Medicare Fraud and Abuse: The Most Profitable Healthcare Crime in the U.S.

Medicare fraud and abuse cost taxpayers approximately $60 billion a year. It’s one of the fastest and most profitable crimes in the U.S. The government health insurance program that covers 46 million elderly and disabled Americans is being hijacked by opportunists preying on patients, doctors, suppliers, and lack of oversight of the system itself.

According to President Obama, Medicare fraud and abuse is fueling enormous federal budget deficits. He recently explained that we could pay for healthcare reform if we could eliminate Medicare fraud, abuse, and waste altogether.

Although completely eliminating Medicare fraud isn’t entirely realistic, curbing the growing crimes could provide healthcare to many more Americans and stop lining the pockets of the individuals, crime rings, and corrupt healthcare providers that steal a huge amount of the half trillion dollars in Medicare benefits each year.

The instances of Medicare fraud and abuse are as diverse as they are widespread. One recent high-profile case involved an Armenian-American crime syndicate that stole patient and doctor identities to setup dozens of fake clinics. The operation, which is one of the largest Medicare fraud schemes in U.S. history, resulted in over $35 million in illegal billings.

In another Medicare fraud and abuse case, nine hospitals in seven states were ordered to pay $9.4 million in fines for keeping patients overnight after undergoing what is typically an outpatient back procedure. The hospitals fraudulently billed Medicare for the unnecessary services. In still another case, eight nurses in Florida carried out an $18.7 million Medicare fraud scam in which they forged patient files to make it appear that they required home health care services that they didn’t need or receive.

Although these are just a few of the many types of Medicare fraud and abuse scams occurring each year, they show the urgent need to be vigilant about preventing Medicare scams. From charging for durable medical equipment (DME) never received to using a deceased doctor’s information to continue to bill patients, common Medicare fraud and abuse schemes include:

* Advertising “free” consultations to patients with Medicare, and then recording and using their private information for monetary gain

* Offering healthcare services or DME for free in return for a person’s Medicare number for “record keeping”

* Setting up fictitious clinics with people impersonating doctors to steal private information and commit medical identity theft is another common Medicare fraud and abuse tactic

* Using real patients’ data, but without their knowledge, to steal their identities

* Not adhering to the FTC Red Flag Rules that alert the carriers paying the bills

* Fraudulent billing for a wheelchair, specialized hospital bed, or other DME is also a form of Medicare fraud and abuse

* Falsifying claims for expensive procedures is another common tactic, such as the $5.8 million fraudulent HIV infusion scheme in Miami in which a husband and wife team defrauded Medicare by submitting unnecessary HIV injection and infusion claims.

Remember that when fraud happens to Medicare, it happens to all of us. Don’t let your organization become a victim. Put your employees on the front line to spot Medicare fraud by hiring a healthcare fraud and abuse expert that provides “Lunch and Learn” presentations to help avoid, recognize, and respond to Medicare fraud.