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Feds run extortion scam on doctors

Posted By Lee Hieb, M.D. On 02/25/2013 @ 1:10 pm In Diversions,Front Page,Health,Money,Politics,U.S. | No Comments

Dr. John Natale of Illinois graduated with honors from Loyola University, graduated medical school from Northwestern University School of Medicine and went on to complete eight years of arduous postgraduate study to become a highly trained thoracic and cardiovascular surgeon. For over 20 years he practiced his specialty at a hospital in Illinois, doing extremely complicated cases, including treating ruptured aortic aneurysms. Although these cases have greater than 10 percent intraoperative mortality in the recognized medical literature, Dr. Natale never lost a patient on the operating table.

Yet today, Dr. Natale is in a federal penitentiary – not for monetary fraud, not for damage to the patient, not for inappropriate conduct, but for writing an operative report that may not have reflected exactly what he did in the case. Or perhaps more accurately, for daring to defy Uncle Sam’s Medicare mobsters.

At first, the federal government, in the guise of the Medicare enforcement goons, charged Dr. Natale of falsifying an operative report with the intent to defraud Medicare by “upcoding” – charging for a bigger procedure than he actually performed.

He denied and fought the charges, and a jury acquitted him of any Medicare fraud. In fact, it came to light that Dr. Natale had probably cheated himself, not Medicare, by charging less than the allowed amount.

But picking one report and one case out of the thousands that the surgeon had performed, the prosecution convicted Dr. Natale of falsifying an operative record.

Now, I am not a vascular surgeon, so I do not pretend to be able to independently judge the truth or falsehood of the accusation. The problem involves the definition of “renal artery implantation.” Suffice it to say that vascular surgery experts were found to support both sides of the argument, so this could not have been completely clear cut. But at the of the day, Dr. Natale lingers in jail – convicted … of what, exactly? Since when does it become a federal crime to write a bad operative report – even a fallacious one?

In all likelihood, Dr. Natale did not intend to write a fallacious op note, because that is really not in a surgeon’s best interest. But no one is infallible, and bad dictations are made. I am a surgeon and have done thousands of cases, many involving complicated spinal implants and decompressions. I try to dictate my operative note immediately after the case, but sometimes that is not possible. I have been on call and been rushed into other emergencies before I could get a break to dictate. Sometimes I was up for nearly two days and just couldn’t stay awake anymore (after the adrenaline rush of surgery was over) to dictate a coherent report, so put it off till the next morning.

In the worst case scenario, but one which happens to every surgeon at some point, I dictated the note, and transcription lost it. This may be from my failing to push the right dictating button, or a clerical error, or a dictating system glitch. But whatever the reason, sometimes you will find yourself “redictating” a note months later, when the details are blurry.

But what can you do? Many hospitals will not note in the first line of the report, “This is a redictation of a previously dictated but lost operative note.”

It is possible that Dr. Natale is inept or generally bad at the paperwork of medicine – but if so, how did he manage to stay on one hospital staff for 20 years? He couldn’t have been too bad.

Even in the worst case scenario – that the doctor really did, for some unknown malicious purpose (and what could that be, since it was not financially beneficial?) purposefully falsify the operative report – how does that land you in federal prison? What exactly is the crime?

I suspect the crime actually is defying the Medicare enforcers.

As graphically documented in “The Criminalization of Medicine” by Ronald Libby, federal Medicare agents don’t like it when doctors fight the charges against them. To understand what is facing your physician, you need to understand the Mafia-like world of the Recovery Audit Contractor, or RAC, auditors for Medicare.

You may have heard that Medicare is out of money. One day, the big wigs at CMS – the Center for Medicare Services – decided to find where all the money had gone. Lo and behold, the money went to doctors and hospitals! So they set about a program for getting their money back: the waste fraud and abuse scheme.

For every office encounter and every procedure, doctors must choose a numerical code. Failure to choose the right code – and the right code can be very subjective – is by definition Medicare “fraud.” Nothing is ever deemed an honest mistake.

But the system is Orwellian. If I take out a tumor, code it benign and it proves on pathology to be malignant … voila! Medicare fraud.

If I take out a tumor and label it malignant but it proves benign … voila! Medicare fraud.

I have to consider “level of severity” of the problem in choosing my office code. As a spine surgeon, what I consider complex is not what a Family Practitioner looking at the spine might think complex – yet we use the same subjective grading system. And someone a thousand miles away determines, somehow, that my office visit was not coded correctly. How?

And if your procedure is new and has no code, you are instructed to choose the closest. Yet in some cases this “closest” choice was prosecuted – even landing the surgeon in jail.

The auditors come to a doctor’s office, look at a small sample of charts, decide he is “upcoding,” multiply the upcoded percentage by total number of charts and extrapolate back to his enrollment date in Medicare, which may have preceded enactment of the regulation. They then add triple damages and charge the doctor with some outrageous sum of money – sometimes over a million dollars. Of course he doesn’t have it, and malpractice insurance doesn’t cover it, so they cut him a deal.

“Doctor, we’ll drop your fine from a million to a cool 100K, but you have to sign this affidavit that you agree to keep silent as to everything that happened to you,” the federal Medicare extortionists explain. “Of course we will print in the news that you paid us for defrauding Medicare, because that is public record. But if you speak out, the full fee goes back into force.”

Ninety-five percent of doctors sign. The ones that don’t often are slammed with criminal charges and some go to jail. The RAC income is strictly a percentage of recouped money. And, adding to the whole wise guy flavor of the thing, if your office manager has a beef with you and turns you in, he or she can be paid 10 percent of the reclaimed money.

Every doctor in America runs scared. Just like Stalin using random terror to cower the average Russian, this is a very effective technique for controlling costs. Many doctors, to be safe, tend to undercode to avoid facing the RAC.

So what happened to poor Dr. Natale? He is serving his sentence – a sentence longer than most criminals serve after being convicted for grand larceny. At least thieves are usually given the option for restitution. Maybe the court couldn’t decide what restitution for Dr. Natale would be and didn’t want to be in the absurd position of requiring him – after all the time and federal money spent on prosecution to … what? – just redictate the op note?

To the detriment of our society, and to the practice of medicine, when the admittedly imperfect but everyday behavior of well meaning citizens is criminalized, we all become criminals. Will we start imprisoning electricians who make mistakes in their wiring diagrams or mislabel a fuse box? How about the dog breeder who misidentifies a breed of dog? Everyone, not just physicians should take note. And then, free Dr. Natale!


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