01/01/2025
🔍 How Do Fake Diagnoses Lead to Higher Revenue for Insurance Companies?
Read on and you’ll see.
Thank you to Nick Jones, MD, other docs who were interviewed, and The Wall Street Journal for diving into this complex system and breaking it down.
📰 Full article here: https://www.wsj.com/health/healthcare/unitedhealth-medicare-payments-doctors-c2a343db?st=viiPFb&reflink=desktopwebshare_permalink&fbclid=IwY2xjawHiiMFleHRuA2FlbQIxMQABHbKJTklJpWbWMDtjHvlYqHNvwNcD0Ed_Y1URphYEVIgnGVF8QvDOL-O57A_aem_NA6DzMzveBqsGjYwa1vXMA.
🔗 This post comes in 3 parts:
1️⃣ Basics of Medicare
2️⃣ How Insurance Companies Use Medicare Rules to Benefit Their Bottom Line (But Maybe Not Improve Patient Outcomes)
3️⃣ Why Direct Primary Care May Be a Better Option
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1️⃣ Basics of Medicare:
Here’s how the flow works:
💵 Our tax dollars go to the government ➡️
🏛️ The government provides money to private insurers like Blue Cross, United, Cigna, Aetna, and Humana ➡️
🏥 Those insurers then pay healthcare providers for services rendered to covered patients.
--That’s the system in a nutshell. Agree?
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2️⃣ How Insurance Companies Use Medicare Rules to Increase Revenue:
📊 Patients with more illnesses cost more money to care for than healthier patients.
💡 Insurance companies exploit this: The more “sick” a patient appears, the more money the government pays the insurer.
Here’s how it works:
✅ Certain diagnoses = higher payouts -
Example: “Senile purpura” (common bruising in elderly patients) has no impact on health. Insurance companies will make sure to document that a patient has senile purpura, even if it has no effect on their health, just to increase their payment from the government.
❌ Diagnosing illnesses that don’t exist -
Some patients were incorrectly documented as having HIV or amputations simply because those garnered larger payouts from the government.
The result?
📈 Insurance companies make more money, but patients don’t see improved care or outcomes.
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3️⃣ Why Direct Primary Care (DPC) Might Be Better:
🚫 No insurance middleman
Patients pay a low monthly membership fee for unlimited access to primary care.
🤝 Fair pricing for all
In DPC:
🩺 Healthy patients = $
🩺 Sicker patients = $
Doctors are incentivized to keep patients healthy, not just “looking sick.” Healthy patients visit less often, keeping the practice sustainable.
✨ Benefits of DPC:
✅ Affordable
✅ Transparently priced
✅ High-quality care
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