Elon Musk’s DOGE has a unique opportunity to standardize Medicare billing and fulfill the promise of nationwide Electronic Medical Records (EMR) health care information–sharing. Better yet, EMRs could become the vehicle Musk needs to root out fraudulent Medicare billing, saving the taxpayers billions and stabilizing Medicare’s future.
But first, a basic primer on how Medicare reimburses health care providers is needed. Here it is.
American society has entrusted physicians and health care workers (now collectively referred to as “providers”) with a sacred trust, and these providers are compensated through a “fee for service” system. To reduce costs and maximize profits, the government and private health care payers have attempted to manipulate this sacred trust and its compensation. This piece will focus on government Medicare reimbursement.
In the 1980s and early 1990s, Washington, D.C. think-tanks developed the concept of a Relative Value Unit (RVU). One RVU was assigned a dollar value (presently $33.28), and all health care services provided by physicians and other providers have been assigned Relative Values. A didactic example of how the system works is the calculation of a surgeon’s compensation for an appendectomy. The system has assigned 10.6 RVUs as the value for an appendectomy; therefore, a surgeon’s compensation is calculated by multiplying the assigned RVU value (10.6) by the value of 1 RVU (33.28), totaling $352.68. All “fee for service” compensation is calculated in this manner.
One of the most significant Medicare expenditures is the “fee for service” payment for provider-patient encounters, such as office visits. Medicare encounter billing codes were developed and named Evaluation and Management (E&M). For discussion purposes, complicated office encounter coding can be simplified without compromising the accuracy of the big concept. Theoretically, after a provider sees a patient, the office visit is assigned an E&M value between 1 and 5; however, in practice, only levels 3, 4, and 5 codes are used. A first-time level 3 visit has a Medicare-assigned RVU of 3.3; level 4 and 5 visits are assigned RVUs of 4.63 and 5.82, respectively.
Since the introduction of RVU-based compensation, the government has attempted various methods to reduce Medicare spending. Initially, it reduced the value of the RVU, but this strategy proved ineffective because providers worked harder and saw more patients, resulting in increased reimbursement. Government think-tanks became convinced that Medicare providers were “upcoding” — charging more than they should. Before the digital revolution, the government attempted to force providers to downcode by making documentation (paperwork) very difficult and then threatened medical providers with massive fines and imprisonment for upcoding. One example was that the qualifications for a level 4–5 office visit were so onerous that scared providers caved and billed only a level 3.
This strategy was initially successful, but everything changed with the advent of the Obama-era-mandated Electronic Medical Records (EMRs). Theoretically, all EMRs would be built on the same platform, and seamless sharing of medical data would be only a searchable, massive cloud database away. Due to EMR companies’ refusal to write programs that allow intra-EMR communication, this never occurred. However, an unintended consequence of EMRs was that they allowed providers to receive payment commensurate with their worth. It was no longer difficult to check all the overwhelming government-required boxes, because the EMR did it for you. Physicians could now legally upcode, and the government took notice.
Unhappy that their own rules were working against them, the government changed the rules and decided to institute a new billing parameter, “Medical Decision Making.” Supposedly, it measured the complexity of the patient, and only complex patient visits could be billed at the higher codes. The medical decision-making rules were unclear, and due to the sheer volume of Medicare provider claims, identifying and proving fraud was extremely challenging.
At about this time, the Washington, D.C. think-tanks decided they could not successfully manipulate the doctor-patient fee-for-service relationship, and the new mantra was that “fee for service” had to go.
An attempt was made to recycle the failed HMO model. The new name was an “Accountable Care Organization” (ACO). Large health care organizations were paid a set amount for each covered life, and if they used less in funds, the organizations pocketed the difference. Ostensibly, the idea was that medical providers would have an incentive to be more cost-effective. However, the government recognized that the only way to reduce costs was to ration health care, and the think-tanks knew that this approach was politically unfeasible. To avoid this political minefield, the government attempted to financially incentivize providers to ration care, knowing that any political blowback would be directed at the physicians. The medical providers and seniors quickly figured this out, and AOCs are out of favor.
The stymied D.C. think-tanks then resorted to the present-day price control model. Knowing that seniors would punish politicians if they cut providers to the point where they dropped Medicare patients, they allocated a set amount of money for Medicare provider payment, which is allowed to grow at approximately 1% per year. When inflation was low, the system was stable; however, after the Biden era’s 20% inflation, it is now severely strained.
Donald Trump has been elected president, and DOGE has been unleashed on the inefficient, bloated federal government. Donald Trump has promised not to cut Medicare benefits, but to create health care efficiency and root out fraud.
Enter Elon and his team of Musk Rats.
Imagine Elon Musk and the Musk Rats burrowing through all the EMR company roadblocks that have prevented providers from accessing patient medical records. Imagine them writing code that enables all Electronic Medical Records (EMRs) to communicate with one another and ultimately create a robust cloud-based database.
Currently, the government detects coding fraud by analyzing the providers’ electronic billing database to identify outliers. Outlier provider records are then requested, and government employees use a cumbersome process to screen the records to determine if they meet the billing coding requirements. If not, the provider is required to reimburse the government. In theory, this system appears sound, but it is rarely successful, it is impractical, and its determinations can be challenged. The government frequently loses these challenges.
Initially, if the Medicare billing database was queried and a provider was identified as an outlier, the new Musk Rat–created patient database could then be searched. Medical records could then be electronically examined by an A.I. coding program developed by the Musk Rats. An A.I. program that instantly determines whether the codes’ billing meets Medicare standards and adjusts charges accordingly. Once this system is developed, there will no longer be any need for physician coding. Office visits would be automatically transmitted to the federal government. Self-learning A.I. would determine the value, and compensation would be determined and sent to the provider instantly.
As often happens, the unintended consequences of the Musk Rats’ attempt to stop fraud and abuse would be much more profound. Physicians would finally be able to seamlessly query all EMRs and access a patient’s complete medical history. The massive dataset of Medicare patient records would be available for A.I. supercomputers to analyze and streamline the future of A.I.-directed patient care.
As the old saying goes, “se have the technology.” All that needs to happen is to let Elon and the Musk Rats have at it.
Image: Pkd2016 via Wikimedia Commons, CC BY-SA 2.0.
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