Medicare says that more than $34 billion is wasted each year through improper payments to hospitals and doctors.
But a major effort to reduce that number suffered a setback last week when officials delayed a program that would have held up payments to hospitals for 15 expensive procedures until auditors determine they are necessary.
The prepayment review program, which would have affected Florida and 10 other states, generated many "comments and suggestions" since it was announced in November, according to a statement from the Centers for Medicare and Medicaid Services. That prompted the agency to delay the three-year project, which had been scheduled to begin Jan. 1, until further notice.
Agency officials declined to comment further, but it was clear that many doctors were unhappy with the program, especially cardiologists, who would be most affected.
"It's one more inconvenience, one more set of rules and things physicians have to jump over to take care of patients," said Dr. Alberto Montalvo, a Bradenton cardiologist and immediate past president of the Florida chapter of the American College of Cardiology. "The people that will suffer will be patients."
Eleven of the 15 procedures involve cardiologists, including the implanting of cardiac defibrillators, pacemakers and stents. The other four involve joint replacements, spinal fusions and other back and neck procedures.
If and when the program goes into effect, Medicare payments to hospitals will be delayed pending a review of medical records.
Payments to doctors will not be delayed. But if Medicare auditors determine the claim is improper, it will be denied, the hospital will not get paid and the doctor will have to return any reimbursement related to the hospitalization. There's no financial impact to Medicare patients.
Medicare officials consider improper payments "a significant problem." The agency released a report last November that found more than 10 percent, or $34.3 billion, of fee-for-service payments in 2010 were improper. And it noted that such payments for inpatient hospital claims had increased significantly.
That includes the 15 procedures selected for the prepayment review project.
The fee-for-service system — where a provider is paid for each procedure or service — covers most of those in Medicare.
A smaller number are in managed care, or Medicare Advantage plans, which will not be affected.
Florida was selected for the program because it is one of 11 states with high levels of fraudulent claims or high claims volumes for short hospital stays. The other states are California, Michigan, Texas, New York, Louisiana, Illinois, Pennsylvania, Ohio, North Carolina and Missouri.
The Medicare report also found high rates of improper payments for expensive medical equipment such as power wheelchairs. The agency was set to implement a similar prepayment review program for those in seven states, including Florida. But officials decided last week to delay that as well.
Medicare said it would give 30 days notice before the programs begin.
To be sure, it's not as if 10 percent of Medicare fee-for-service claims are medically unnecessary. In many cases, payments in the Medicare report were deemed "improper" if there was insufficient documentation to support them.
Montalvo and Dr. Mahesh Amin, director of cardiology at Morton Plant Mease, believe only a small percentage fall into the fraudulent category.
Both cited an example of a Maryland doctor whose medical license was revoked after it was determined he had implanted hundreds of unneeded stents, which are small tubes used to open a blocked artery or blood vessel.
"Because of a few cases in the country, where abuses have been made, this is happening," Montalvo said.
Amin said in many cases, much of the required documentation for the procedures sits in the cardiologist's office, but isn't sent to the hospital before the procedure is done.
He said doing so would involve more staff time, both for the cardiologist and the hospital, without any added reimbursement.
Others have argued Medicare wasn't giving them enough time to implement the changes, or that officials weren't clear on what would be required.
Amin said BayCare, the nonprofit health system to which Morton Plant belongs, was set to comply with the new requirements on Jan. 1.
"Nobody's arguing the justification; it's just putting up more hoops," he added.
Montalvo, however, is concerned that the new requirements might actually hurt patients by delaying needed care until all the paperwork is received.
"Hospitals cannot admit a patient for a defibrillator or stent until the documentation is perfect," he said. "Doctors know how to take care of patients; we're not the best with paperwork."
Richard Martin can be reached at [email protected] or (813) 226-3322.