Introduction

Rep. Fred Upton, R-Mich. Carlos Osorio/AP

Four Republican House leaders want federal officials to suspend payments to hospitals and doctors who switch from paper to electronic health records, arguing the program may be wasting billions of tax dollars and doing little to improve the quality of medical care.

In an Oct. 4 letter to Health and Human Services Secretary Kathleen Sebilius, they suggested that $10 billion spent so far on the program has failed to ensure that the digital systems can share medical information, a key goal. Linking health systems by computer is expected to help doctors do a better job treating the sick by avoiding costly waste, medical errors and duplication of tests.

The letter urges Sebilius to “change the course of direction” of the incentive program to require that doctors and hospitals receiving tax money get digital systems that can “talk with one another.” Failure to do so, the letter says, will result in a “less efficient system that squanders taxpayer dollars and does little, if anything, to improve outcomes for Medicare.” The letter urges Sebelius to suspend payments under the program until rules are written requiring that the systems share information.

The letter is signed by Ways and Means chairman Dave Camp, R-Mich., Energy and Commerce Chairman Fred Upton, D-Mich., Ways and Means health subcommittee chairman Joe Pitts, R-Pa. and energy health subcommittee chair Wally Herger, R-Calif.

The Office of National Coordinator for Health Information Technology, which runs the incentive program, did not respond to a request for comment on the letter on Friday.

The harsh criticism from Congress is unusual given the strong support that digitizing medicine has received from both political parties in recent years.

President George W. Bush in 2004 first set the goal of creating a digital medical record for every American within ten years. But in early 2009 the Obama administration championed using stimulus money to achieve the goal, hoping electronic health records would both enhance the quality of medical care and hold costs in check.

In all, the Obama administration expects to spend more than $30 billion to help doctors and hospitals purchase the gear and use it to improve health care. More than half the nation’s hospitals have received some payments from the program, and so far more than $10 billion has been spent. About half the doctors now billing Medicare are using digital records.

Many medical leaders also hope digital records revolutionize the nation’s health care delivery. For starters, researchers hope to be able to mine data from millions of patients to discover better ways to treat disease and improve the nation’s overall health, which requires computers to link to each other. The initiative also is backed by a broad coalition of groups, from an elite corps of technology experts to organized labor.

But the congressmen also noted emerging concerns that so far the digital medical revolution has prompted doctors and hospitals to bill higher charges to Medicare.

The Center for Public Integrity’s “Cracking the Codes” series, published last month, found that thousands of medical professionals have steadily billed higher rates for treating seniors on Medicare over the last decade — adding $11 billion or more to their fees.

The Center’s year-long investigation strongly suggested that Medicare billing errors and abuses are worsening as doctors and hospitals switch to electronic health records. A similar report was subsequently published by the New York Times.

“Recent reports revealed that the EHR (electronic health records) program may be leading to higher Medicare spending and greater inefficiencies while doing little if anything to improve health outcomes,” the House Ways and Means Committee said in a statement.

Obama administration officials acknowledged the problem for the first time last month, asserting that some doctors and hospitals may be cheating Medicare by using electronic health records to improperly bill the health plan for more complex and costly services than they actually deliver — a practice known as “upcoding.”

HHS Secretary Sebelius and Attorney General Eric Holder on Sept. 24 warned five hospital and medical groups of their intention to ramp up investigative oversight, including possible criminal prosecutions, of upcoding.

The Center for Public Integrity investigation found that digital medical and billing equipment can with the touch of a button create an exquisitely detailed medical file and thus present a challenge to government auditors concerned about preventing billing abuse and fraud.

But in the rush to get the program off the ground federal officials failed to impose strict controls over billing software, despite warnings from several prominent medical fraud authorities to do so. Now officials admit they lack a system to monitor the hundreds of billing and medical software packages in use across the country to prevent overbilling.

Most manufacturers and medical professionals using the gear contend that it merely allows them to more efficiently bill for their services, which in the past was often done by hand.

Medicare’s shaky finances also have emerged as a presidential campaign issue, with both Barack Obama and Mitt Romney promising to tame its spending growth while protecting seniors. But there’s been little talk about the impact of billing and coding practices in driving up costs, and what to do about them.