$4.2 Billion in Fraudulent Activities in 2012

According to a recent joint press statement from the Department of Justice (DOJ) and the Department of Health and Human Services (HHS), $4.2 billion was recovered from fraudulent health care activities in FY2012. (1)

Image Credit: istockphoto.com

Here are a few other 2012 highlights from the press release:

• The DOJ opened 1,131 new criminal health care fraud investigations.
• 826 defendants were convicted of health care fraud.
• As a direct result of Medicare Fraud Strike Force operations, 117 people were indicted, 278 people were charged, 251 admissions of guilt were made, and 29 guilty verdicts for fraudulent billings of $1.5 billion as a result of  legal penalties under the Affordable Care Act (ACA) were obtained. (1)

Affordable Care Act Protections Against Medicare and Medicaid Fraud
One important objective of the Patient Protection and Affordable Care Act (PPACA) is to strengthen Title XI Social Security Act protections against Medicare and Medicaid fraud. A 2010 Congressional Research Service Report entitled, “Health Care Fraud and Abuse Laws Affecting Medicare and Medicaid: An Overview,” discusses these protections. The PPACA already imposes civil and criminal penalties against those found liable for fraudulent health care activities involving federal government funds or resources.  Additional civil penalties may be imposed under the PPACA for individuals who knowingly file fraudulent documents in conjunction with a false Medicare claim, fraudulently enroll as a provider of Medicare services, do not report or return overpayments, or fail to cooperate with the Office of the Inspector General (OIG) in a timely manner with regard to program investigations or audits. (2)

Federal False Claims Act
Federal law prohibits Medicare fraud in the form of false billing for services not rendered, overbilling for services rendered,  double billing, or billing for unnecessary medical services. The PPACA  facilitates qui tam legal actions in which whistleblowers work in conjunction with the government in legal pursuit of individuals involved in illegal health care fraud. (2)

Anti-Kickback Statute
Kickbacks are a no-no under the Anti-Kickback Statute.  It’s pretty self-explanatory.  Prior to the PPACA defendants had to “knowingly and willfully” break the law.  This is no longer necessary as knowledge and intent requirements are retracted under the PPACA. (2)

Stark Law Exceptions
According to provisions of the Stark Law physicians may not engage in self-referral when treating Medicare and Medicaid patients if a personal financial interest is involved.  However, not all hospitals and health care organizations are required to comply with the Law.  Exceptions for “whole hospital services” and “in-office ancillary services” apply.  Now, the “whole hospital services” exception is a bit arcane, as it was originally intended for rural hospitals. It seems that this loophole in the law is being excessively exploited by for-profit specialty hospitals.  The PPACA places deadline-based restrictions on the ability of new hospitals to qualify for the exemption.  Ancillary designated health services loopholes are also being scrutinized by the PPACA. (2)

Activity Since the Passage of the Affordable Care Act
This video highlights health care fraud fighting efforts since the passage of the PPACA in 2010:(3)

Senate Offers Medicare/Medicaid Fraud-Fighting Recommendations

The Senate Finance Committee addresses Medicare and Medicaid Waste, Fraud, and Abuse (Originally Posted by Dorkina Myrick, M.D., Ph.D. at PolicyKina on February 4, 2013) in a new report released on January 31. (4, 5)  The Medicare and Medicaid programs are administered by the Centers for Medicare and Medicaid Services (CMS). One hundred sixty-four health care experts were consulted regarding billions of tax payer dollars lost annually to Medicare and Medicaid fraud.

Among the recommendations:
1.       States should receive a boost in federal funding for Medicaid fraud-fighting activities
2.       Consistent use of provider enrollment policies
3.       Examining Medicare payment policies which, through pricing differences, foster susceptibility to waste, fraud, and abuse
4.       Balancing Medicare contractor incentives concerning overpayment findings with penalties for contractors whose findings are reversed via CMS administrative appeals procedures
5.       Installing a clinical advisory panel to monitor CMS contractor activities
6.       Identifying and eliminating state and federal Medicare/Medicaid anti-fraud programs.
7.       Use of current CMS moratorium and mandatory compliance programs

HHS Releases Public Service Announcement for the Elderly

References:
1       “Departments of Justice and Health and Human Services Announce Record-Breaking Recoveries Resulting from Joint Efforts to Combat Health Care Fraud.”  HHS.gov Website.  February 11, 2013. http://www.hhs.gov/news/press/2013pres/02/20130211a.html.  Retrieved February 16, 2013.
2.       Staman, Jennifer. “Health Care Fraud and Abuse Laws Affecting Medicare and Medicaid: An Overview.” Congressional Research Service Report. Congressional Research Service. August 10, 2010.
3. “Fraud Prevention Efforts Recover $4 Billion.” Press Conference.  Department of Health and Human Services.  January 24, 2011. Video Online.  http://www.youtube.com/watch?v=ybuiOLDq5CY&w=560&h=315.
4.       “Bipartisan Finance Committee Members Release Recommendations to Combat Waste, Fraud & Abuse in Medicare & Medicaid.”  Press Release.  Senate Finance Committee.  http://www.finance.senate.gov/newsroom/chairman/release/?id=4e573856-e65f-49f5-ab73-1cb6bde47cc9.  Website. January 31, 2013.
5.        Myrick, Dorkina.  “Senate Finance Committee Addresses  Medicare and Medicaid Fraud, Waste, and Abuse.” PolicyKina.  http://policykina.com/2013/02/04/senate-finance-committee-tackles-medicare-and-medicaid-waste-fraud-and-abuse/.  Originally Retrieved February 16, 2013. Updated Retrieval on March 15, 2013.

Revised March 15, 2013

Categories: Policy

Tags: abuse, Affordable Care Act, Centers for Medicare and Medicaid Services, CMS, Department of Health and Human Services, Department of Justice, DOJ, elderly, fraud, Health, health care, HHS, Medicaid, Medicare, Office of the Inspector General, OIG, Patient Protection and Affordable Care Act, PPACA, Senate Finance Committee, waste