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June 24 2016

Medicare Bust Uncovers Nearly $1 Billion in Fraudulent Billing

Patrice L. Onwuka

More than  300 individuals were nabbed and charged as part of the largest national coordinated sweep between federal and state officials to go after Medicare and Medicaid fraud. Instead of the usual thieves and gangsters, the criminals were doctors, nurses, and health professionals who participated in schemes to overbill or inappropriately bill Medicare for services that sometimes weren’t rendered.

The charges included bribes and kickbacks, embezzlement, billing for medically unnecessary health procedures, reimbursements for prescription drugs, and fake claims.

For example, in Texas, one doctor allowed unlicensed people to perform physical services but then billed Medicare as if he performed them. In Louisiana, three defendants were charged as part of scheme with a defunct home health care provider. They paid recruiters to find patients who then either never received nor never qualified for home health care as billed. A California doctor performed unnecessary vein ablation procedures then charged $12 million in fraudulent billing.

The Medicare Fraud Strike Force, which is responsible for this dragnet, is part of a joint initiative between the Departments of Justice and Health and Human Services (HHS) announced back in 2009. To-date nearly 1,200 individuals have been charged involving more than $3.4 billion in fraudulent billings.

This was good news for the Obama Administration’s Justice Department and Attorney General Loretta Lynch who had a bad PR week due to how the Justice Department is abysmal handling the investigation. In a statement, Lynch was quick to self-congratulate and laud praise on her agency:

“As this takedown should make clear, health care fraud is not an abstract violation or benign offense – It is a serious crime… The wrongdoers that we pursue in these operations seek to use public funds for private enrichment… Above all, they abuse basic bonds of trust – between doctor and patient; between pharmacist and doctor; between taxpayer and government – and pervert them to their own ends.”

And her buddy at HHS, l Secretary Silvia Matthews Burwell, jumped on with praise for ObamaCare:

“… our action shows that this administration remains committed to cracking down on individuals who try to defraud the program… We are continuing to put new tools and additional resources to work, including $350 million from the Affordable Care Act, for health care fraud prevention and enforcement efforts....”

These efforts build on last year’s coordinated effort when the Strike Force nabbed 243 individuals for falsely billing $712 million to Medicare. More people caught is a good thing.

However, what this might indicate should not be so encouraging to these officials: it might just mean that Medicare fraud is growing even more out of control, as a Deloitte report finds:

Dan Olson, a senior manager with Deloitte & Touche and a certified fraud examiner, called the takedown “encouraging” and said it could deter others from committing such crimes. He said, however, it's important not to forget that the overall problem of healthcare fraud is getting worse, not better. Government benefit programs made total improper payments of $137 billion in 2015 compared with $38 million in 2005, according to a recent Deloitte report.

“We need to get to prevention,” Olson said. “We need to stay two steps ahead of where the fraudster is and anticipate those emerging trends.” Deloitte's recent report recommended the government battle fraud by focusing on data collection, emphasizing prevention and sharing intelligence, among other ideas.

Furthermore, the expansion of Medicaid under the Obama Administration through ObamaCare threw open the door to some of this healthcare fraud.

By pushing more people into Medicare and Medicaid the Obama administration has ensured that rooting out fraud is a whale of a task.

Independent Women’s Forum’s mission is to improve the lives of Americans by increasing the number of women who value free markets and personal liberty. Sister organization of Independent Women’s Voice.
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