Increasing Medicare Advantage monitoring; Profit motive of the psychiatric bed; Rural ransomware

Welcome to the latest edition of Investigative Roundup, highlighting some of the best investigative healthcare reporting each week.

Increasing Medicare Advantage Control

Teresa Ross, longtime health plan director for Seattle Group Health, filed a sealed whistleblower lawsuit against the company years ago, alleging there were issues with how it billed Medicare, Bloomberg reported. She and other whistleblowers say insurers are scamming Medicare out of billions of dollars.

After years of investigation, the Justice Department took over Ross’s case last year, Bloomberg reported. Other whistleblowers have also come forward, accusing Kaiser Permanente, which Group Health merged with in 2017, and some of its competitors of inflating how sick members must get higher Medicare payments.

“The industry vehemently disputes the allegations and says the plans are being paid appropriately for the risk they take,” Bloomberg wrote. “But the contested billing practices at the heart of the Ross case have become critical to the health care industry and, as baby boomers retire, to America’s tax future.”

Nearly half of people on Medicare receive their benefits through Medicare Advantage or private plans like the one Ross worked for, which pay better for patients with more serious illnesses, Bloomberg reported. And the cumulative additional payments, over what traditional Medicare would have paid, will soon reach $100 billion, according to the Medicare Payment Advisory Commission.

Seniors have ‘flocked to the private version of Medicare’, Bloomberg wrote. And “insurance companies have built billion-dollar businesses propelled by this growth.”

But “the official examination is intensifying” Bloomberg added. In February, the Justice Department said it was pursuing health plans that tricked the system by “submitting unsupported diagnostic codes to make their patients look sicker than they actually were.” . Bloomberg reported. And the agency cited Ross’s case as an example.

The Kaiser Permanente branch in Washington state denied Ross’ allegations, Bloomberg reported. Without admitting liability, the health plan resolved the lawsuit in a $6.3 million settlement. The case against a provider the health plan had hired is still ongoing, as are a number of other whistleblower lawsuits against Kaiser Permanente and other insurers.

Psychiatric bed profit motive

While psychiatric facilities prioritize out-of-state children, children in South Carolina who need “immediate, 24-hour care” risk being stranded for days or weeks and to be sent hundreds of miles from home, Kaiser Health News reported.

The problem is not due to a shortage of beds, state agency officials said KHN. Rather, they said it was happening because many of South Carolina’s 518 licensed children’s beds are occupied by patients from other states.

“The reason boils down to facility bottom lines, which are determined by state reimbursement rates, since Medicaid often covers care for these patients,” KHN wrote.

South Carolina’s rate is about $330 a day, among the lowest in the country, said Deborah McKelvey, executive director of Windwood Family Services in rural Charleston County. KHN. Other states pay up to $800.

Seven other residential psychiatric treatment facilities for children in South Carolina operate as for-profit enterprises, KHN reported. Three of them are owned by a holding company of private equity firm Bain Capital. And some healthcare researchers continue to warn that private equity investments in the industry are prioritizing profits over patient care.

Although South Carolina Medicaid recently increased its reimbursement rate to $500 per child per day “in an effort to incentivize for-profit facilities to admit more children from the state,” said Robbie Kerr, director of SC Health and Social Services. to be enough, KHN reported.

“It is not uncommon for American children who need intensive psychiatric care to travel to another state for treatment,” KHN wrote. “Yet many psychologists and child protection experts suggest that children who receive this care closer to home will be more likely to succeed.”

Ransomware attacks hit rural hospitals

As ransomware groups become more opportunistic, rural hospitals and small healthcare facilities are facing “the reality of being locked down”, once considered a concern “only for large healthcare systems”. STAT reported.

Federal databases show providers, such as pediatric clinics, hearing centers, chiropractors and child abuse prevention organizations, are caught in attacks on the health care system, STAT reported.

“Such an attack can be devastating to a healthcare system of any size and frightening to anyone relying on its care,” STAT wrote. “But for smaller hospitals and practices, the costs — both to patients and to the bottom line — can be particularly high.”

The experts said STAT that rural and smaller providers are also less likely to be prepared to defend against a ransomware attack – and to resolve and recover from an attack – than larger urban institutions.

Small vendor vulnerabilities can be seen by attackers as a testing ground for exploits targeting the larger system, said Lee Kim, senior cybersecurity and privacy manager at the Healthcare Information and Management Systems Society. STAT. And if a rural provider is located near a military base or major technology hub, it may present an opportunity to steal non-civilian or high-profile patient information.

Ultimately, the fallout for rural and smaller providers can range from extreme costs and financial constraints ranging from low patient volume following an attack, to closure, to loss of patient confidence. and even legal action by patients, STAT reported.

“That kind of pressure is really a wake-up call for many organizations,” Kim said. STAT. “It can make or break an organization.”

  • Jennifer Henderson joined MedPage Today as a corporate and investigative writer in January 2021. She has covered New York healthcare, life sciences, and legal affairs, among other areas.

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