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Cashing in on the ER

60 Minutes chronicles disturbing physician admissions about admissions

You have probably heard the saying: “You know it is going to be a bad day at the office when the camera crew from 60 Minutes pulls into the parking lot ahead of you.” And the management of any organization might rightly worry that they could be the target of a “hatchet job” at the hands of one of the long-serving CBS correspondents.

But what about a case when the TV report is more like an accurate scalpel?

In December 2012 a 60 Minutes exposé cut deep into a cancer that has grown on the body of the US health care system itself. The executives at Health Management Associates (HMA - a corporation that owns a large number of hospitals) must have felt the pain of that incision without the benefit of anesthesia.

Most informed Americans have heard that “Medicare fraud” is an ongoing problem. For the uninformed, it might bring back memories of hearing  the old stories about Department of Defense spending, with contracted vendors routinely selling the government items like small screwdrivers for $80 each. It is easy to assume that the worst of the health care fraud involves the cost of medical equipment and supplies. However, it is much more pernicious when it is found in the medical decision-making process itself.

The 60 Minutes story interviewed physicians working for HMA who said they were pressured to admit patients presenting themselves to the emergency room. The report indicated that regardless of the patients’ actual medical needs, doctors were being pushed into converting ER visits into more profitable inpatient stays.

At first blush, it might seem prudent to let your beloved grandma or grandpa stay a few days in a medical center “just in case.” Unfortunately, hospitals are dangerous places even for the young and healthy. And in the case of HMA, the story said physicians were being rated on how often they captured the Medicare dollars that can be plucked out of the older patients’ wallets at the time of admission. Once ensconced in a bed, the elderly person has an elevated risk of compression fractures, infections, complications, delirium and “deconditioning of adult daily living skills.” Any hospital-induced decline in function can dictate that patients will not be discharged back into their homes.

The 60 Minutes episode failed to show that this is where more than an insult can be added to a medical injury. How the physician “coded” the patient placed in the bed (for observation or an authorized inpatient stay) dictates whether or not Medicare nursing home benefits will be paid if the patient cannot safely return home. If the elder did not have a documented and properly coded three-day stay, their loved ones will be at a loss to understand why a nursing home is only willing to take them in as a private pay patient (pass the hat, because the family now has to come up with thousands of dollars each week).

There have been efforts to rectify this problem in Washington through a policy overhaul that would credit all the time the patient spends at the hospital toward skilled nursing coverage. Big shock: amid partisan infighting, no progress has been made. Maybe when the relatives of senators and representatives from both parties get drawn into this dangerous and unaffordable racket, we will see a return to the true caring for our elders that was intended in the creation of Medicare.

Meanwhile, it seems funny that the funds are called “entitlements.”  The only people who seem to feel fully entitled to profit from their existence are the employees who take big annual bonuses at companies like Health Management Associates. These executives had better save up those funds in case they ever have to pay out of pocket for their own or a loved one’s care as a consequence of a physician getting pushed into providing and documenting inappropriate treatments.


Helen Meldrum is associate professor, Natural and Applied Sciences at Bentley University.


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