About this episode
Episode 502 features Stacey's conversation with Brian Machut (Alliant Health) on how widespread Medicare fee-for-service fraud is inflating costs and undermining ACO shared savings in MSSP and ACO REACH. ACOs uncovered major urinary catheter fraud in 2023 tied to codes A4352/A4353, totaling about $3.5B, with some beneficiaries billed for items never received (including a case shared by Dr. Tara Lagu). CMS created a "SAHS" (significant, anomalous, highly suspect) process to remove certain suspect costs, but benchmark effects can unevenly impact ACOs; catheter fraud is still projected at $3–$3.5B in 2025. The episode also highlights rapidly growing "skin substitute" spending projected at $13–$15B in 2025; CMS did not classify 2024 skin substitute costs as SAHS, leaving them in ACO performance calculations. Machut explains this fraud and missed CMS trend projections can reduce provider earnings, discourage participation in value-based care, and potentially drive cost shifting into higher commercial rates—affecting plan sponsors such as self-insured employers. === LINKS === ? Show Notes with all mentioned links: https://cc-lnk.com/EP502 ?? Enjoy this podcast? Subscribe to the free weekly newsletter: https://relentlesshealthvalue.com/join-the-relentless-tribe ? Support the podcast with a small donation to the Tip Jar: https://relentlesshealthvalue.com/join-the-relentless-tribe ? Listen on Apple Podcasts https://podcasts.apple.com/us/podcast/feed/id892082003?ls=1 ? Listen on Spotify https://open.spotify.com/show/6UjgzI7bScDrWvZEk2f46b ? Subscribe to our YouTube channel https://www.youtube.com/@RelentlessHealthValue === CONNECT WITH THE RHV TEAM === ? LinkedIn https://www.linkedin.com/company/relentless-health-value/ ? Threads https://www.threads.net/@relentlesshealthvalue/ ? Bluesky https://bsky.app/profile/relentleshealth.bsky.social ? X https://twitter.com/relentleshealth/ 00:00 One way hackers are using medical data to commit Medicare fraud. 01:49 What today's conversation with Brian Machut entails. 02:16 The downstream impact that this Medicare fraud can have. 03:30 A brief outline of how plan sponsors can be affected by this Medicare fraud. 06:38 What does a value-based actuary do? 08:04 The conversation with Brian Machut: What caused his team to look into DME costs and uncover Medicare fraud? 08:46 How much did this fraud scheme cost organizations in 2023? 09:57 How this data was tracked down and uncovered. 11:13 How fee-for-service ACOs work, and why this Medicare fraud affected the ACOs' shared savings. 12:46 The two codes that were the target of this fraud. 15:13 Across the U.S., how much money in 2023 did this fraud, waste, and abuse
