Health care's widespread overbilling problem - Axios
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Health care's widespread overbilling problem

Eric Gay / AP

The health care system's complex payment system gives doctors and hospitals lots of incentives to bill for more expensive services than they actually provide, a practice known as upcoding. Numerous settlements between health care companies and the Department of Justice indicate it's a widespread problem.

Why it matters: Upcoding affects everyone — it saps money from the taxpayer-funded Medicare and Medicaid programs and could lead to higher premiums for people with commercial insurance. But there's no evidence the health care system is fighting upcoding effectively, or that the problem will go away.

The basics of upcoding: Health care providers document what they do as much as possible because they want to maximize their revenue and profit in an era of declining payments. Just take a quick glance at the multitude of industry coding webinars, including one titled "Keeping up with the Code-ashians."

But this can spur people to exaggerate medical claims or willfully overbill.

  • Carolinas HealthCare System, a hospital system based in North Carolina, paid $6.5 million to the Department of Justice last month to settle allegations that it knowingly overcharged Medicare and Medicaid for urine drug tests.
  • Instead of coding for the lower-paying "moderate complexity" urine drug tests, Carolinas' doctors allegedly used "high complexity" codes. The settlement cleared Carolinas of liability.
  • The services that are most vulnerable to upcoding are routine doctors' visits, known in the medical billing world as "evaluation and management" visits, and lab services. Billions of dollars have been wasted on those incorrectly coded services, according to the federal government.
  • This practice is separate from fraudulently billing for services that were never provided or weren't necessary, but it's a fine line.
  • There have been numerous other upcoding settlements with the Department of Justice over the past several years, including a $60 million settlement against IPC Healthcare, a national doctors group that was bought by TeamHealth.

Part of the problem is not every doctor or coder views medical services the same way. Notes and codes are vague, and interpretations can be different.

"You couple that ambiguity with a system that rewards increasing intensity of services, and it shouldn't be surprising that you wind up with upcoding," said Christopher Brunt, a health economist at Georgia Southern University who has studied the issue.

Punishments don't appear to be working: The financial penalties for upcoding can be severe, especially for smaller doctor groups. But the Department of Justice doesn't appear to be changing behaviors among the larger organizations. Carolinas' $6.5 million settlement, for example, is just 0.1% of the hospital system's revenue, or 3% of its operating income. U.S. Attorney Jill Westmoreland Rose, who oversaw the Carolinas settlement, wasn't available for an interview.

The continued use of higher-level medical codes "seems too prevalent to me to indicate that DOJ is a real credible threat," Brunt said.

This goes beyond providers: Health insurers, especially those that participate in Medicare Advantage, have been accused of inflating medical codes for members as well.

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Mulvaney: Trump "doesn't know who to believe" on Moore allegations

Screenshot of Mick Mulvaney on "Meet the Press" with Andrea Mitchell.

Mick Mulvaney, the director of the Office of Management and Budget, and Marc Short, White House director of legislative affairs, both attempted on Sunday to explain President Trump's silence on the accusations of child sexual abuse and other sexual misconduct against GOP Senate nominee Roy Moore:

  • Mulvaney said on NBC's "Meet the Press" that Trump "doesn't know who to believe," and "thinks that the voters of Alabama should decide."
  • Short said on ABC's "This Week" that "the president has expressed his concern" about the allegations against Moore: "As you noted, the president has not gone down to Alabama to campaign for Roy Moore since the primary concluded. We have serious concerns about the allegations that have been made, but we also believe that all of this info is out there for the people of Alabama."
Why it matters: The RNC has pulled its support from Moore and most high-ranking Republicans have repudiated him. Trump hasn't, but he has weighed in on the allegations against Democratic Sen. Al Franken.
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Zimbabwe dictator Mugabe to resign after 37 years in power

Zimbabweans sing and pray at a Christian peace and prayer rally Sunday in Harare. Photo: Ben Curtis / AP

Robert Mugabe, the 93-year-old dictator who led Zimbabwe for 37 years, will resign tonight, Reuters reports. He has already been removed as the leader of his party and early today was negotiating his resignation with military leaders, per the NY Times.

Mugabe was facing impeachment if he did not resign. Emmerson Mnangagwa, who was Zimbabwe's vice president until Mugabe precipitated the coup by placing his wife next in line for the presidency, appears poised to take control. He is known as a ruthless strongman.

Sunday Times of London lead story, "Fear is gone as the people turn on 'thief' Mugabe ... Zimbabweans unite against the tyrant who enslaved them," by Chief Foreign Correspondent Christina Lamb:

  • "It felt like a revolution. They came from all over the country and all walks of life. Young and old, opposition activists and party apparatchiks, white farmers and black war veterans, housewives and their maids."
  • "The slow-motion coup that began when the army arrested President Robert Mugabe on Wednesday was not yet over, but everyone knew that his own party was preparing to remove him."
  • Why it matters: "In 20 years of reporting on Zimbabwe I have never seen anything like it. This country has infuriated me like no other. The people are incredibly friendly but I have watched them vote for a ruling party that made their lives a nightmare — for fear of being beaten or their daughters being raped."
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Broadcom and Qualcomm move forward on other deals

Raimond Spekking via Wikimedia Commons

Broadcom hasn't yet gotten a "yes" on its takeover approach for Qualcomm, but both chipmakers are moving forward on other deals that could smooth their path to a mega-merger:

  • Broadcom on Friday closed its $5.5 billion purchase of networking switch maker Brocade, which was first announced last November.
  • Qualcomm is set to win "imminent" Japanese antitrust approval for its $38 billion takeover of Dutch chipmaker NXP Semiconductors, according to Reuters, with European approval expected by year-end.

Key move: Broadcom's recent decision to redomicile from Singapore to the U.S. seems to have gotten it over the final regulatory hurdles to buying California-based Brocade, as it had received antitrust approval in July but refiled in October with a U.S. body that oversees foreign investments. It also should aid in buying Qualcomm — although first it needs to make a higher offer.

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System failure on the NYC subway

A northbound #1 on Oct. 31. Photo: Richard Drew / AP

A front-page story from the NY Times' Brian Rosenthal, Emma Fitzsimmons and Michael LaForgia breaks down "How Politics and Bad Decisions Starved New York's Subways," starting with "a perennial lack of investment in tracks, trains and signals."

  • Wait, what? "[T]he actual movement of trains [relies] on a 1930s-era signal system with fraying, cloth-covered cables." (See the archaic equipment.)
  • "Daily ridership has nearly doubled in the past two decades to 5.7 million, but New York is the only major city in the world with fewer miles of track than it had during World War II."
  • "New York's subway now has the worst on-time performance of any major rapid transit system in the world ... Just 65 percent of weekday trains reach their destinations on time, the lowest rate since the transit crisis of the 1970s."
  • "Reporters for The Times reviewed thousands of pages of state and federal documents, including records that had not previously been made public; built databases to compare New York with other cities; and interviewed more than 300 people."
  • Let 'em out!

N.Y. Times Quote of the Day ... Roger Toussaint, former head of the MTA's main union, on what he sees as a focus on flashy subway projects instead of maintenance: "They haven't been spending money on the spine. They've been spending money on the limbs."

P.S. "Conductors on [New York] subway trains have been told to stop addressing passengers as 'ladies and gentlemen' when making announcements about delays, detours or other things, and instead use the gender-neutral terms 'passengers,' 'riders,' and 'everyone.'" (AP)

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Weinstein dominos, updated

Top: Harvey Weinstein, former Amazon Studios head Roy Price, director James Toback, New Orleans chef John Besh. Middle: fashion photographer Terry Richardson, New Republic contributing editor Leon Wieseltier, Mark Halperin, former Defy Media executive Andy Signore. Bottom: filmmaker Brett Ratner, Kevin Spacey, Jeremy Piven, Dustin Hoffman. (AP)

Some stories move so fast and far, we lose sight of the scale. So here's a freeze-frame on a defining story of our time: Men accused of sexual misconduct post-Weinstein, compiled by AP (click for details on each):

Entertainment:

  • Celebrity chef John Besh
  • Comedian Louis C.K.
  • Cinefamily executives Hadrian Belove and Shadie Elnashai
  • Actor Richard Dreyfuss: One woman alleges sexual harassment. He denies the allegation.
  • Director-producer Gary Goddard
  • Casting employee Andy Henry
  • Actor Dustin Hoffman: Accused by woman of sexual harassing when she was 17. He has apologized.
  • Actor Robert Knepper
  • Showrunner Andrew Kreisberg
  • Actor Jeremy Piven: Accused by three women of sexual misconduct. He denies all allegations.
  • Filmmaker Brett Ratner
  • Comedy festival organizer Gilbert Rozon
  • Producer Chris Savino
  • Actor Steven Seagal: Accused by two women of rape. He denies the allegations.
  • Actor Tom Sizemore: Accused of groping an 11-year-old actress in 2003. Utah prosecutors declined to file charges, citing witness and evidence problems. He denies the allegation.
  • Actor Kevin Spacey
  • Actor Jeffrey Tambor
  • Actor George Takei
  • Writer-director James Toback
  • "Mad Men" creator Matthew Weiner
  • Actor Ed Westwick

Media, publishing and business:

  • Billboard magazine executive Stephen Blackwell
  • Penguin Random House art director Giuseppe Castellano
  • New Republic publisher Hamilton Fish
  • Mark Halperin
  • Artforum publisher Knight Landesman
  • NPR news chief Michael Oreskes
  • Amazon executive Roy Price
  • Webster Public Relations CEO Kirt Webster
  • Rolling Stone publisher Jann Wenner: Accused by one man of sexual harassment. He says he did not intend to make the accuser uncomfortable.
  • New Republic editor Leon Wieseltier
  • NBC News booking exec Matt Zimmerman
Politics:
  • Sen. Al Franken (D-Minn.)
  • Senate candidate Roy Moore (R.-Ala.)
  • Florida Democratic Party Chairman Stephen Bittel: Accused of sexually inappropriate comments and behavior toward a number of women, Bittel resigned Friday.
  • Florida Democratic state Sen. Jeff Clemens resigned after a report that he had an extramarital affair with a lobbyist.
  • Florida Republican state Sen. Jack Latvala is being investigated by the Senate over allegations of harassment and groping. Latvala has denied the allegations.
  • Kentucky House Speaker Jeff Hoover
  • British Defense Secretary Michael Fallon
Sports:
  • International Olympic Committee member Alex Gilady
  • Former South African soccer association president Danny Jordaan
  • Former FIFA president Sepp Blatter
P.S. L.A. Times front page today: "[Brett] Ratner, [Russell] Simmons face new allegations of misconduct: Powerful Hollywood friends shared party lifestyle."
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Senate tax plan's winners and losers

CNBC screen on the floor of the New York Stock Exchange. Photo: Richard Drew / AP

Winners, per AP's Marcy Gordon, beginning with a big win for wealthy individuals and their heirs:
  • Corporations win all around, with a tax rate slashed from 35% to 20% in both bills — though they'd have to wait a year for it under the Senate measure.
  • U.S. oil companies with foreign operations would pay reduced taxes under the Senate bill on their income from sales of oil and natural gas abroad.
  • Beer, wine and liquor producers would reap tax reductions under the Senate measure.
  • Companies that provide management services like maintenance for aircraft.

Losers:

  • An estimated 13 million Americans could lose health insurance coverage under the Senate bill, which would repeal the "Obamacare" requirement that everyone in the U.S. have health insurance.
  • People living in high-tax states would be hit by repeal of federal deductions for state and local taxes under the Senate bill, and partial repeal under the House measure. That's the result of a compromise allowing the deduction of up to $10,000 in property taxes.
  • Many families making less than $30,000 a year would face tax increases starting in 2021 under the Senate bill, according to Congress' nonpartisan Joint Committee on Taxation. By 2027, families earning less than $75,000 would see their tax bills rise, while those making more would enjoy reductions.
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FBI report on "black identity extremists" raises civil rights fears

AP's Jon Elswick

"An FBI report on the rise of black 'extremists' is stirring fears of a return to practices used during the civil rights movement, when the bureau spied on activist groups," AP reports:

  • "The 12-page report, issued in August, says 'black identity extremists' are increasingly targeting law enforcement after police killings of black men ... It warned that such violence was likely to continue."
  • "Black leaders and activists were outraged after Foreign Policy revealed the existence of the report last month."
  • Why it matters: "The Congressional Black Caucus, in a letter to FBI Director Christopher Wray, said the report 'conflates black political activists with dangerous domestic terrorist organizations' and would further erode the frayed relationship between police and minority communities."
  • "A similar bulletin on white supremacists ... came out about the same time."
  • "The FBI noted it issued a similar bulletin warning of retaliatory violence by 'black separatist extremists' in March 2016, when the country had a black president, Barack Obama, and black attorney general, Loretta Lynch."
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Life under Kim Jong-un

In Pyongyang, a North Korean uses his smartphone in front of portraits of the late leaders Kim Il Sung (left) and Kim Jong Il. (2015 photo by AP's Wong Maye-E)

In six months of interviews in South Korea and Thailand, Anna Fifield, the Washington Post's Tokyo bureau chief, talked with more than 25 North Koreans from different walks of life who lived in Kim Jong-un's North Korea and managed to escape. What she found:

  • "They paint a picture of a once-communist state that has all but broken down, its state-directed economy at a standstill."
  • "Today, North Koreans are making their own way, earning money in an entrepreneurial and often illegal fashion."
  • The "Aha!" moment: "Market activity is exploding, and with that comes a flow of information, whether as chitchat from traders who cross into China or as soap operas loaded on USB sticks. And this leads many North Koreans to dream in a way they hadn't before."
Featured

Every industry identifying its creeps

Participants at the #MeToo March in the Hollywood section of Los Angeles. Photo: Damian Dovarganes / AP

There has been an outpouring of sexual misconduct allegations in recent weeks, spanning from politics to the music industry and the restaurant business. Every industry is scrambling to identify the men behaving badly and do something about it.

Why it matters: It's a clear picture of just how widespread this problem is. From the TED talk empire, to Harvey Weinstein in Hollywood, and the U.K. defense secretary, there is no one industry or field that isn't affected by sexual harassment.

Politics

Tech

Restaurants

Advertising

Hollywood

Hotels

  • The Huffington Post reported a study that revealed a majority of Chicago-area hospitality industry employees had been sexually harassed by a guest, had a guest touch or try to touch them, and more.

Science

  • Sexual harassment in the field of scientific research is prevalent, per Vox, when studies occur in remote workplaces (like Antarctica).

Music

  • Kirt Webster, major country music publicist, left his company after sexual assault allegations.

Media

  • Mark Halperin lost his book and HBO show deal, as well as contributing position with MSNBC, after five women accused him of harassment during his time at ABC.
  • NPR news chief Michael Oreskes resigned after two women accused him of sexual misconduct and harassment.
  • New Republic literary editor Leon Wieseltier lost financial backing on his coming magazine after being accused of sexual harassment.

Fashion

Sports