Sep 4, 2011

MedicalConspiracies- Billions in Medicare/Medicaid lost to fraud, abuse, The cheating is brazen

Billions in Medicare/Medicaid lost to fraud, abuse
Jim Kouri, Law Enforcement Examiner .

Missing from President Barack Obama's health care program pitch last
night was the likelihood that increased government control will also
mean increased fraud, corruption and abuse of the system.

Last night, millions of Americans watched President Barack Obama sell
his national health care plan on nationwide television. The reporters
during the televised question and answer portion of Obama's
performance attempted to appear unbiased, but their tone and demeanor
was a marked difference from the attack approach they use on
conservative politicians. And not one reporter asked about the
potential for fraud and corruption in such a huge financial endeavor.

With the Obama Administration and Democrat leaders in both houses of
the US Congress desperately pushing a major overhaul -- many say
government takeover -- of US health care, a report obtained by the
National Association of Chiefs of Police's Fraud & White Collar Crime
Committee sheds light on the fraud and corruption already existing in
government medical programs. And one can only imagine the amount of
corruption that will occur with total government control of the

According to Steven Malanga of the Manhattan Institute, experts
estimate that "abuses of Medicaid (alone) eat up at least 10 percent
of the program's total cost nationwide -- a waste of $30 billion a
year. Unscrupulous doctors billing for over 24 hours per day of
procedures, phony companies invoicing for phantom services,
pharmacists filling prescriptions for dead patients, home health-care
companies demanding payment for treating clients actually in the
hospital -- on and on the rip-offs go."

The cheating is brazen because scam artists have figured out that
years of lax oversight have made Medicaid easy plunder, according to

On April 22, 2009, Government Accountability Office officials
testified before an ad-hoc Congressional subcommittee at a hearing
entitled, "Eliminating Waste and Fraud in Medicare and Medicaid."

In a subsequent letter responding to a May 29, 2009 request for
responses to questions for the record related to the April 22, 2009,
testimony, the GAO responded to the following questions: What do you
see as the biggest challenge for Centers for Medicare/Medicaid
Services (CMS) to provide an estimate for improper payments under
Medicare Part D? Has GAO identified any problems with the current
process for reviewing and paying Medicare claims that would make the
program more vulnerable to fraudulent claims? Is there any reason the
US federal agency which administers Medicare, Medicaid, and the
Children's Health Insurance Program cannot include penalties in its
Medicare Administrative Contractor contracts for paying improper or
fraudulent claims that they are aware of?

With total outlays of about $46 billion in fiscal year 2008, Medicare
Part D is the last significant part of Medicare for which the
department has yet to develop an estimate of improper payments. In
developing its estimate, it will be important for CMS to determine
where the vulnerabilities and risks exist in the Medicare Part D
structure and operations that could impact CMS's ability to
effectively detect, measure, and ultimately reduce improper payments.

In HHS's fiscal year 2008 AFR, the department reported that it had
calculated payment error rates for two components of Medicare Part D
but also that its measurement was not fully implemented. Also, it will
be important to consider Health and Human Services' Office of
Inspector General identified concerns about CMS's implementation of
internal controls to ensure payment accuracy as well as inadequate
analysis of claims data.

The GAO investigation identified several weaknesses with the current
process for reviewing Medicare claims. Limitations in the number of
medical reviews conducted leave the home health benefit -- within the
Medicare program -- vulnerable to improper payments, including
payments resulting from fraud and abuse.

In previous studies, the GAO reported in February 2009 that in fiscal
year 2007, only 0.5 percent of the more than 8.7 million home health
agency (HHA) claims processed were subjected to prepayment review by
Medicare's contractors.

The contractors focused primarily on claims submitted by HHAs whose
billing patterns differed from their peers on measures such as cost
per episode. Of those claims that were reviewed, over 40 percent were
denied in whole or in part. There are also weaknesses with respect to
selecting claims to review in Medicare Fee-for-Service.

In addition to the weaknesses with the current Medicare claims review
process, analysts found that failure to effectively screen health
providers before granting them billing privileges also increases the
program's vulnerability to fraudulent claims.

Consistent with the Social Security Act and applicable federal
procurement regulations, CMS may include provisions in Medicare
Administrative Contractor (MAC) contracts to: prescribe the costs
incurred by MACs in processing and paying Medicare claims that CMS may
reimburse; provide incentives or disincentives related to payment
accuracy; and hold MACs and their employees liable for improper or
fraudulent claims payments under limited circumstances.

Otherwise, neither the Social Security Act nor applicable federal
procurement regulations expressly provides for CMS to reduce amounts
owed to MACs under their contracts or to assess charges against MACs
for improper or fraudulent claims payments.

Opponents of the plan currently considered by the US Congress --
commonly known as ObamaCare --believe that if the US government
succeeds in taking control of the health care industry, losses due to
fraud and abuse will drastically increase.

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