Trust, But Verify – The Pitfalls of Relying Too Heavily on Experts

When you engage an expert, it can become easy to think, “Now I don’t have to do anything myself; I can rely on their wisdom!” Don’t fall into that trap.    

Last week, as part of our firm’s monthly webinar series, I talked about the Two-Midnight Rule. In the middle of the talk, I had a bit of an epiphany. Before the Two-Midnight Rule was finalized, Medicare guidance about the definition of an “inpatient” was remarkably sloppy. The Benefit Policy Manual said that you should admit a patient if you expected them to be in the hospital “overnight.”

A few sentences later, it suggested using 24 hours as a benchmark. Obviously, those two standards are different, at least outside of the Arctic Circle in the winter. There was even another paragraph with a third mushy standard.

Regular readers know I say you should never refund without a regulation requiring it. Here, there was no regulation, and the non-binding guidance was totally internally contradictory. So, why were there so many refunds and settlements? Why did hospitals unnecessarily surrender millions of dollars?     

I strongly suspect that in many cases, the people who made the decision to refund or settle did not have a firm grasp on the strength of their legal defenses, and they were relying on advice from an “expert” who was wrong. Digging into legal and operational details can seem intimidating.

Many years ago, when I was working on the kyphoplasty investigation, I had to learn how InterQual worked. It was daunting. First, I had to find a copy of the book, which proved to be no easy task. Then, I had to navigate it. A hospital’s CEO or CFO or general counsel typically is going to have no real experience with that level of detail.

Even if they have the desire to learn it, they often will not have the time. As a result, they are likely to defer to an internal or external expert’s advice.  

I wholeheartedly encourage the retention of experts. It’s not possible for any human to become an expert on every topic. If you’re running a hospital, or even “just” a compliance program at a hospital, you’re going to need to call on the expertise of other people, to some extent. But there is a big difference between involving an expert and replying on an expert. Getting advice is smart. But relying on the conclusion of the expert without fully understanding their reasoning is where you can get into trouble. 

If a professional is telling you that you have a compliance problem, you need to make them spell out the regulations in full detail. I would encourage you to ask the person to highlight the strongest argument that could undermine their recommendation. I also would be sure to read the source material on which they are relying.

This won’t help you find documents that your expert entirely overlooked, but it will at least help you verify that their interpretation of a particular text is accurate. Here, any critical reader could spot the flaw. 

If hospital CFOs had required their compliance professionals to show them the language from the Benefit Policy Manual, I would think some of them would have said, “Wait, this text establishes three different standards. How can the government argue we were supposed to know which one to follow?” That question is apparent even if you don’t focus on the fact that Manuals are not fully binding.   

The bottom line is that you can’t just rely on what other people say. Instead, pressure-test their theories. Listen to experts, but in the active sense of listening, carefully considering whether the expert is exercising independent judgment – or going along with a herd.