"That's the bread and butter of the fraudster — the fact he can pay somebody to participate in the scheme," says Dennis. "If you have a willing participant, you then eliminate the ability to tie the fraud to you. That person is going to lie for you because they conspired with you."


"All of these prosecutions are great," says Louis Saccoccio, CEO of the National Health Care Anti-Fraud Association. "We have strike forces, but the prosecutions just tell you we have a big problem, because that means the money's already out the door. So the focus now is starting to shift to prevention."

President Obama has expanded the task forces and made fighting fraud a pillar of the Affordable Care Act, otherwise known as Obamacare. CMS was given greater discretion in suspending payments and screening providers before they entered the system. Penalties and prison time were also increased.

Gov. Rick Scott was CEO of a hospital company nailed with two sets of books. Then he went into politics.
Gage Skidmore
Gov. Rick Scott was CEO of a hospital company nailed with two sets of books. Then he went into politics.
Christopher Dennis and Reginald France work out of the Miami-area HEAT task force office.
Liliana Mora
Christopher Dennis and Reginald France work out of the Miami-area HEAT task force office.

But excuse congressman Michael Burgess' skepticism. The Tea Party Republican from Texas has heard such talk before.

The former gynecologist is willing to concede that progress has been made. Yet the sheer size of the task makes crime-fighting difficult. Every day, Medicare contractors process 4.5 million claims. Even Republicans admit that CMS is undermanned and forced to rely on contractors, whose ferreting out of fraud is inconsistent at best.

"There was a famous case here in Dallas where a Nigerian woman had been busted," Burgess says. "As she was going off to jail, it was discovered that she had several other provider numbers. They discovered that she was receiving checks at the same post office box. It never occurred to anyone that, 'Hey, anything that goes to P.O. Box 9058, that's a red flag.' We were probably paying for her defense."

In New York, centers for people with mental issues were charging the feds $5,000 per day per patient. Arizona, by comparison, charges $200 a day. The reimbursements were based on a changing formula that CMS kept approving even as payments skyrocketed. New York's estimated overcharges: $15 billion. Even though CMS discovered the state's gouging, six years later, it's still negotiating a remedy. CMS now plans to let New York phase out its overbilling, essentially allowing the state to steal a little less each month. (CMS officials declined to be interviewed for this article.)

More obvious improvements still elude the agency — even such basics as changing a beneficiary's Medicare number when theirs is stolen or used in a fraud. Others wonder why CMS hasn't mimicked credit-card companies, which flag suspicious behavior within minutes.

"I sent my staffer to Chick-fil-A with my personal credit card to charge $100 of sandwiches for our office for lunch," says Burgess. "So I'm called off the floor of the House to answer a phone call from my credit-card company saying, 'Hey, someone is trying to charge $100 worth of sandwiches.' Why can't [Medicare] do that?"

Obamacare has allocated $100 million to CMS to create a similar computer system that would employ data analytics to flag suspicious claims as soon as they're billed. The new proactive stance includes a spiffy command center in Baltimore linked to field agents. In its first full year, the system identified or prevented $115 million in fraud.

But as Burgess notes, Obamacare provided CMS with "seven new tools" to fight fraud. Four years after the law passed, CMS has managed to enact just one.

"At this rate, some point before my natural death, maybe we'll have done half of them," says the congressman.

Though most everyone agrees that the government is moving in the right direction, $100 billion continues to walk out the door each year.

"This is a lucrative business, and business is good," says Feinwachs. "The only problem is that you and I are funding it."

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8 comments
dr.jaya
dr.jaya

This well written article should have beeen published in JAMA and New Engand Journal of Medicine ..

dr. jaya

smdrpepper
smdrpepper

Well considering that Rick Scott made millions off this should be telling.

Milord
Milord

Does it surprise anyone that a state that elected a man who made his millions by defrauding Medicare has an increasing problem with medicare fraud? It is high time the people of Florida extruded their crania from their recta and got rid of Gov. Voldemort! Over and over again the voters make the illogical, thoughtless and intelligence-denying choices. 

WAKE UP!

riverrat69
riverrat69 topcommenter

Medicare fraud might be sweet in south FloriDUH, but it buys you the governors seat in Tallahassee.

jefles
jefles

Chris mentions the congressional hearings where Congressman Burgess talks about his credit card and Chick-Fil-A.  At 1:01:28 of the same hearings, Congressman Shimkus holds up a card, that runs through the credit card networks, that would prevent much of that fraud.  I am the guy who invented it, and John Shimkus is holding up a card I gave him to demonstrate that not only is this possible, it works today.  We have proven it. 

frankd4
frankd4 topcommenter

"That's the bread and butter of the fraudster — the fact he can pay somebody to participate in the scheme," says Dennis. "If you have a willing participant, you then eliminate the ability to tie the fraud to you. That person is going to lie for you because they conspired with you."

in the olde dayz a gangster took the newbie with him and at the right time handed the newbie the GUN to do the hit........................voila the newbie was now a co-conspirator

so today the co-conspirator simply has to take money to collude, and collusion is the one thing an auditor cannot design an accounting system to prevent

if these clowns weren't so greedy these overbilling frauds could go on endlessly

frankd4
frankd4 topcommenter

don't just take ONE geographic area since any medical facility anywhere can simply CODE reimburseable medicare and medicaid medical proceedures to maximize revenue generated

the typical geographic area only need those who qualify for such coverage and who can produce a valid social security number = period

i can predict that every second hobo at a random bus station would be a potential profit center - i withnessed one old dude at BCT central terminal went from a walker ($300) every three weeks to a fully equiped wheelchair ($16,875) which he even had pin-striped; otherwise this miscreant didn't have two nickles to rub together

i saw it start myself a dozen or so years ago at assisted-living facilities whereas the home would profit from commissionable sales of goods and services to the qualifying residents who knew nothing of how things were being paid

finally MAIN street has a scam equal to WALL street, in scope and magnitude, which will eclipse even the mortgage meltdown, and certainly reach beyond our governors office, when fully exposed, as to who all the players really are

miami321973
miami321973

Hialeah is third world territory and not part of the United States.

 
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