Do health care’s perverse incentives lure MDs into deliberate misdiagnosis for profit?

beaumonthospital-300x115When doctors become medical outliers, shouldn’t hospitals, colleagues, insurers, and the rest of us ask how and why an individual practitioner diverges so much from the way others provide care?

Olga Khazan details for the Atlantic magazine the disturbing charges involving Yasser Awaad, a pediatric neurologist at a hospital in Dearborn, Mich. As she describes him, for a decade he racked up hundreds of cases in which he is accused by patients of “intentionally misreading their EEGs and misdiagnosing them with epilepsy in childhood, all to increase his pay.” Khazan says his case “shines a light on the grim world of health-care fraud—specifically, the growing number of doctors who are accused of performing unnecessary procedures, sometimes for their own personal gain.”

In the malpractice cases that are unfolding against him, Awaad’s pay has become a central issue, with evidence showing his hospital contract rewarded him for boosting the number of screenings he ordered and diagnoses he made. Jurors have been told that Awaad, whose salary increased from 1997 to 2007 from $185,000 annually to $300,000, “turned that EEG machine into an ATM.” He earned bonuses exceeding $200,000, if he hit billing targets.

For his patients, his approach was a problem: He put many on powerful anti-seizure drugs, treatments for epilepsy for which they had been misdiagnosed. The drugs had tough side-effects. Colleagues said they complained about him, but the hospital turned a deaf ear. Administrators turned away or ignored complaints from other doctors that patients that Awaad found to have epilepsy did not and that he was retesting patients for the condition with unacceptable frequency.

A disturbing treatment trend?

Differing opinions are an accepted and important part of medical care, Khazan reported. But she gives what she calls a “snapshot” of incidences in which money and not patients’ best interests has driven their harmful care:

“In 2013, nearly 400 people sued a hospital and doctor in London, Kentucky, for needlessly performing heart procedures to “unjustly enrich themselves,” as the Courier-Journal in Louisville reported. Last year, a Texas doctor was accused of “falsely diagnosing patients with various degenerative diseases including rheumatoid arthritis,” according to CNN. And a different Kentucky doctor was sentenced to 60 months in federal prison for, among other things, implanting medically unnecessary stents in his patients.”

(By the way, one of the doctors in the Kentucky case also ended up in prison for improper Medicare billing.)

Most doctors don’t succumb to perverse incentives in the health care system, Khazan emphasized. But she makes these excellent and tough points, also quoting Malcolm Sparrow, a Harvard professor of public management:

“The most devious doctors, who will harm their patients to line their pockets, make headlines. But in a way, even honest doctors are incentivized to err on the side of excessive care. Most doctors work on a fee-for-service basis, meaning the more they bill insurance plans, the more they earn. Some states and hospitals are trying to avoid this situation by experimenting with paying doctors a fixed amount. But that, Sparrow said, creates the opposite problem: It means doctors are incentivized to do less. Ideally, in his view, there wouldn’t be incentives either way. ‘I don’t want a doctor who is richer for treating me more or richer for treating me less,’ he said. ‘I want a doctor who is on a salary.’ “

In my practice, I see not only the harms that patients suffer while seeking medical services, but also their struggles to access and afford safe, efficient, and excellent medical care. This has become an ordeal because of the skyrocketing cost, complexity, and uncertainty of medical treatments and prescription medications, too many of which prove to be dangerous drugs.

Over testing, over screening, and over diagnoses

As health officials, patient advocates, regulators, and politicians try to curb medical services’ soaring costs, they’re increasingly focused on an important gateway: Over-screening, over-testing, and over-diagnoses that add an estimated $200 billion in unnecessary expenses to our care, with over-treatment costing 30,000 lives a year of older (Medicare) patients alone.

Look at your own bills and see how a routine, relatively inexpensive doctor visit can blow up with added testing costs. These might include tests for cholesterol (costing as much as $1,000), Vitamin D deficiency ($50 or so), diabetes (blood sugar $20), breast (mammograms, often covered by insurance but $20 to $60), or prostate cancer (PSA test $40).

To be sure, appropriate, timely medical tests and screens can be life-changing, even lifesaving. But experts — including Uncle Sam, the nonpartisan and independent Consumers Union, and more than two dozen leading groups representing an array of medical specialists — warn that American doctors and hospitals reflexively order too many tests whose potential harms outweigh their benefits.

Some of this may be blamed on ceaseless falsehoods about medical malpractice lawsuits and the practice of “defensive medicine.” But it also puts patients at increased risk, exposing them to a health system in which medical errors claim the lives of roughly 685 Americans per day — more people than die of respiratory disease, accidents, stroke and Alzheimer’s. That estimate comes from a team of researchers led by a professor of surgery at Johns Hopkins. It means medical errors rank as the third leading cause of death in the U.S., behind only heart disease and cancer.

They haven’t yet shown the promise that their advocates hoped. But electronic health records were envisioned as a way to track and prevent extreme and excessive medical testing, prescribing, and outlier treatments. Despite the billions of dollars spent on them by taxpayers and hospitals, they, alas, have been mired in technological flaws, including a lack of inter-operability (the ability of one proprietary system to work with another) and the putting of high demands on doctors and specialists to input information as if they were less trained medical clerks.

The allure of pricey gadgetry

But, speaking of perverse incentives in the health system: With so many hospitals raking in big money (Note: a major insurer estimates that hospital costs grew 19% between 2013 and 2017, even as their inpatient figures declined) and at the same time being not-for-profit institutions, too many of them have plowed revenues into shiny buildings and the latest pricey gadgetry — like surgical robots and diagnostic imaging devices.

The Trump Administration, as the Kaiser Health News Service reported, has delayed the implementation of a law Congress passed to reduce unnecessary MRIs, CT scans and other expensive diagnostic imaging tests. Doctors claimed the law interfered with their medical practice. So, critics say, “Medicare is continuing to pay for millions of unnecessary exams, and patients are, in the case of CT scans, being subjected to radiation for no medical benefit,” the nonprofit health and medical news service reported.

Now an electroencephalogram or EEG isn’t the most expensive test around, running anywhere from a few hundred to as much as $3,000, if extensive monitoring is required. So, jurors who found Awaad guilty of malpractice involving a patient and ordered him to pay her $2.8 million, well, if this was his chief means of income boosting, he ran a lot of these tests and made a lot of diagnoses based on them. The hospital that paid him for his practice of medicine has merged, and Beaumont, the successor institution (shown above), says it plans to appeal the Awaad judgment.

We’ve got a lot of work to do on dubious diagnosing and medical costs.

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