doctors as having a low, medium or high level of concern about malpractice, and then linked those doctors using the claims data to the tests they had ordered for patients. The team found that patients with a headache who saw a physician with a high level of malpractice concern were more likely to receive advanced imaging like a CT scan, than patients who saw a doctor less worried about malpractice. More than 11 percent of the headache patients seen by a physician with a high level of concern got additional services and testing, versus 6 percent of patients seen by a physician with a low level of concern.

Almost 30 percent of patients with lower back pain seen by a physician with high malpractice concern were given additional imaging services, compared with 18 percent of patients who saw a physician with low concern.

For chest pains, however, the less worried physicians were about malpractice, the more likely they were to order a stress test. Stress tests can involve running on a treadmill, or taking medication to make the heart work harder. Carrier said physicians who are already nervous about medical liability might avoid this test and instead choose to admit the patient to a hospital for more evaluation.

The study also found that physicians’ level of malpractice concern didn’t change, even if they were practicing in a state with medical liability reforms like caps on how much money patients can claim in damages. “Even with caps or other reform measures, it’ doesn’t make physicians feel safer,” Mello said. “We are finding that the focus should be on how physicians are feeling – that has real implications for future policies.”

ICD-10 is the 10th revision of the International Statistical Classification of Diseases and Related Health Problems (ICD), a medical classification list by the World Health Organization (WHO). It codes for diseases, signs and symptoms, abnormal findings, complaints, social circumstances, and external causes of injury or diseases. The deadline for the United States to begin using Clinical Modification ICD-10-CM for diagnosis coding and Procedure Coding System ICD-10-PCS for inpatient hospital procedure coding is currently October 1, 2014. The deadline was previously October 1, 2013. All HIPAA “covered entities” must make the change.

They might not have to play by all the same rules, but healthcare providers should not forget the impact ICD-10 will have on non-HIPAA covered entities such as workers compensation, nursing homes, and home health agencies. While non-HIPAA entities are not mandated to switch to the new code set on October 1, 2014, the changing tide will sweep them along with the complex transition whether they like it or not. Medical providers should be aware of the struggles of their non-HIPAA partners, especially as the care coordination spectrum expands to include more and more external organizations that may not always be on the same page.

It may seem like those entities that are allowed to stick with ICD-9 would be happy to do so. But in fact, staying with the old code set, which will not be maintained or updated after 2014, might be more trouble than it’s worth. Technically, workers compensation insurance could demand all provider claims to contain ICD-9 codes for as long as they please, but the undue hardship that would place on medical professionals has been deemed too great by some large insurance plans such as the Ohio Bureau of Workers Compensation (OBWC), which is planning to use ICD-10 after the implementation date.

Non-HIPAA entities could also choose to accept ICD-10 codes from providers but crosswalk them back to ICD-9 if they don’t want to upgrade their systems. But the extra work to create accurate and reliable mappings from a very detailed code to a broader ICD-9 one seems a little pointless. “Even though claims professionals don’t have to be immediately fluent in ICD-10, they should be forward-thinking and follow the market in the direction it’s headed,” suggests John Sarich, VP of Strategy for VUE Software in a post for Claims Journal. “It will require some upfront investment, but will ultimately outweigh the lost time that accompanies translating every medical record you encounter.”

And payers such as workers compensation and property and casualty insurance do have a vested interest in the detail and specificity provided by ICD-10, mandate or no. They will spend less time pestering physicians for more and more documentation to validate a claim for an injury, reducing the administrative burden for everyone involved – assuming payer claims processors are properly trained in the new code set and don’t need to return to the provider to ask for clarification.

Insurance industry groups have been planning for the ICD-10 switch alongside their medical peers, with major organizations such as the Work Loss Data Institute and the National Council on Compensation Insurance updating their documentation and handbooks accordingly. But just as medical providers and payers are struggling with the requirements for the complex and costly transition, non-HIPAA entities are also facing challenges.

A CNN Investigation into fraudulent drug rehabilitation clinics concluded that the populous Los Angeles region is one of the nation’s top hot spots for health care fraud, and former state officials agree it is also ground zero for the rehab racket. To uncover this story on widespread fraud linked to California’s drug rehab program, CNN’s Special Investigations Unit has teamed up with the independent, nonprofit Center for Investigative Reporting as part of Anderson Cooper AC360’s “Keeping them Honest” reports.

Investigative reporters were were stationed in parked cars outside the offices of Able Family Support in the San Fernando Valley, counting the people who came and went on April 4. The clinic, reimbursed by taxpayers for each client it sees, offers in-person drug and alcohol counseling. And Able Family is thriving, according to its billing records.

But according to the reporters, no more than 30 people trickle into the rehab center on April 4 until the doors are locked 10 hours later.

The counting resumed a month later when the clinic submitted its bill to Los Angeles County seeking reimbursement — not for 30 people, but for 179. The government promptly paid it — $6,400 for clients Able Family reported it saw April 4. When told of the April 4 stakeout at Able Family, county regulators said they now have questions about whether the payments were legitimate. The findings merit a closer review but “look very incriminating,” said a spokeswoman for Los Angeles County’s substance abuse department. Able Family operates a small satellite clinic near downtown, the county noted — but a security guard there said about 25 people came to that office each day.

The simple stakeout on April 4 raises questions about the adequacy of government oversight of the program to help the poor and addicted, built on an honor system in which honor often is lacking. Oversight is marred by infrequent and cursory inspections and by a failure to act even when red flags appear. CIR and CNN have exposed how clinics use coercion and forgery to defraud a taxpayer-funded program meant to help struggling addicts..The investigation also found that people ineligible to run Medi-Cal clinics did not just slip through the cracks — they walked through doors regulators left wide open.

The Able Family Support Clinic’s director, Alexander Ferdman, would not explain the discrepancy. “I can’t explain, because you will cut and paste and edit, and my answers will be to a totally different question,” Ferdman said in a telephone interview, before hanging up. Felons are supposed to be blocked from running clinics. That didn’t stop Ferdman. He entered the rehab racket two years after leaving a Texas prison, where he served time for orchestrating an organized crime scam. Over the course of a decade, he built his clinic into a $2 million-a-year operation — all from taxpayer money. Prosecutors in Texas had pegged Ferdman as the ringleader of a scam that robbed auto insurers of millions. An indictment from the Travis County district attorney’s office says a team of fixers staged crashes and recruited actual crash victims as pawns to generate fake legal and medical bills. One witness described Ferdman as the man who paid off operatives from a briefcase full of cash.

CNN claims that Drug Medi-Cal paid out $94 million in the past two fiscal years to 56 clinics in Southern California that have shown signs of deception or questionable billing practices, representing half of all public funding to the program, CIR and CNN found. Over the past six years, more than half a billion dollars have poured into the program statewide.

A new California Workers’ Compensation Institute (CWCI) report suggests that the number of work injury claims involving obesity could increase sharply, along with the associated costs, following the recent vote by the American Medical Association (AMA) to reclassify obesity as a treatable disease.

In mid-June, the AMA approved a resolution reclassifying obesity as “a disease state,” effectively declaring that one third of all Americans suffer from a medical condition that requires treatment, a move that is widely expected to increase pressure on doctors to address the condition when treating obese patients, and on health care payers to pay for obesity consultations and treatment. And that designation, according to the report, will likely affect diverse areas of employment, including the Americans with Disability Act and Equal Employment Opportunity Commission claims; life, disability, and workers’ compensation insurance; weight bias; insurer and provider responsibility; physician reimbursement; and diagnostic and procedure coding.

In workers’ compensation, obesity has historically been a co-morbidity – a condition that occurs at the same time, but usually independent of, an injury or illness. In the past, a medical provider might include an obesity co-morbidity code on their medical bill if they felt the condition needed to be addressed so that the work injury could be treated and the patient could recover and return to work (e.g., if an obese injured worker needed to lose weight before they could have back surgery.) Even as a co-morbidity, however, obesity in workers’ compensation has gone largely unreported. A CWCI survey from 2011 found that even though 28% of injured workers reported that they were obese, only 0.9% of the job injury claims from those workers included an obesity co-morbidity diagnostic code, indicating that obesity has only infrequently been deemed a condition that needed to be addressed in order to treat most work injuries and illnesses.

CWCI says that may change, however, if medical providers feel a greater responsibility to counsel obese patients about their weight and to treat the condition, especially if there is a greater likelihood that they will be paid for doing so. Aside from its status as a comorbidity, obesity could become a primary workers’ comp diagnosis, particularly in sedentary jobs like office work, or long-haul trucking, according to the report.

“In such scenarios the viability of the claim would likely hinge on proving that the work actually caused the obesity, which would be an issue ripe for dispute and which could lead to additional litigation,” the report states. “In light of the increasing evidence of genetic pre-disposition for various medical conditions, defining causation and relative causation will be critical in claims involving obesity, and also may arise in other employment areas such as pre-employment screening.”

The “disease” designation doesn’t bode well for employers or for long-term workers’ comp rates employers may be faced with paying if claims do rise, said Jerry Azevedo, a spokesman for the Workers’ Compensation Action Network, a group that represents the interests of employers. “The implications are grim, especially if statutory or case law proves ineffective in limiting employers’ liability to true industrial causation or direct compensable consequences,” Azavedo said. “Unfortunately, there’s a tension created through litigation in the workers’ comp system, where plaintiffs’ lawyers want to make everything under the sun a part of the injury claim to run up the bills and inflate benefits. Employers are forced to defend against that and have fought hard for policies that reinforce what should really just be common sense – which is employers should pay for what was directly caused by the work injury. ”

Michael Vincent Petronella owned several businesses, including The Reroofing Specialists, Inc., doing business as Petronella Roofing, Western Cleanoff, Inc., and Petronella Corporation. In September 2006, an SCIF claims adjuster received a telephone call from Petronella Roofing’s secretary, reporting an employee named Morales was still receiving workers’ compensation benefits although he had returned to work. The adjuster asked the secretary to provide documentation. She received a copy of Morales’s pay stub, reflecting he worked for Western. Noticing that Western had been reported to be dormant and removed from coverage under the policy, but was still listed as an active entity on the Secretary of State’s Web site, the adjuster reported the discrepancy to SCIF’s special investigations unit.

An SCIF claims manager compiled a list of 42 persons who filed workers’ compensation claims under Petronella Roofing’s policy whose payroll had not been reported to SCIF. A certified public accountant compared the payroll reports and audit documents defendant provided SCIF with the quarterly employee wage reports actually received by EDD. The accountant prepared a report reflecting the difference between the quarterly payroll defendant reported to EDD and the payroll reports he submitted to SCIF from the fourth quarter of 2000 to the fourth quarter of 2008. Over that 8-year span, the difference in payroll reported to EDD and that reported to SCIF exceeded $29 million.

The prosecution charged defendant with one count of grand theft, 36 counts of violating Insurance Code section 11880, subdivision (a), plus numerous tax evasion crimes. The information also alleged an enhancement under Penal Code section 186.11, subdivision (a). During trial, the court dismissed the grand theft charge at the prosecution’s request and granted defendant’s motion for acquittal on the bulk of the tax evasion charges. The jury found defendant guilty of 33 counts of violating Insurance Code section 11880, subdivision (a), but acquitted him on three other similar counts and the remaining tax evasion charges. As to counts 2 through 20, the jury returned true findings the prosecution of these charges began within four years of when the crime reasonably should have been discovered. Finally, the jury also found defendant engaged in a pattern of related fraudulent felony conduct resulting in over $500,000 in losses.

The superior court sentenced defendant to 10 years in state prison. It also and ordered him to pay $500,000 in restitution under Penal Code section 1202.4. Defendant appeals from the judgment raising numerous evidentiary, instructional, and sentencing issues. Both defendant and the People appeal from the trial court’s restitution award. The Court of Appeal reversed the trial court’s restitution order, but otherwise affirmed the judgment in the published case of The People v Michael Vincent Petronella.

The Court concluded that “a review of the trial court’s reasons for awarding SCIF $500,000 in restitution clearly indicates it abused its discretion in reaching this decision.” By ” failing to consider all of the evidence presented to it concerning restitution and relying on irrelevant factors to pick a figure out of thin air that was less than what the jury found to have been SCIF’s loss…” The matter was remanded to the Superior Court for further proceedings on the restitution award.