Frankie Bordeaux: Medicaid Fraud? Or Victim Of Dirty Politics & Racism?

Anti-Medicaid Fraud Crusader & Political Candidate Accused Of Medicaid Fraud


A Greenville state Senate candidate who has made an issue of the state's overpayment of mental health claims is himself on the hook for $4.2 million in Medicaid overcharges for services provided by his family's company.

Frankie Bordeaux and his wife, Hattie Faye Hardy Bordeaux, signed a settlement with the state in February that included a two-year repayment plan for money improperly collected by Cambridge Behavioral Health Services in Greenville. The first monthly payment, $241,296, was due this month.

An investigation of Cambridge by the state Medicaid office found hundreds of cases of incomplete patient records, "several instances of potential fraud," duplicate or "canned" notes, and unqualified staff delivering care, according to the settlement.

Of 476 records reviewed, the office found 428 cases in which patients were served at unauthorized sites, 366 instances in which the staff was not qualified to provide the service offered, and hundreds of other discrepancies with their records. The review found problems with nearly 95 percent of the company's claims.

Groups under scrutiny

For the last several years, the state has been cracking down on providers of a mental health service called community support.

Companies came under scrutiny when government auditors found they were treating people who did not need help and were billing for work they didn't do. Legislators last year decided to phase out most of that program.

The $4.2 million deal with Cambridge is the second-highest settlement with a mental health company in the last four years, according to the Medicaid office.

The case was sent to the Medicaid Investigations Unit in the state attorney general's office. An investigation is under way.

Bordeaux said he is not an example of the mess he has pledged to clean up.

"I am not part of the problem," Bordeaux said. "While my name is associated, tied to it, it has nothing to do with me running for this seat."

Bordeaux, who incorporated the company that became Cambridge with his wife, is not an owner, his lawyer said. Bordeaux said he is now the administrative director, in charge of human resources and the business office.

Fighting NC Corruption

Bordeaux, a Democrat, is challenging incumbent Sen. Clark Jenkins in a primary in the district covering Edgecombe, Martin and Pitt counties.

He has made fighting government corruption a cornerstone of his campaign, even criticizing the state Department of Health and Human Services for its overpayments to companies such as his that offer community mental health services.

"Like most citizens, I am growing weary of news headlines documenting public corruption and scandal in our state government," says a statement on his campaign Web site.

"Graft, corruption and scandal are not acceptable and politicians and bureaucrats who personally benefit from their service - need to be prosecuted and punished," the statement continues. "Furthermore, we must do more to hold bureaucrats and government officials accountable for their actions."

Jenkins, who is seeking a fifth term, has always faced a Democratic primary opponent.

Bordeaux has tried to paint Jenkins, a longtime friend of Senate leader Marc Basnight and a former state Department of Transportation member, as out of touch with the district.

The wrong location

Bordeaux said most of Cambridge's problems resulted from the company's serving clients in unauthorized offices.

Cambridge was serving patients from offices in Rocky Mount before the company discovered it needed clearance from the local mental health office to operate from those locations, Bordeaux said.

Local mental health offices must endorse providers and their locations.

Each location gets a separate billing number, so that local offices can track which providers are working in their regions.

In October 2008, a local mental health office in Rocky Mount reviewed Cambridge's records and directed the company to stop taking new patients from its area. But Cambridge continued to do so through December 2009, according to a letter from the local office.

The legal settlement says that Cambridge presented bills for the patients as though they were being treated from the Greenville office, rather than from Rocky Mount.

Not the owner

James Jorgensen, a Raleigh lawyer representing Cambridge, said situation was the result of poor communication between the company and the local mental health office, which is called the Beacon Center. "I think Cambridge misunderstood what the Beacon Center requested of them," he said.

Jorgensen wanted to make it clear that Frankie Bordeaux does not own the company.

Only Bordeaux's wife is listed on the most recent business incorporation papers. She holds the title of manager. Bordeaux signed earlier versions of the business filings and was an incorporator, with his wife, of Cambridge Behavioral Health's precursor, Child & Adolescent Counseling Services Inc.

Cambridge denied in the settlement that it committed abuse or fraud.

"If we had litigated, we could have shown a lot of things that could have been rebutted," Jorgensen said.

Brad Crone, head of the Raleigh campaign firm Bordeaux hired, said Jenkins tried use the settlement to push Bordeaux out of the race.

Jenkins said he never used the settlement to pressure Bordeaux not to run.

"I do not intend to get in the mud with that," Jenkins said. "I did not do it."


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Sources: McClatchy Newspapers, NC Senate.org, Youtube, Google Maps

North Carolina Busted By The GAO For Medicaid Fraud (Again)...Health Care Reform Watch

GAO report: Millions in fraud, drug abuse clogs Medicaid


As Congress debates the government's role in health care, a report out Wednesday finds that state and federal officials failed to detect millions of dollars in Medicaid prescription drug abuse.

An audit of the government program in five large states found about 65,000 instances of beneficiaries improperly obtaining potentially addictive drugs at a cost of about $65 million during 2006 and 2007 — including thousands of prescriptions written for dead patients or by people posing as doctors.

The report, by the Government Accountability Office (GAO), represents "an enormous opportunity to save money," says Sen. Tom Carper, D-Del., who has scheduled a hearing Wednesday on the findings.

When bills for the doctors' visits are added, along with the potential for Medicaid fraud in states not reviewed by the GAO audit, Carper said: "We're talking hundreds of millions of dollars."

That could be good news for President Obama, who argues that a massive expansion of health care coverage can be funded by squeezing waste out of the current system. But as Pres. Obama continues to press for a government-run health insurance plan, the GAO report also reveals shortcomings in how the government manages Medicaid. The program for low-income and disabled Americans, run jointly by states and the federal government, underwrote more than $23 billion in drug costs last year.

The GAO audit focused on 10 types of frequently abused prescription drugs — painkillers and mood-altering medications. Abuse of such medications is "second only to marijuana," Joseph Rannazzisi of the Drug Enforcement Administration says in prepared testimony for the hearing.

A well-known example is the death of pop star Michael Jackson, which was ruled a homicide in August after revelations that the singer had pressed his personal physician to prescribe powerful sedatives to help him sleep.

The states targeted by the GAO — California, Illinois, New York, North Carolina and Texas — accounted for 40% of Medicaid's prescription drug payments in fiscal years 2006 and 2007. They are not fully taking advantage of federal databases or technology that could spot fraud, the report said.

The GAO found:

• About 65,000 cases where Medicaid beneficiaries visited six or more doctors and up to 46 different pharmacies to acquire prescriptions — a practice known as "doctor-shopping" that allows purchasers to exceed the legal limit of drugs.

• Sixty-five doctors or pharmacists writing or filling prescriptions after being banned from Medicaid, some for illegally selling such drugs.

• About 1,800 prescriptions written for dead patients and 1,200 prescriptions "written" by dead physicians.

States are working to prevent Medicaid prescription abuse but there are "significant issues that must be addressed," Ann Kohler, director of the National Association of State Medicaid Directors, says in testimony prepared for the hearing. One obstacle she identified: tight state budgets that are slowing needed information-technology improvements.




North Carolina Must Repay Feds $300 Mil For Medicaid "Billing Errors" (Fraud)

-It took the state months to notice that one of its Medicaid funds was flush with money, but employees couldn't figure out why.

Now, because of a huge accounting error, North Carolina must repay the federal government about $300 million for taking too much for public hospital services.

The state will pay back $200 million by the end of this month, and will repay the rest during the next 11 months, according to the state Department of Health and Human Services.

Medicaid is the federal government's health insurance program for the poor and disabled. The state received about $7.5 billion in federal Medicaid money last year. Though the federal government pays most of the costs, the state picks up about one-third of the expenses.

The mistake was triggered in November, when a state worker sent the department's controller's office incorrect information on how much money hospitals should take from the federal government and how much they should take from the state account, said Lanier Cansler, DHHS secretary.

State workers noticed the Medicaid account was out of whack about March, but couldn't find the source of the problem, Cansler said. The state discovered the mistake at the end of June as it prepared to make more changes to Medicaid billing formulas, and told the federal government about it.

The $200 million can be repaid almost immediately because the state has unspent money in the account hospitals were supposed to be tapping, Cansler said.

The $300 million mistake comes at a sensitive time for Gov. Beverly Perdue, as she pushes for tax increases to cover a budget that is nearly a month overdue. Earlier this week, the governor upended budget negotiations, saying she could not support a budget with an income tax surcharge and a drop in per pupil education spending.

In a statement, Perdue said she told Cansler and the state's new Medicaid director, Craigan L. Gray, to make correcting the problem a top priority. She said she wants a report on disciplinary actions.

"While this problem may have originated prior to my term as Governor, the circumstances under which it was made and perpetuated are simply unacceptable," she said.

Perdue said Friday she ordered DHHS to tell the state budget office if its Medicaid accounts are more than 2 percent off projections and submit a report explaining the cause.

This isn't the first time the state has lost the handle on Medicaid payments. DHHS was criticized in a recent legislative report for losing track of how much Medicaid money it was spending on a community mental health program that peaked at more than $100 million a month soon after it started.

New computers coming

A key to better monitoring Medicaid money, Cansler said, is a computer system that will be installed in four months that will let users know quickly how much money is being withdrawn from accounts and where it's going. It will replace a system that Cansler called "old and outdated."

The computer system will cost about $500,000, and the federal government will pay about 90 percent, he said.

After discovering the mistake, DHHS and the state budget office checked all of the department's federal accounts and will examine them each month for problems, Cansler said.

"It raises confidence issues in my mind about everything," he said. "We didn't find anything else. We will continue to look at everything like that and how we can strengthen controls."

Not being run very well

Senate Minority Leader Phil Berger, an Eden Republican, said the state should have been taking such care with its accounts all along.

"You would think there would be internal audit procedures and internal review procedures," he said. "This is just one more indication that our state is not being run very well."

In the past, the state has been asked to repay Medicaid because of incorrect payments to hospitals.

In 2006, the state and 51 hospitals had to repay the federal government $151.5 million in excess Medicaid payments made over six years. The hospitals paid $91.5 million and the state was responsible for the rest.

A two-year investigation found that the state mistakenly claimed too much money through a federal program designed to subsidize hospitals for their care of poor patients.



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Sources: USA Today, GAO, Whitehouse.gov, Charlotte Observer, News & Observer, US Dept of HHS Inspector General, DEA, Health Reform.gov, National Association of State Medicaid Directors, Allbusiness.com, Wikipedia, Google Maps

Frequent Medical Billing Errors....Another Reason For Health Care Reform

Red Tape Chronicles, MSNBC----

Scott Fedyshyn and his wife recently brought home a bouncing baby boy -- and an unexpected $600 medical bill. But Fedyshyn, a trained billing consultant, fought back. He demanded itemized bills from his doctor explaining each charge, and why his health insurance wouldn't cover some items.

Soon, he got another statement from the doctor's office – but this one came with a $20 refund check.

Billing errors are common, experts say. Double-billing, typos, upselling, and outright fraud add up to big unexpected medical bills for consumers -- even those who think they are fully covered by insurance. A complex web of bills, forms, and other paperwork mean a lot of Red Tape for health care, and often leads to overpayment by consumers.

Fedyshyn's tale is typical, and simple. A few weeks after the birth of his son, now 10 weeks old, he received the bill.

"It said, 'Amount due: $600.’ And there was no real explanation for it," the 29-year-old from Virginia said. "I said I wanted a line-by-line breakdown of what was not covered and why."

When he received the breakdown, the reason for the discrepancy was obvious: an ultrasound image of the baby that insurance refused to pay for. The physician's billing department had coded the procedure as if the Fedyshyn family had requested an extra – and unnecessary -- baby image during their initial visit. But in fact the doctor had ordered it because their child was facing the wrong direction when the first "picture" was taken, and the doctor wanted a second look.

"So it should have been covered," Fedyshyn said. "After going back and forth a bit, it was changed."

These kinds of small errors in billing and coding can lead to big bills for patients, said Candy Butcher, CEO of the Medical Billing Advocates of America. Her firm trains advisors who sell medical billing audit services to consumers. Most work on contingency basis, taking 20 to 40 percent of the refunds they earn for clients.

"Eight out of 10 bills we see have some error," she said.

Harvard Professor Malcolm Sparrow, author of “License to Steal: How Fraud Bleeds America’s Health Care System,” said many medical bills seem arbitrary.

“Insurance companies and medical provider billings seem to bill on the basis of ‘let's just see what we can get away with,’ knowing that many consumers are too timid to question them,” he said. Recently, when he questioned a bill, he was immediately offered a $200 discount as a “professional courtesy.”

“I took it as sure evidence that (the provider) knew the original bill was unjustifiable,” he said. “A sign of how aggressive the billings are would be the apparent ease with which they back off and adjust their demands when called to justify them.”

All about coding

Errors can occur in many ways. In Fedyshyn’s case, the doctor’s office had incorrectly described its treatment to the insurance company when it “coded” the procedure. Each separate medical procedure, treatment, or drug given to a patient is recorded by the doctor or hospital in software, boiled down into a short numeric code. When providers miscode, insurance companies often reject the bill, and the patient can end up paying the difference. It can be easier for doctors to send patients a bill than to resubmit insurance claims.

Robert Tennant, senior policy adviser for the Medical Group Management Association – a trade group that represents physicians – said it’s hardly fair to lay the blame for overbilling on doctors.

The complexity of billing procedures is a breeding ground for mistakes, he said.
“With the thousands of health plans, complications galore, the lack of standardization, it’s inevitable that this is going o be the outcome,” he said.

Here’s one glimpse of the tortured billing process doctors face. After a visit, doctors code a patient’s ailment using a standard called ICD-9 (International Classification of Diseases). Currently, doctors must choose from about 17,000 possible codes. There are nearly 10 codes just to signify an ankle sprain, for example. But such coding can still be inexact, and many ailments must be squeezed into one designation or another. It’s obvious how errors might occur.

In an effort to improve the precision of the codes, the Department of Health and Human Services (which manages the coding standards with Medicare) has added a host of new designations – there will be 155,000 possible code diagnoses soon. The new system will allow for recording of far more granular details: for example, whether a laceration to the head was caused by an ice hockey stick or a field hockey stick. Doctors must implement the system by 2013. An average small doctor’s office will have to pay $84,000 just to upgrade their systems to handle the new coding scheme, Tennant said.

“It’s a very complicated process,” Tennant said. “And it’s going to get even more complex.” Blue Cross and Blue Shield, for example, expect coding errors to increase 10 to 25 percent in the first year of the new system.

The penalty to physicians for incorrect coding is severe: Generally, insurance companies will deny all claims with coding mistakes. And that’s just one of the roadblocks to payment that can spring up along the way. Others abound. There are, for example, about 1,200 potential claim forms used by health insurance companies. So while doctors must wait until long after they have provided care to receive payment – try that with your auto mechanic – consumers end up utterly confused when they look at their bills, and often don’t even know how to begin questioning costs.

“What we’re getting at is the question of transparency,” he said. “As a patient, you might ask, ‘Why can’t I just see how much it costs for a medical procedure?’ Well, because it’s very obscure even for the provider … and the reality is because it's so complicated errors do occur.”

RED TAPE WRESTLING:

Four steps to fair billing
Fedyshyn, who managed to get a refund from his physicians, knew the right questions to ask because he’s a consultant who challenges balance sheets for a living. But many consumers just pay their bills, happy to be healthy and feeling they don't have the expertise to challenge complex hospital stay bills, Butcher said. Many consumers could do just as well as Fedyshyn, however, if they took a few simple steps during and after their medical treatments, she said.

Her tips:

1. Always request a "detailed itemized statement" from a hospital or doctor. Most will provide only a summary statement unless asked. The detailed statement is the foundation for any bill challenges.

2. Nothing is routine. On that detailed statement, many consumers find unfair or excessive charges for routine items like gowns, toothbrushes, gauze, and so on, Butcher said. Many times, those items are supposed to be included as part of room and board or operating room charges.

3. Kits for procedures are often a source for overcharging, she said. For example, she's seen separate bills for scalpels when patients are also being billed for operating kits that include the scalpel.

4. Clerical errors. Sometimes patients are billed for medications for days after the doctor stops administering them, for example. Or four X-ray charges end up on a bill when only two are taken.

Naturally, many consumers are in no position to track all these things during their health care stay. But the original doctor's orders for all procedures should be available to a patient through a request for medical records. Many times, patients should request those records after they receive their initial Explanation of Benefits (EOB) form from their insurance company, which show what costs are covered by insurance and what kind of bill to expect from the doctor or hospital.

Once a discrepancy is suspected or found, Butcher recommends patients go directly to the supervisor of the billing department at a hospital. She suggests patients send a certified letter with evidence of the error, and state clearly a desire that the item be placed "in dispute" and a request for a “30-day hold” on the payment process. That should stall any potential collections activity while the dispute is worked out.

Don’t be afraid

Challenging a doctor's bill is easier said than done, however. Many consumers feel reluctant to challenge their physician's authority, particularly if they have an ongoing relationship with him or her. Even Fedyshyn said he'd gulped hard after raising an issue with a different pediatrician over tests that had been ordered which weren’t covered by insurance.

But Butcher said that shouldn't be a concern. Virtually all doctors she's worked with have been helpful when errors are brought to their attention.

"Physicians most of the time have no idea what goes on with the billing process. ...This has nothing to do with the care that is provided," she said. "It has to do with people hired to work in the billing department and the coding of items. When we bring things to the attention of physicians, they have been more than willing to adjust it off the bill or give some kind of credit. So people should not be afraid to bring it up to their physician."
Naturally, most consumers don't pay a lot of attention to hospital bills unless their explanation of benefits statement indicates they will face a big out-of-pocket expense. But Butcher said patients should scan their bills carefully even if they are fully covered. It pays to watch out for overpayments by the insurance company, she said. Why?

Consumers can run into annual caps and find themselves forced to pay at the end of the year -- or worse.

"Most policies have a lifetime cap, and if you have a terminal illness, it's very easy to meet that lifetime maximum," she said. "Even though it may not benefit you financially now, you should still look over those bills. If the insurance company pays something they should not have, in the long run, that could hurt you, too."


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Sources: Red Tape Chronicles, MSNBC, Eurthisnthat, Google Maps