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Doctoring the Doctor Bills

Lawmakers learned how physicians are coached to overcharge insurers and the government. As CBS's Sharyl Attkisson reports, Congress has caught healthcare consultants coaching physicians in ways to bilk the government and health insurance plans out of billions of dollars.

A 1997 estimate shows that healthcare industry fraud was $54 billion nationwide: $20 billion in fraud against private insurers and $34 billion in fraud against Medicare and Medicaid. In 2000, government estimates show $11.9 billion in improper payments made for Medicare claims.

It took a California physician, Dr. Kathryn Locatell, to blow the lid on seminars teaching doctors how to lie and cheat on insurance claims to make more money. One healthcare consultant promised her great rewards.

"He said that I would soon be able to afford that Lexis, or that Kincaid painting I had my eyes on," says Locatell, a geriatric physician.

Locatell alerted Congress and then agreed to go undercover to help federal investigators. What they discovered and secretly recorded were healthcare consultants advising doctors on the finer points of "gaming the system."

One consultant advised, "limit patients with Medicare and other less-desirable insurance."

According to audio-tape of a healthcare consultant at a seminar, "We don't want them taking the best appointment slots. So they get scheduled only 10:00 to 11:30 in the morning . . . We want the best appointment slots to go to the best payers."

Unnecessary visits were also advised: "Doctors can always schedule two office visits even if they've already determined a patient is perfectly healthy."

The taped consultant explained, "The doctor then spends quality time with the patient and talks about lifestyle, all these other goodies, and, you know, tosses a stethoscope on, and all these other things that make a patient feel better."

Making routine visits appear more complicated was another recommendation. Doctors were even advised to take advantage of older patients with brain impairments--by making routine visits appear more complicated to justify higher billing.

"During the visit you want to ask them other questions that they can't answer due to Alzheimer's senile dementia, organic brain syndrome. So then, therefore, you end up spending a lot longer with the patient," the audiotaped consultant advises.

Congress said most consultants are honest, but it blamed the unscrupulous ones for contributing to the $12 billion in fraud against Medicare just last year.

"This behavior is unethical, it can be illegal and it's certainly intolerable!" says Senator Charles Grassley (Republican from Iowa).

The company that put on the seminars in question now faces possible criminal prosecution. And the federal government has issued an alert to doctors urging them to be careful when choosing health care consultants.
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