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White coats, white lies!

Misstating a medical condition so patients can claim health insurance

Healthcare fraud can be committed by anyone: policyholder, insurance company, or healthcare professional. A significant, though underestimated, fraud factor is the “white lie” told by physicians. Are doctors putting patients first or just working the system for their own benefit?


Medical fraud is a worldwide problem. According to the Centre for Counter Fraud Studies at the University of Portsmouth and UK accounting firm PKF, approximately 7.29% of global health care spending, around US$415 billion, is lost to fraud (and error) annually.

No country is exempt. Crimes range from simple wheelchair theft to highly organized crime networks that forge patient identities and create phantom companies to bill insurers. Jim Gee, director of Counter Fraud Services at PKF, calls healthcare fraud “the last great unreduced healthcare cost”.

In reality, physicians and nurses find themselves stuck between a rock and a hard place. When the Survey of Physicians and Nurses, conducted by the Kaiser Family Foundation and Harvard School of Public Health, polled some 1053 doctors and 768 nurses about their real-life experiences with health plans it found that two-thirds of physicians admitted that they had intervened with health plans on behalf of their patients.

Nearly half of the physicians and nurses said that they had exaggerated the severity of patients’ conditions so that the patient would obtain the coverage they felt was medically necessary.


Pressure to save costs

“This level of conflict and administrative haggling between doctors and plans can't be good for our health care system or for patients who are often caught in the middle,” states Drew Altman president of the Kaiser Family Foundation.

The pressure to curb medical spending has triggered a sea change in national health plans all around the world. In the US, nearly 90% of doctors reported that their patients have been denied coverage for certain health services, such as for prescription drugs, hospital stays, or diagnostic tests. The majority of the doctors reported that these denials had negative consequences for their patients, resulting in a decline in health.

Cost saving measures such as requiring patients to use only an approved network of hospitals and physicians, pharmacy restrictions, as well as payment systems that make healthcare providers financially accountable for their services, are a few examples of obstacles patients and doctors must navigate.


Grounds for lies

An article published in the JAMA, Journal of the American Medical Association reported the results of a survey of 1124 practicing physicians, with the goal of finding out how and why physicians manipulate reimbursement rules so that their patients can obtain coverage for services deemed medically necessary


Physician Manipulation of Reimbursement Rules for Patients:
Between a Rock and a Hard Place

(720m physicians questioned, response rate 64 %)

Physician Manipulation of Reimbursement Rules for Patients

Source: JAMA, The Journal of the American Medical Association


Three main tactics were the most often-cited strategies used by these physicians. One was exaggerating the severity of the disease condition, usually to avoid an early discharge from the hospital, which goes hand-in-hand with altering the formal diagnoses given on the patients’ bills. Many physicians also reported disease symptoms that were actually not present in order to help their patient obtain medical coverage. (See chart)

Gaming the system

A survey conducted by Victor Freeman and his colleagues of the Clinical Economics Research Unit, Georgetown University, Washington, uncovered an interesting angle of this ethical problem: The more serious the medical problem, the greater the percentage of physicians who sanctioned the use of deception to obtain medical coverage for their patient.
For example, 56-58% of physicians sanctioned lying to obtain authorization for coronary bypass surgery and arterial revascularization. The categories of intravenous pain medication and nutrition, screening mammography, and psychiatric referrals also had strong support, whereas few physicians sanctioned lying when there was no medical urgency, as for cosmetic rhinoplasty.

Why doctors tell lies

The central reason so many physicians condone deception is because physicians place their patients first. “Most physicians believed their primary professional responsibility was to practice as their patient's advocate,” state Freeman and his co-authors when discussing their findings. “[They] work within the rules and restrictions of third-party payers, so long as those rules do not significantly compromise the patient's interests.”

Over 25% of respondents patients were covered by Medicaid, the US federal program that insures medical coverage for the poor, suggesting that lack of adequate coverage was a driving factor causing physicians to lie. Indeed, physicians who routinely face a greater proportion of managed care patients appear to be more willing to lie on behalf of their patients.

In an article published in the Archives of Internal Medicine, Sidney Bogardus of Yale University School of Medicine states that “Deception may be a symptom of a flawed system, in which physicians are asked to implement financing policies that conflict with their primary obligation to the patient.

Too much bureaucracy

Another factor that drives doctors to lie is the complexity of the process in appealing a patient’s case to the health insurance company. “To control health care costs, many insurance companies have developed mechanisms to limit physicians' ability to order expensive tests or treatments,” says Peter Ubel of the University of Michigan Medical School and investigator at the Ann Arbor Veterans Administration Medical Center, in an interview with Mental Health. “If the [insurer] says 'no', doctors can appeal, but often, it is a long and burdensome process. So in some cases, physicians lie about their patient's condition.
The strategy of ‘gaming the system’ is officially condemned—lying is simply considered wrong. But in an article entitled “Why physicians ought to lie for their patients”, Nicolas Tavaglione of the University of Geneva’s Faculty of Medicine disagrees. “On the contrary, gaming may sometimes be a physician's duty. Gaming is sometimes justified, and may even be required in the name of beneficence.”

White-coated knights?

In the survey conducted by Freeman and his colleagues, the physicians who admitted to lying did not consider their behavior to be immoral. Indeed, the fear of getting caught was not a worry; 54% of survey respondents said they lied more frequently now compared to 5 years ago. The increasing obstacles thrown in the face of physicians, such as restrictive budgets, dwindling time for seeing patients, and lack of control over their patients’ well-being, widen the gap between healthcare providers and healthcare insurers.
For the time being, physicians themselves play a key role in curbing this problem. But health plans which circumvent doctors’ medical opinions in the interests of cost savings should carefully review their rules and procedures and cooperate with physicians to reduce the need for covert advocacy.

Exploring options for change

"It's important not to see this as an us-versus-them issue," says Peter Ubel. "We ought to see it as how to find the best way to give people appropriate care, while restraining the use of expensive tests that bring small benefits. The more it is seen as us-versus-them, the more doctors will begin playing by their own rules. If that happens, it is everyone's problem."



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