Could Medical Devices in the Field Help Prevent Fraud?

Medical devices, as I reported earlier this month, are becoming more and more important to health care as they get more sophisticated, more compact, cheaper, and easier to deploy in the home. But in addition to improving care, keeping patients out of the hospital, and providing useful clinical data to researchers, could medical devices help with one of the biggest contributors to escalating health costs–could they help prevent fraud?

Fraud is definitely sucking money from the health care system. The Coalition Against Insurance Fraud (while cautioning that accurate statistics are hard to gather) estimated that Medicare and Medicaid made an estimated 23.7 billion dollars in improper payments in 2007. The Wall Street Journal just reported the conviction of a single scam that cost Medicare 205 million dollars.

Governments aren’t the only ones paying bad claims. Private insurers are obsessed with fraudulent charges. And all payers–both government and private–put up huge bureaucratic barriers to payments in order to combat fraud, elevating health costs even more.

Deliberate charges for work that was never performed represent the extreme end of a range of poor medical practices. Medicare defines a category of “abuse” in addition to fraud. Examples of abuse include performing an unnecessary procedure and offering treatments in an ineffective manner.

What can medical devices do? As developer Shahid Shah pointed out in an interview, devices provide authoritative information that is more accurate than impressions reported by either patients or health care providers. This means they can objectively indicate:

  • Traits and statistics indicating the presence of diseases and medical conditions

  • Traits and statistics indicating that treatments were applied

  • Traits and statistics indicating the remission of symptoms

In other words, evidence from devices can verify that a treatment was necessary, that it was administered, and that it was effective. To carry out their role in fraud prevention, devices must be secured. When a manufacturer’s testing verifies their accuracy, the manufacturer should digitally sign them, and each transmission from the device should bear the signature. Tampering should, as much as the manufacturer can guarantee, disable the digital signature. Analysis may also be able to detect other ways of gaming the system, such as patients creating artificial conditions to simulate medical problems.

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  • http://www.healthcareguy.com Shahid N. Shah

    Great article, Andy. I think the idea of using connected medical devices to prove compliance and utilization for certain services makes enormous sense. Right now all kinds of fraud happens because no real, non-repudiatable, proof exists beyond signatures on some sheets of paper.