Among the many whoppers President Obama packed into his recent address to Congress, he declared that once he creates “a publicly-sponsored insurance option, administered by the government just like Medicaid or Medicare…I will make sure that no government bureaucrat or insurance company bureaucrat gets between you and the care that you need.”

Just like Medicaid and Medicare? Medicaid and Medicare don’t get in between patients and the care that they need? Really??

That was too much for a correspondent of mine, a government bureaucrat who oversees other government bureaucrats who come in between patients and the care that they need. He writes:

I am government bureaucrat…and I just happen to be reviewing cases, albeit involving Medicare and Medicaid, where the government has inserted itself between the patient and the care prescribed by the physician.

Some time ago the Center for Medicare and Medicaid Services contracted with a consulting firm…to audit Medicare and Medicaid providers. Pursuant to this contract, [the firm] audited certain hospital records. In the cases I am reviewing, [the firm] would perform a computer analysis looking for situations where a hospital admitted a patient only to discharge the patient the next day. (This is just one of the many things they audited for; e.g., the use of intense care rehabilitation in joint replacement cases).

[The firm] then reviewed the hospital’s justification for the admission and, when [it] “determined” that the admission was not appropriate, the hospital would be required to repay the money it had already been paid – the audit dated back to 2003. The cases proceed through a reconsideration process and if it’s still determined that the hospital admission was improper, the case ends up on my desk for adjudication.

I happen to have six of those cases now, from three different hospitals. In all six cases the patients had significant chronic health problems and all were having acute episodes at the time of admission. Of the six, five were senior citizens, and one was having problems with a pregnancy. In each case a “panel of experts” determined that, based on the medical evidence, the hospital’s admitting doctor was unjustified.

Setting aside the medical issues, which in each case were significant, you and I both know that a large factor in the admitting doctor’s decision is the potential liability for the hospital. I am sure in each case the doctor considered just what would happen if he sent the patient home they died. Even if liability would not ultimately attach to the hospital, the cost of fighting such a lawsuit would be considerable. Of course, the so-called panel of experts does not have to worry about medical malpractice, so that issue does not figure into their consideration.

It is extremely rare for the patient to be held financially liable in such cases. So, one could argue that they got the treatment they needed and didn’t even have to pay for it. But, how long will it be before hospitals become so “gun-shy” that they refuse to admit patients for care, fearing that they will not be reimbursed by Medicare?

By the way, [that] contract was just a trial run. CMS has contracted with a number of audit firms to conduct a similar and on-going program review nationwide. So we will be seeing these “20–20 hindsight” reviews of doctor’s decisions for a long time.

Of course, the president’s IMAC proposal would make those powers much more explicit and sweeping.

If the president thinks it’s a good idea to give the federal government more power to ration medical care, he should say so. It’s a defensible position.

But to claim that’s not what he’s proposing, or that the government doesn’t do that already, is a … oh, what’s the word … ?