The Medicare Bureaucracy is a Frankenstein Monster That is Destroying American Medicine

by | Dec 22, 2000

The complex system for Medicare reimbursement for physicians is based on over 7,000 medical treatment codes. You know we’re in big trouble in medicine today when there’s a code not only for flatulence, but one for the guy standing downwind as well. I’m not making this up. If you look in the ICD-9 diagnosis coding […]

The complex system for Medicare reimbursement for physicians is based on over 7,000 medical treatment codes. You know we’re in big trouble in medicine today when there’s a code not only for flatulence, but one for the guy standing downwind as well.

I’m not making this up. If you look in the ICD-9 diagnosis coding book that Medicare requires physicians to use, you’ll find a code for almost everything that can happen to a person. There’s a code for injury due to legal intervention by gas, a code for injury that occurs while riding an animal that collides with another animal, a code for injury from being pecked by a bird, a code for injury from prolonged weightlessness, and a code for injury due to a fall from a spacecraft, flagpole, or commode.

There’s even a code for a person who has been sucked into a jet engine. Think about that. Why would you need a code for a person who has been sucked into a jet engine? Yes, there is a code for almost everything.

A serious crisis affects both Medicare patients and their physicians. It’s the crisis created by the Health Care Financing Administration and the Medicare bureaucracy. This abusive bureaucracy is a Frankenstein monster with an insatiable appetite for physician time. It obstructs, impedes, and interferes with every aspect of the practice of medicine today.

If you have any doubt about this, consider the fact that there are only about 17,000 pages of IRS regulations, whereas there are over 111,000 pages of Medicare regulations. As a solo physician in private practice, I now spend well over 50 percent of my time fighting this HCFA-Medicare bureaucracy.

The Monster.

In our office, we have Frankenstein’s son. We call him “Little Frank.” Little Frank stands 6 feet 10 inches tall and weighs 168 pounds. Little Frank consists of approximately 20,000 pages of correspondence that I have had with the HCFA-Medicare bureaucracy regarding problems created by the bureaucracy.

It scares me sometimes to think that I actually have more pages of correspondence with this HCFA-Medicare bureaucracy than there are IRS regulations. And this mass of correspondence keeps growing every week, as do the costs associated with maintaining it. Little Frank eats a lot of my time, money, and energy. The contradictory, illogical, and incomprehensible nature of Medicare’s regulations is truly mind-boggling.

Since 1965, the Health Care Financing Administration has been transformed into an ugly and uncontrollable beast that should more appropriately be called the Health Care Controlling Administration. Consider how far the Medicare program has strayed from the original intent as stated in Section 1801 of the act that created Medicare — the act which forbids any federal interference in the practice of medicine, which forbids “any federal officer or employee to exercise any supervision or control over the practice of medicine or the manner in which medical services are provided, or over the selection, tenure, or compensation of any officer or employee of any institution, agency, or person providing health services.”

So what does all of this burdensome bureaucracy have to do with patient care? The HCFA-Medicare industrial complex is forcing physicians to be “bureaucratically correct.” This has widespread and deleterious effects on patient care.

Most of these effects, however, remain well-hidden from the American public. Price controls and excessive regulation predictably lead to increased costs, decreased access, and the rationing of medical care, and HCFA has excelled in putting physicians in the unwanted role of being the ones who are essentially forced to carry out this rationing scheme. It is rationing by inconvenience, it is rationing by transferred costs, and it is rationing by bureaucratic schemes designed to deny payment to physicians for services rendered.

Getting What You Pay For.

Some people still don’t seem to get the simple concept that what isn’t paid for, they can’t get. For example, if you are a stroke victim and a Medicare patient and aren’t sure if you can go back home and live independently after discharge from the hospital, you can forget about getting good physical therapy, speech therapy, and occupational therapy in an inpatient rehabilitation facility. The bureaucracy has determined that such patients “aren’t worth it.”

If you are going to a nursing home following discharge from the hospital, HCFA considers you to be a second- or third-class citizen who will just have to make the best of whatever third-rate physical therapy the nursing home provides. What’s worse is that you can’t even pay for inpatient rehab out of your own pocket if you want to, because the HCFA bureaucracy has determined that it isn’t “medically necessary” and private contracting on a case-by-case basis is illegal.

Restricting Personal Freedom.

The HCFA-Medicare bureaucracy has a long history of preventing patients over the age of 65 from spending their own money on their own health care when and as they choose. Most elderly patients are unaware that they have lost this freedom and express great shock and disbelief when I tell them that this is the way the Medicare system today really operates.

The huge number of ever-changing Medicare regulations, including many that are either secret or well-concealed from practicing physicians, also clearly distracts physicians from patient care. When physicians must focus nearly all of their energy, efforts, and attention on making sure that they are bureaucratically correct and complying with every little bullet point in some idiotic quantitative guideline that HCFA has promulgated, it’s dangerously easy to get distracted from the purpose of why you are providing the service to the patient in the first place.

HCFA, in effect, has placed so many bureaucratic trees in front of practicing physicians that many physicians may truly no longer see the forest through the trees. This is a serious problem. Left untreated, it inevitably leads to a dangerous deterioration in the quality of medical care.

Stupid Rules.

The Medicare bureaucracy has also perverted the medical record. It really is no longer a clinically useful medical record — it’s a billing record. It has to be a billing record; otherwise, the physician will not be paid for his or her services.

The bureaucracy also forces physicians to think only in terms of black and white when making a medical diagnosis. The fact of the matter is, however, that medicine has many shades of gray. We don’t always know what the diagnosis is after the first encounter with the patient.

Because Medicare does not recognize “rule out” diagnoses, however, and requires physicians to code everything down to the fifth significant digit, it often forces physicians to enter erroneous diagnosis codes because the diagnosis isn’t yet known and the available codes for symptoms don’t fit the patient’s situation. The Medicare bureaucracy thus promotes medical inaccuracy by encouraging the coding of erroneous diagnoses.

The Medicare bureaucracy has also bastardized the CPT coding system physicians are required to use to code for the services that are provided to patients. HCFA agreed with the American Medical Association (AMA) back in 1983 to create a coding system containing separate codes for separate services; but now, under HCFA’s so-called correct coding initiative — correct according to HCFA — Medicare is combining separate and distinct services into a single code for payment purposes, thus cheating the physician out of proper payment for actual services provided.

HCFA calls this “bundling.” Physicians call it fraud. One must ask: What is the purpose of developing a procedure and services coding system with separate codes for separate services when HCFA simply ignores it? And what happens to these bundled services that are no longer reimbursed? It’s very simple: Patients don’t get them.

An Abuse of Power.

Last but not least, consider the current fraud and abuse situation. The masters of the old Soviet KGB had a slogan that the Medicare fraud and abuse cops seem to have fully embraced: “Show me the man, and I’ll show you his crime.” HCFA now operates a system that is so complex and has so many regulations that any physician in this country could be singled out at any time and found to be in violation of some Medicare rule, regulation, or guideline. Let me be specific.

  • In August 1999, Dr. Robert Gervais, a cataract surgeon practicing in Arizona, was invited to a public meeting on a HCFA project. Federal agents were hiding behind a one-way mirror at this public meeting to see which doctors were making negative comments about HCFA and the project. Dr. Gervais was critical. A little more than a month later, Dr. Gervais’ clinic was subjected to a “surprise” inspection, where federal authorities found “deficiencies” in his documentation. Dr. Gervais’ plans to remedy the “deficiencies” in the time HCFA required were deemed unacceptable, and his clinic was then “de-listed” by Medicare. Criticize the Medicare bureaucracy and its programs, and a doctor can be targeted for “hits” — a “hit” being defined as a bureaucratic action designed to kill the practice.

  • In another case, in February of 1999, 37 armed, flak-jacketed agents carried out a Medicare raid on East Tennessee Woods Memorial Hospital, a little 72-bed hospital in Eastern Tennessee. Can you imagine being a patient in that little hospital and seeing this invading army stomping into the hospital, trampling through sterile areas, forcing employees into a small room and holding them?

  • In yet another case, at Dr. Danny Westmoreland’s office in West Virginia, three armed federal agents invaded and held everyone at gunpoint, including the physician, his wife, patients, and children. Is this sort of thing necessary to conduct a Medicare investigation?

Lest we forget, this is the United States of America, not Communist China. Most people today have no idea that this is the way that the federal government is treating physicians. If you are a physician, you can count on the HCFA-Medicare bureaucracy to treat you as guilty until proven innocent. In this respect, even accused murderers and rapists are treated better than physicians; at least if you are accused of the crimes of murder or rape, you are entitled to the official presumption of being innocent until proven guilty.

But the Medicare bureaucracy goes even farther and uses this guilty-until-proven-innocent mode of operation to extract money from physicians, hospitals, and medical schools. Because HCFA officials consider a physician to be guilty until proven innocent, and because the cost of defending oneself from charges of health care fraud and abuse is at least a six-figure sum, HCFA frequently offers to settle for double damages in return for not pursuing treble damages and prison time for the physician.

When the mob does it, it’s called extortion. When HCFA does it, it’s called “Operation Restore Trust” or some other euphemistic name. And, remarkably, this is done on a “bounty” system whereby the recovering agency gets to keep a share of the loot.

Deliberate Downcoding.

Some physicians today are deliberately downcoding or undercoding for their services out of fear that they will be accused of fraud if they bill for any high-level service. The higher service codes almost guarantee a Medicare audit or request for further documentation to support the level of service billed. This undercoding, in turn, leads to further exposure for those physicians who accurately code higher-level services, because the latter now become “outliers,” and their outlier status will likely subject them to further costly encounters with the Medicare bureaucracy.

Even if a physician is merely accused of fraud, which the bureaucracy encourages patients to do, it frequently destroys the precious trust between patient and physician, even if the physician is ultimately cleared of committing any crime. When the bureaucracy destroys the trust that patients place in their physicians, it is destroying the very heart of medical practice in America.

The views expressed above represent those of the author and do not necessarily represent the views of the editors and publishers of Capitalism Magazine. Capitalism Magazine sometimes publishes articles we disagree with because we think the article provides information, or a contrasting point of view, that may be of value to our readers.

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