50-year-old IT system not up to job of verifying Sask. doctors' billings: auditor

Saskatchewan needs better tools to monitor doctors' billings to avoid overpaying them, says the province’s auditor.

Fee-for-service payment model 'to some extent uses the honour system'

Fee-for-service payments to physicians account for about one-tenth of the total annual costs of Saskatchewan health services. (Goodluz/Shutterstock)

Saskatchewan needs better tools to monitor doctors' billings to avoid overpaying them, says the province's auditor.

As it is, the province is putting its trust in doctors and for the most part, assumes they are honest.

"The fee-for-service arrangement requires physicians to submit accurate billings and, to some extent, uses the honour system," says a report by the auditor released Tuesday.

"It recognizes that the Ministry [of Health] cannot practically confirm the validity of all billings prior to paying physicians."

Saskatchewan's Ministry of Health pays about $500 million annually to about 1,800 doctors under a fee-for-service arrangement. In December 2016, about three-quarters of Saskatchewan's doctors were being paid by fee-for-service.

How fee-for-service works

Under fee-for-service, doctors bill the ministry a set fee for each insured service they provide to a Saskatchewan resident. Every two weeks, doctors enter their billing codes directly into a health ministry IT system. The auditor says doctors may over-bill due to mistakes or misunderstandings or, on occasion, deliberate actions.

The auditor says the IT system, which was originally set up 50 years ago, "has limitations." She says, for instance, it "cannot assess significant amounts of data to identify suspicious activity."

Types of basic checks the system can perform include whether health numbers are valid, whether billing numbers are valid, and whether there are multiple visits being billed for the same patient on the same date by the same physician or at the same clinic.

Manual assessments

These simple checks and "labour-intensive manual assessments," according to the auditor, are what the ministry uses to identify questionable billings. The auditor found each assessor on staff manually checks and processes about 800 billings every two weeks, leaving them little time to assess each billing's validity.

This limits the ministry's ability to recover overpayments from physicians, the auditor says. 

The auditor's report says that an analysis of 2015-16 billing data found 78 physicians, paid $64 million in total, who had billings two times the average of their peer group. 

The Joint Medical Professional Review Committee investigates the billing practices of physicians that the ministry refers to it, and can order physicians to repay. In 2016-17, it reviewed billing practices of nine physicians and ordered repayment of $1.2 million.

3,500 codes

Gord Tweed, acting executive director of the ministry's medical services branch, said there are about 3,500 billing codes doctors' administrative staff can enter into the system, so many errors flagged by the IT system are likely unintentional.

One of the things the government is working on is modernizing the fee schedule, which he said dates back many decades and is "overly complex."

He said the government is working with the Saskatchewan Medical Association on that.

"We want to ensure that physicians have a lead role in establishing care practices and appropriate compensation models for that care."

The auditor's recommendations include conducting a cost-benefit analysis of getting a new IT system that can better screen billing activity, and developing standard criteria to determine which physicians' billing practices should be investigated.