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Medicare overpays billions for office visits, patient evaluations
The findings by the inspector general of the US Department of Health and Human Services complement a recent ProPublica review that found many doctors bill for services very differently than their peers 
 
Medicare spent $6.7 billion too much for office visits and other patient evaluations in 2010, according to a new report from the inspector general of the U.S. Department of Health and Human Services.
 
But in its reply to the findings, the Centers for Medicare and Medicaid Services, which runs Medicare, said it doesn't plan to review the billings of doctors who almost always charge for the most-expensive visits because it isn't cost effective to do so.
The inspector general's report, released today, estimates that overpayments account for 21 percent of the $32.3 billion spent on evaluation and management (E&M) services in 2010. The E&M category includes office visits, emergency room assessments and inpatient hospital evaluations.
 
This is the second time that the inspector general has singled out this area for more scrutiny. In 2012, the watchdog said physicians had increasingly billed Medicare for more intense—and more expensive—office visits over time. But that didn't prove the claims were improper.
 
"The natural question that comes out of this is: Are these physicians billing appropriately?" said Dwayne Grant, regional inspector general for evaluation and inspections in the Atlanta region, who oversaw the new report. "We don't want to pay them too much but we don't want to pay them too little either."
 
For this review, the inspector general gathered the medical records associated with 657 Medicare claims and asked professional coders to see whether the records justified the rates charged.
 
Overall, more than half of the claims were billed at the wrong rate or lacked documentation to justify the service. Sometimes physicians billed for a lower-cost service than the one they delivered, but more often they billed for a higher-cost one. The inspector general extrapolated from its sample to estimate the amount Medicare overpaid on all 2010 E&M claims.
 
"We have to do a better job of curbing improper payments and protecting taxpayer dollars," Sen. Bill Nelson (D-Florida), chairman of the U.S. Senate Special Committee on Aging, said in a statement.
 
The inspector general's findings complement a recent review by ProPublica of data recently released by Medicare on payments to individual health professionals for services in its Part B program. We found that in 2012, more than 1,800 doctors and other health professionals almost exclusively billed Medicare for the most complicated and expensive office visits for their established patients.
 
Office visits are the most common services provided in the program.
 
While most providers had a tiny percentage of visits for which they charged the highest rate, known as level 5, more than 1,200 billed exclusively at that level. Another 600 did it more than 90 percent of the time. About 20,000 health professionals billed only at the top two levels, 4 and 5.
 
Experts we consulted said that these billing patterns were highly implausible and could indicate fraud. Some doctors, however, said that their patients were sicker than those of their peers and required more time and attention.
 
ProPublica also launched a new tool called Treatment Tracker that lets users look up their doctors and see how they compare to peers on office visits and other measures.
In its report, the inspector general's office recommended that CMS educate doctors about proper billing practices. It also suggested that Medicare pursue doctors who consistently billed for higher-level services than they actually delivered, a practice known as upcoding.
 
While CMS agreed with the need for education, it disagreed with the recommendation to review the physicians' billings. It said one of its contractors recently reviewed 5,200 medical claims of high-coding physicians and the process cost more money than it caught in overpayments.
 
CMS said a second phase of the review—of 13,500 claims—was nearing completion. "Based on the results of this effort, CMS will reassess the effectiveness of reviewing claims for high-coding physicians" versus other efforts, such as sending these doctors reports that compare their billings to their peers.
 
Grant, of the inspector general's Atlanta office, said that while the individual E&M services do not cost much, they add up -- and that if CMS declares that it won't review outliers, it could send the wrong message.
 
"The challenge that CMS is trying to figure out is what is the best way to get at this," Grant said. "We see the advantage of continuing to look at these high billers. Not only are they billing high now; it could have an impact on future billings...This is not just free rein to bill whatever you want."
 
Courtesy: ProPublica.org

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NY Attorney General retreats after pressing Red Cross on post-Sandy spending
The office of Attorney General Eric Schneiderman sought details on how the charity spent donations after the super-storm, but the information was never released
 
Last month we explored the role of the American Red Cross after Hurricane Sandy and the lack of transparency in how the charity spent more than $300 million raised after the storm. Experts criticized the group for not offering a detailed accounting of its post-Sandy efforts.
 
It turns out New York’s attorney general had similar questions for the prominent charity, according to a previously unpublished letter the office sent to the Red Cross.
 
The office of Attorney General Eric Schneiderman last year asked the Red Cross for much of the same detailed financial information that we sought from the group. But no such information was released.
 
And when the attorney general’s office later came to an agreement with the group about its reporting of financial information after disasters, there were no requirements for anything beyond summary data. That means that it will continue to be difficult to assess the response of the Red Cross to future disasters.
 
The attorney general's office requested information from the Red Cross starting soon after Sandy in late 2012 and managed to get some answers.
 
But in a June 2013 letter, which we obtained through a Freedom of Information Law request, the head of the attorney general’s charities bureau expressed “continuing concerns about fundraising and relief efforts conducted by the American Red Cross in response to Hurricane Sandy.”
 
The letter asked the Red Cross to:
detail its post-Sandy spending including "how much was spent on personnel, supplies, transportation, fuel, rental fees, professional fees, administrative costs, and any other relevant categories." 
separate figures it commonly combines as "spent or committed," a practice that makes it impossible to determine how much aid has been distributed versus merely promised.
 
No such details have been released. The Red Cross didn’t provide the breakdowns when we asked for them either. (Neither the Red Cross nor Attorney General’s office would say whether the numbers were provided privately.) 
 
Several months later, in October, Schneiderman announced an agreement with the Red Cross covering, among other things, how the group will release information after future disasters. But the deal does not specify how much detail the Red Cross must provide in its post-disaster financial reports. Instead, it simply requires the Red Cross to regularly report summary financial information.
 
“The central question that drove the attorney general’s correspondence with the Red Cross -- what’s going on with the Sandy money? -- was thrown out the window in the final agreement,” said Doug White, a nonprofit expert who directs the fundraising management program at Columbia University.
 
The Office of the Attorney General did not respond to requests for comment. When we originally reported on the lack of transparency, the Red Cross it issues "regular reports about our spending and programs for disasters such as Sandy."
 
They declined to comment this time. 
 
While the agreement doesn’t require the Red Cross to release much in terms of financial details, the organization did agree to stop referencing a particular disaster in fundraising appeals once it determines it has raised enough money to meet the need.
 
Courtesy: ProPublica.org

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IRS delays new rules for Dark Money groups
The agency has pushed back indefinitely a hearing on new regulations for social welfare nonprofits that spend money on politics
 
After intense criticism from both ends of the political spectrum, the Internal Revenue Service has delayed indefinitely proposed rules that would have imposed new limits on social welfare nonprofits, which have pumped hundreds of millions of dollars from anonymous donors into recent elections.
 
The agency said yesterday it would postpone a hearing on the proposal it released in November defining more clearly what constitutes political activity for such groups, and would revise the plan to reflect some of the more than 150,000 comments it triggered.
Officials put no timeline on the process, disappointing those who had hoped the new regulations might kick in before this year's mid-term elections.
 
"I think it's unfortunate that new rules will be delayed even further and that we're going through another election cycle" without them, said Paul S. Ryan, senior counsel with the Campaign Legal Center.
 
Others called the delay a prudent step that would give the IRS an opportunity to get a crucial change right.
 
"They're not going to put out some slapdash rule just to check it off their list," said John Pomeranz, a Washington lawyer who works with nonprofits that spend money on politics. He doesn’t expect the agency to finish the rules any time soon. “I think we’ll be lucky if they’re in place for the 2016 election.”
 
Social welfare nonprofits have poured money into politics since the Supreme Court's Citizens United decision in 2010, which allowed corporations, unions and nonprofits to spend unlimited money on elections.
 
Social welfare nonprofits spent more than $256 million in the 2012 cycle alone, according to the Center for Responsive Politics. Campaign finance watchdogs have viewed their rise with concern, fearing the influence of so-called "dark" money from secret donors, and had called for more oversight from the IRS.
 
Under IRS regulations, the groups can spend some of their resources on politics, but must devote themselves mostly to social welfare to keep their nonprofit status. But the rules defining what is and isn't politics are murky.
 
Late last year, the IRS moved to clarify the issue, but its proposal came under fire from both the left and the right.
 
Conservatives complained that the rules would stifle political speech. The American Civil Liberties Union chafed at a provision in the proposed rules that would prevent nonprofits from backing ads that even mentioned politicians in the two months before a general election.
 
"We have no doubt that the Service is acting with the best of intentions, but the proposed rule threatens to discourage or sterilize an enormous amount of political discourse in America," the ACLU said in its written response to the proposal.
 
The plan was also criticized for impeding nonpartisan election work such as voter registration drives and get-out-the-vote efforts.
 
The IRS, still facing fallout from accusations that it singled out the applications of conservative nonprofits for special scrutiny in the run-up to the 2012 election, decided it would make revisions.
 
"Given the diversity of views expressed and the volume of substantive input, we have concluded that it would be more efficient and useful to hold a public hearing after we publish the revised proposed regulation," the agency said in statement.
 
Courtesy: ProPublica.org

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