First of all hats off to the Happy Hospitalist for having the “guts” to discuss this matter and he’s not alone by any means.  This is happening all over the country.  Are we getting to the point to where we will need to have an attorney on a retainer available in order to get admitted to the hospital when we are sick and need care?  When you read his accounting it will certainly put that question in the back of your head.

The average person has no clue on how complicated “coding” is these days, in other words the codes that are entered for reimbursement and we are splitting hairs today with complicated formulas or algorithms to provide payment.  This sucks when a patient needs care and you have a doctor wanting to provide care. 

To further complicate the matter, the review committees appear to be in the dark as well.  In this situation you have a doctor giving good care, keeping hospital stays down or out of the picture when not required in his estimation, which it doesn’t take a brain surgeon to figure out that if a patient is not admitted, one saves money.  Now add to the situation that many hospitals are looking for more revenue as 55% of our US hospitals are operating in the red, see what I mean, it gets complicated.  The Texas Medical Association did a video last year that explains some of what happens.  You can watch the video below and read the entire post at the link below.

Hospital Admissions are Down – ER Doctors are Fired – Texas Medical Association

In his case here, we have an active discussion over what is observation (and how it is coded) versus being admitted as an inpatient (and how it is coded).  Reimbursement rates vary for each scenario, so it falls back to a committee, who is also confused on how all of this works.  Contracts change with insurance carriers too.  As Happy mentions, he and his coding people keep seeing claims denied, day in and day out.  We all know what happens when claims are denied, nobody gets paid and some of this rolls back to the patient, doctors, hospital to make it up, everybody loses.

In his case he mentions the 48 hour time level where this factor seems to be critical for reimbursement, so what do you do here, make sure everyone stays longer than 48 hours?  He asks the question about the 48 hours and a physician reviewer would take a look and evaluate the chart and would “overturn” the observation status (coding) he states, but look at what we have done here, now we have a process that takes time for another person to evaluate and hopefully they claims are paid and overturned, but this adds more time if nothing else to the processing area.

He brings up a good point that has been discussed before, why do hospitals get punished for providing good healthcare? In other words many hospitals have their own quality programs and it seems to hit head on with the algorithmic formulas presented by some insurers, long and short of this, more red tape.   Happy is practicing “hospital medicine” and is very aware of how to help the patient with medications when he discharges a patient and in another post references how he picks generics that he knows the patient will fill versus one that is too expensive and will go unfilled.  He also notes that some patients end up back at the hospital as they can’t afford those medications, so now we look at re-admission. 

Back on track here, this is a managed care Medicaid program which is pretty much the lowest reimbursement rate around in most states, I know it is here in California.  Also in the news this week United created some confusion in Connecticut with the assumption of the HealthNet patients they are acquiring.  It does make you wonder are they in fact maybe overwhelmed with their own data systems and maybe a little over analyzed?  What ever happened to the MIB (Medical Insurance Bureau)where carriers shared and were able to look at insurance provided for individuals so they would have some history? 

Connecticut State Medical Society Demands that United Healthcare/Ingenix Stop The Requests For Patient Records

The care you get may not come down to a code, but reimbursement sure does.  We talk about patient advocates being needed to get care, but again this looks like it has the settings for a legal interpretation just to get care at the hospital.  As a patient, your claims are “scored” and when things fall outside of the automated process the battles begin as then committees, advocates, etc. have to stop everything and get down to the details of every single item involved. image

How to Fight Algorithmically “Scored” Health Care Claim Denials – Line Up and Deliver Your Own Data

The doctors are just trying to get the patient the care they need while following procedures and standards and if a work around for coding somehow appears, then later on these can be subject to queries ran by risk management that could isolate such claims as having potential fraud characteristics as determined by the business intelligence rich algorithmic codes devises to detect “potential” fraud with setting the parameters to report on the desired areas they feel are out of compliance.  That’s the way SQL statement and queries work, have written a number of queries myself for analytical data in order to provide decision making numbers, all businesses do this, it is an everyday practice with business. 

Little Progress on Fighting Healthcare Fraud – Look At Who’s Getting the Anti-Fraud Contracts

We have so many legal suits going on over healthcare coverage and it is creating battles that should not be there.  There is also a role to be played here with the drug manufacturers too with making medications affordable.  I don’t have a problem with recovering R and D costs, but those margins are not what they have been in the past either so the high prices charged and out of consumer reach are not helping matters at all and yet we keep throwing millions of dollars at companies without having any idea if there will be a return on investment.  Big pharma has curtailed some of their own activity here with either shipping it over seas or using a VC funded biotech to develop and then when trials are looking good, they may come in and either invest or buy the company. 

Insurance Companies Under Attack with Lawsuits – Generated by Their Algorithms

In the meantime the algorithmic formulas of risk management prevail and it is putting doctors in a very uncomfortable position and creating reviews, utilization reviews to over ride, substantiate or what ever the case is to determine whether or not a claim gets paid.  Out of network claims for 8-9 years were both under paid for MDs and patients and those lawsuits keep piling up too. 

“Fair Database” to Replace Unfair Ingenix Data Base – Run by Non Profit

This is just one story out of many, but it is a prime example of what is happening at the point of service today and again how much more complicated can this get?  Are we on our way to further refinements where legal counsel will be required to be admitted?  Somebody has to sort all of this out and that is the way our court systems are set up, so what’s the next level here?  Will having a legal degree along with a medical degree become the next “normal” in order to practice medicine and take care of patients?  Of course I am saying this with a bit of sarcasm as the education costs for doctors would mount tremendously and with compensation the way it is today, most individuals would look for an alternative route for income that is not so complicated I think and add to the already mounting shortage of doctors we are starting to see. 

“Department of Algorithms – Do We Need One of These to Regulate Upcoming Laws?

I said this about 2 years ago, we just might need to start filing these algorithms digitally and have a Congress and their staff that can begin to comprehend what is happening here as technology and algorithmic formulas will continue to complicate every area of payment we have, including healthcare.  Ask any broker on Wall Street how they made the big bucks, “it’s all in the algos” and look at Goldman Sachs for the prime example of software algorithms at their best making profits.  BD

When I got off the phone, I had just one question floating in my mind:  Is United Health Care's Managed Medicaid contract and physician review process a scam?  I found myself with many unanswered questions.  Here's how that went down.

I recently admitted a patient with an illness requiring an acute inpatient hospitalization. According to my utilization review folks, my patient met both the intensity of services requirement AND the diagnosis requirements necessary to meet inpatient criteria.  You see, in  order to qualify for hospital admission  the patient must meet very specific criteria published in a thousand page book that defines what diagnosis must be present and what hospital services must be provided to qualify for an inpatient hospital stay.

You can't simply drop grandma off at the ER and demand admission because you're tired of taking care of her.  That's what a nursing home is for.  I am not a nursing home doctor. I am a hospital doctor.  A hospitalist.  That's why I put up a brick wall for social admits whenever it is humanly possible.  Because a hospital is not the appropriate place for a nursing home patient.  The nursing home is.

Physician Review Scam? My Experience With United Health Care's Managed Medicaid Physician Review Process


  1. You can't simply drop grandma off at the ER and demand admission because you're tired of taking care of her. That's what a nursing home is for. I am not a nursing home doctor. I am a hospital doctor. A hospitalist. That's why I put up a brick wall for social admits whenever it is humanly possible. Because a hospital is not the appropriate place for a nursing home patient. The nursing home is.



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