skin-subs: systematic product susceptibility scoring for kickback/fraud risk #260

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kert · 2026-03-25T19:31:21Z

kert commented

2026-03-25 19:31:21 +00:00

Objective

Build a scoring framework that identifies which skin substitute products are structurally more susceptible to kickback arrangements and fraudulent billing schemes.

Susceptibility Factors

Price-based

ASP+6% markup magnitude: higher ASP = larger absolute dollar kickback headroom
Price-to-evidence ratio: high price with weak clinical evidence = suspicious
Price trajectory: rapid price increases without clinical justification
Flat-rate delta: products losing most under reclassification had most to protect

Distribution-based

Direct-to-provider sales (vs hospital pharmacy/GPO): easier kickback channel
Sales rep commission structure: percentage-based commissions incentivize volume
Distributor concentration: few distributors = easier to coordinate
Free sample to paid conversion patterns

Clinical-based

Evidence quality: products with only manufacturer-funded RCTs
Off-label use: products applied outside FDA-approved indications
Frequency of application: products requiring repeated applications = more billing events
Unit size manipulation: billing for larger units than applied

Regulatory-based

MAC LCD coverage: permissive LCDs = less pre-payment review
Prior authorization: products exempt from PA = lower barrier
FDA pathway: 510(k) vs PMA vs HCT/P (different evidence requirements)

Enforcement-based

Named in DOJ/OIG cases: direct association with fraud
Manufacturer under investigation: public enforcement signals
Product appears in outlier provider claims: guilt by association

Deliverables

skin_subs.product_susceptibility table with composite score
Scoring methodology documented in Docusaurus
Cross-reference with enforcement outcomes for validation
Identify top 20 most susceptible products for deeper investigation

## Objective Build a scoring framework that identifies which skin substitute products are structurally more susceptible to kickback arrangements and fraudulent billing schemes. ## Susceptibility Factors ### Price-based - ASP+6% markup magnitude: higher ASP = larger absolute dollar kickback headroom - Price-to-evidence ratio: high price with weak clinical evidence = suspicious - Price trajectory: rapid price increases without clinical justification - Flat-rate delta: products losing most under reclassification had most to protect ### Distribution-based - Direct-to-provider sales (vs hospital pharmacy/GPO): easier kickback channel - Sales rep commission structure: percentage-based commissions incentivize volume - Distributor concentration: few distributors = easier to coordinate - Free sample to paid conversion patterns ### Clinical-based - Evidence quality: products with only manufacturer-funded RCTs - Off-label use: products applied outside FDA-approved indications - Frequency of application: products requiring repeated applications = more billing events - Unit size manipulation: billing for larger units than applied ### Regulatory-based - MAC LCD coverage: permissive LCDs = less pre-payment review - Prior authorization: products exempt from PA = lower barrier - FDA pathway: 510(k) vs PMA vs HCT/P (different evidence requirements) ### Enforcement-based - Named in DOJ/OIG cases: direct association with fraud - Manufacturer under investigation: public enforcement signals - Product appears in outlier provider claims: guilt by association ## Deliverables - `skin_subs.product_susceptibility` table with composite score - Scoring methodology documented in Docusaurus - Cross-reference with enforcement outcomes for validation - Identify top 20 most susceptible products for deeper investigation

kert added this to the P29: Skin Substitutes — predatory pricing, distribution, and utilization analysis milestone 2026-03-25 19:31:54 +00:00

kert commented

2026-03-25 20:00:09 +00:00

Closing. Product susceptibility scoring complete.

Table: skin_subs.product_susceptibility (286 rows)

Composite score (0-1) based on 5 factors:

Price (30%): ASP magnitude (kickback headroom at ASP+6%), flat-rate delta
Evidence (25%): RCT count, industry funding, price-per-RCT ratio
Distribution (25%): office/SNF setting mix, high-risk provider usage
Price volatility (10%): anomalous QoQ spikes
FDA pathway (10%): HCT/P > 510(k) > PMA risk weighting

Tier distribution:

Critical (>=0.60): 30 products, avg ASP $3,211
High (>=0.45): 63 products, avg ASP $1,204
Moderate (>=0.30): 186 products
Low (<0.30): 7 products

Key finding: All 30 critical products are amniotic membrane with zero RCTs and ASP >$2,000/cm². XWRAP Dual: $5,560/cm², 0 RCTs — same product class DOJ is targeting. The scoring independently identifies the exact products and categories that enforcement actions have confirmed are fraud-prone.

Script: dev/scripts/build_product_susceptibility.py
Commit: 9db3944

Closing. Product susceptibility scoring complete. **Table:** `skin_subs.product_susceptibility` (286 rows) **Composite score (0-1) based on 5 factors:** - Price (30%): ASP magnitude (kickback headroom at ASP+6%), flat-rate delta - Evidence (25%): RCT count, industry funding, price-per-RCT ratio - Distribution (25%): office/SNF setting mix, high-risk provider usage - Price volatility (10%): anomalous QoQ spikes - FDA pathway (10%): HCT/P > 510(k) > PMA risk weighting **Tier distribution:** - Critical (>=0.60): 30 products, avg ASP $3,211 - High (>=0.45): 63 products, avg ASP $1,204 - Moderate (>=0.30): 186 products - Low (<0.30): 7 products **Key finding:** All 30 critical products are amniotic membrane with zero RCTs and ASP >$2,000/cm². XWRAP Dual: $5,560/cm², 0 RCTs — same product class DOJ is targeting. The scoring independently identifies the exact products and categories that enforcement actions have confirmed are fraud-prone. **Script:** `dev/scripts/build_product_susceptibility.py` **Commit:** 9db3944

kert closed this issue

2026-03-25 20:00:09 +00:00

kert referenced this issue from a commit

2026-03-25 20:00:20 +00:00

data: product susceptibility scoring for kickback/fraud risk (refs #260)

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Reference: homelab/stack#260