The U.S. Justice Department stated that Medicare pays out $60 Billion in fraudulent charges each year. (This is approximately 14% of Medicare’s annual claims).
Some experts think the number is twice that amount, according to Cynthia McFadden and Almin Karamehmedovic who reported on a four month Nightline investigation into Medicare scams [March 17, 2010 on ABC News). A similar investigation was conducted and reported on by 60 Minutes.
A Medicare fraud strike force was established in 2007, however, before an investigation even begins, the perpetrators usually have already collected Medicare’s payments and closed down their operations.
According to the 60 Minutes and Nightline reports, Medicare fraud has surpassed drug dealing because it is so easy, so lucrative and carries such little risk. A criminal only needs a code book from Medicare showing the billing codes for services and products that Medicare will pay for, plus a list of “patients” showing their names, date of birth, Social Security number and address. They simply fill out their forms correctly and money from Medicare is wired directly into their bank accounts within 30 days. The ABC News reporters interviewed DHHS Secretary Sebelius’ staff who stated that Medicare has the power to stop payments if they suspect fraud. But this is rarely done even when there is clear evidence of fraud.
Most troubling were interviews of Medicare recipients who had actually called Medicare to report that items (products/services) paid for on their behalf were not items that they received (or even needed). For example, a woman said that she first contacted Medicare in 2003 to alert them that she never ordered, received or had any need for an electric wheel chair and other items that Medicare had paid for on her behalf. Over the past 6 years she has received several such reports of Medicare payments for fictitious medical supplies (sometimes duplicate equipment) and every time she called Medicare to let them know. She even asked that they somehow flag her account so that no payments would be made on her behalf without checking with her first since she has not been sick for 30 years... but apparently Medicare has taken no action.
You would think that Medicare would dramatically tighten its enrollment standards for vendors and have each one investigated for a period of time before permitting them to receive Medicare payments. At the very least, patients should be called before payments are made for very expensive items to check that a physician did indeed recommend these items for them. With $60 Billion at stake, it is inexcusable that even such low-tech, low cost measures as these have not been taken.
60 MINUTES ASKED HOW WE CAN EXPECT OUR GOVERNMENT TO RUN A HUGE NEW HEALTH CARE INITIATIVE WHEN THEY CAN’T EVEN RUN MEDICARE EFFICIENTLY.....WE ARE ASKING THE SAME QUESTION
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