Federal Crack Down on Medicare Fraud Reaps Record Recovery of $4.1 Billion

New fraud monitoring tools implemented by federal authorities in order to crack down on healthcare fraud are paying off. Reports indicate that a record $4.1 billion was recovered and returned to Medicare Trust Funds, the Treasury and other departments during 2011. The Department of Justice and the Department of Health and Human Services conducted joint programs so that federal, state and local law enforcement agencies were coordinated to better combat healthcare fraud. Compared to 2009, this amount represents a 50 percent increase.

In addition to actually visiting healthcare providers' sites that are in a moderate risk category to assure that a legitimate office exists, the Department of Health and Human Services reports that they are also improving the screening process for providers prior to allowing their entry into the system, along with more stringent enrollment requirements. Those providers that are identified as higher risk are required to go through fingerprint and criminal background checks.

This more proactive approach is beginning to take hold. Authorities screen providers and categorize suspicious providers so that payments can be stopped prior to incurring the cost of fraudulent activities. This puts an end to the old system of paying claims, then going after the suspicious ones, a system by which the fraudsters are able to either flee the country or dump their provider ID to escape liability. Federal health officials report that the sharing of data with other agencies is also improving. It is estimated that Medicare fraud costs the nation in the range of $60 billion to $90 billion annually.

Kathleen Sebelius, Health and Human Services Secretary, said in a statement, "Fighting fraud is one of our top priorities and we have recovered an unprecedented number of taxpayer dollars. Our efforts strengthen the integrity of our health care programs, and meet the President's call for a return to American values that ensure everyone gets a fair shot, everyone does their fair share, and everyone plays by the same rules."

Much of the credit for the increase in recovered funds goes to strike force teams that have been established in cities around the country, including Miami, Detroit and Los Angeles. A total of 323 defendants were charged in 2011, representing more than $1 billion billed to the Medicare program by these criminals. One of the cases involved more than 100 doctors, nurses and physical therapists across nine states.

For those criminal matters related to the pharmaceutical and device manufacturing industry, $1.3 billion in criminal fines, forfeitures, restitution and disgorgement were recovered by the Justice Department by obtaining 21 criminal convictions and under the Food, Drug and Cosmetic Act. Civil healthcare fraud recoveries obtained under the False Claims Act were approximately $2.4 billion dollars.

Officials at the Department of Justice report that the message is now going out with longer sentences levied by judges. Compared to 2010, the average sentence in 2011 increased by 5 months, from 42 months to 47 months.

"These efforts reflect a strong, ongoing commitment to fiscal accountability and to helping the American people at a time when budgets are tight," Attorney General Eric Holder said in a statement.

"Fighting fraud is one of our top priorities and we have recovered an unprecedented number of taxpayer dollars," Health and Human Services Secretary Kathleen Sebelius said.


Feds Recover Record $4.1B in Health Fraud, UPI.com, February 14, 2012

Feds Beef Up Screening for Medicare Providers; Agency Recovered $4.1 Billion Last Year, Washington Post, February 13, 2012

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