How Fighting Health Fraud Is Like Playing Whack-A-Mole

Partner content from Kaiser Health News

Whack-a-mole creature looks out of hole. i i

hide captionHealth fraudsters can pop up just about anywhere.

Whack-a-mole creature looks out of hole.

Health fraudsters can pop up just about anywhere.

Health care fraud bilks taxpayers and the government out of $65 billion — with a "B" — a year.

And no wonder. Lots of money makes a ripe target. And a combination of private and public payers makes for a convoluted system that's easy to game, despite plenty of people looking to combat crime.

But even as as federal officials today tout the recovery of $2.5 billion in Medicare overpayments last year, they are also looking at parts of the new health law designed to make criminals think twice about padding Medicare bills or just flat-out charging for care never provided.

The law provides $300 million over the next 10 years for stricter enforcement of health fraud and allows the Department of Health and Human Services greater latitude to investigate companies — using fingerprinting, site visits and even criminal background checks — before they start billing Medicare or Medicaid. Last fiscal year, officials opened more than 1,000 new health care fraud investigations.

The changes come as schemes to defraud the system get bolder. In Texas, a husband-wife doctor team recently pleaded guilty and forfeited $44 million in assets for billing Medicare for millions in narcotics and procedures they never provided for patients.

A ring in Detroit paid Medicare beneficiaries a few hundred dollars each of dollars in exchange for their Medicare information and used it to bill Medicare for $14.5 million in services they too never rendered.

But in Miami, a man recently pleaded guilty to using eight fraudulent clinics to file false claims and con the Medicare system out of $61 million he used to buy jewelry, watches and race horses. His two Lamborghinis, a Ferrari, two Bentleys, and at least eight Mercedes Benzes cost about $3 million.

Such a widespread problem – storefront clinics pop up like a whack-a-mole game – seems impossible to combat. National Health Care Anti-Fraud Association Executive Director Lou Saccoccio says, “It's just inevitable that unless you're very, very aggressive about going after fraud you're going to lose a lot of money." But he think there are some solutions.

Saccoccio spoke recently about some of the ideas with Kaiser Health News. Among them:

  • Use government strike forces to keep the pressure on criminals;
  • Delaying Medicare payments to providers when fraud is suspected; and
  • Scrutinize claims more closely before paying them.

Take, for example, home health care, he says:

When you have a company that opens and all of a sudden they are billing for certain services that are well above what the other companies may be billing for, you need to say ‘OK, hold on, before we start sending checks someplace, let's take a closer look.’

What's the one thing Saccoccio would like to see changed right away?

Let the the federal government share Medicare claims information with states and private insurers. "If you take all of that claims data that they have between Medicaid and Medicare and start analyzing it," he said, "You [could] identify where problem areas are."

The government does some of it now, he said, but strictly on an ad hoc basis. A change in that policy could allow real-time fraud identification to "stop that money before it goes out the door," Saccoccio said.

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