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Bad Algorithms in Healthcare Payment Systems and Risk Assessments–Did the Hospital Bill Fraudulently or Were They Sold For

Posted Oct 19 2011 2:54pm

We see so many of these stories in the news today to where hospital, doctors and so on get caught in some type of an audit and there are those who do commit fraud with billing and “gaming” the system, and this is not about those folks, but rather how many are using 3rd parties who “sell” the fact that “we can save you money”.  Earlier this year one case made the news with Blue Cross and the 3rd party they used for stress tests.  Numbers don’t lie but people do.  This company promised 25 to 30% savings….so where’s the line between finding legit errors that could be saving money and potentially “gaming” the system? 

It was the algorithm that denied stress tests, not a human touching this, all analytical.   See how the algorithms can deny care? 

In this case a nuclear stress test was ordered by his doctor and it was denied by Blue Cross 3 times and the doctors had to go to work and interesting how this video shows a web conversation with him and his doctor too.  After 3 times the doctor sent the patient to the hospital where a big blockage was found and if he had not received treatment he would dead said the doctor at the hospital.  He had an emergency quadruple bypass.

Another story in the news of late, another 3rd party who made one big mistake and now Stanford is on the hook for this.  What are these 3rd parties really doing one might ask?  The competition is fierce today out there with saving money for sure and marketing is coming out everyone’s ears. 

As we have automated coding and billing input, it’s not always a doctor doing the input but rather the software doing the work and that is set up by a programmer with software and algorithms.  We have seen big hospitals such as Mayo, and others get hit with this and we all know that big institutions and all their hard word for good clinical care does not match with “gaming” a system but there’s a lot of data systems that need to come together for all of this. 

Why Is Almost Everyone In Healthcare Marketing Their “Ass” Off

So what are some of these consultants selling?  We have some very mis-matched analytics creeping around out there and the FICO is one of the over marketed and frankly put out there to make money as credit scores and medication adherence  are not related when you bring it down to an individual basis.  If you want to crunch numbers and put those out for stats, different story, but this is where the marketing comes in a skews analytics with over selling and mis matching data to make a image buck. 

FICO Analytics Press Release Marketing Credit Scoring Algorithms to Predict Medication Adherence–Update (Opinion)

So in summary when you look at all these news stories today, is it really the hospitals and doctors making the errors or is there a lot of misguidance offered by “consultants” who are marketing to sell their algorithms?  Wait until ICD10 kicks in, as there are analytics folks just waiting in the reigns to sell new algorithms to help advise on that level, as more codes and specifics mean more room to sell more software to help doctors and hospitals.  That’s the way the software game works with aggregation and selling value to add another layer on top of what has already been purchased and it just keeps rolling.  The more complicated the system gets, the more code it requires to sort it out.  We have a pretty public case here in California…was this be design or was it done via software? 

Someone had to do it so was it manually instructed to follow these guidelines on billing or did the algorithm do it?  Here’s a case where the City of Buffalo was sleeping while their algorithm continued to pay insurance premiums on dead employees.

City of Buffalo Has Paid Over $2 Million to Provide Health Insurance for Hundreds of Dead People-Some as Many as 4 Years

I found the online doctor referral services didn’t do much on updating their algorithms or data base references a couple years ago, result, flawed data.

HealthGrades And Other MD Rating and Referral Sites List “Dead Doctors” on Their MD Information Pages And Even Include the Insurance Plans the “Dead Doctors” Honor

We do a lot of work to make sure that medical record software is certified and works as it should but when it comes to the payer analytics and the 3rd parties with their marketing on steroids, nobody pays attention except for when some bad algorithms are caught in an audit. 

Yet in the news, the poor consumer is always depicted as the “bad guy” who doesn’t keep up, well who can keep up with all of this?  I think we might be getting around to the fact that some certification processes like we do for medical records for the financial side just might be in order soon as I hear that from the geeks on the financial side saying the same thing with asking for ISO certification.  Straight math doesn’t cut it anymore for being 100% proof with finding accuracy, its what it is sadly. 

“Numbers Don’t Lie, But People Do”–Radio Interview from Charles Siefe–Journalists Take Note, He Addresses How Marketing And Bogus Statistics Are Sources of Problems That Mislead the Public & Government

Furthermore, this is a big underlying factor as to why the protesters are out in force today.  If you have not read about “The Attack of the Killer Algorithms” and image Bad Science, read up and listen to the audios and videos included at the posts below and see what you think after hearing some terminology and explanations you maybe have not heard before from some real experts at a higher level than myself.   

Occupying Wall Street–It’s All About the “Attack of the Killer Algorithms”–The Unfair and Marketing Exploit of Ethics Using Math–This Could be a Subject for Michael Moore to Explore and Document In a Movie
Bad Science and Bad Analytics That Misleads–TED Video Takes on Advertising on Steroids and Danger of Mis-Matched Analytics And Distortion of Clinical Trials (Video)

It’s time to find out what’s behind the math as it is getting more complex every day and if we don’t start somewhere, well, a path of insanity will follow as marketing and the chase for the dollars continues.  BD 


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