How the US Government Is Cracking Down on Medicare Fraud

Posted by Stephanie Mau

on August 22, 2014

Medicare fraud is a major problem in the United States, with estimates of fraud and systematic overcharging totalling $60 billion each year. That’s nearly five times the cost of healthcare fraud in Canada, and makes up a pretty significant 10% of Medicare’s total costs.

To make matters worse, the Centers for Medicare and Medicaid Services, which is responsible for overseeing the anti-fraud efforts, manually reviews only three million of the approximately 1.2 billion claims that it receives each year.

Too Many Cooks in the Anti-Fraud Kitchen

This is already part of the Obama administration’s war on health care fraud, which has invested in a $100 million high-tech system that processes medical claims to search for suspicious patterns.

While the government has attempted to crack down on healthcare fraud by hiring outside contractors, the entire process has been quite poorly managed. There have been too many conflicts of interest between contractors that are often in competition with each other, and their responsibilities are often unclear and vulnerable to political influence.

This isn’t to say that there have not been some successes though. Recovery audit contractors, whose job is to reduce hospital overbilling, have been quite successful in recovering Medicare losses – in fact, since 2009, they have recovered $8 billion.

However, due to recent hospital resistance to these contractors and an appeals process that has become overburdened, their recovery efforts have largely come to a halt.

The same has happened to a particularly successful fraud hotline located in South Florida. Though this hotline has been credited with starting a thousand fraud investigations and identifying tens of millions of dollars in suspicious payments in the last five years, Medicare declared it “no longer necessary.”

Now, calls are being rerouted to a general Medicare number, where complaints can often take months to be properly addressed.

While the government’s efforts to crack down on health care fraud have been somewhat successful, there is still a long way to go – and it seems that for every step forward, their convoluted anti-fraud efforts are taking two steps back.

If a Fraud Hotline Can Help Medicare, It Can Help Your Company

Before Medicare shut down the fraud hotline in South Florida, it was doing wonders to counteract fraud by detecting tens of millions of dollars in suspicious transactions – all due to helpful tips from civilians and costing way less than their fancy $100 million system.

Implementing a third party ethics reporting system with a 24/7 whistleblower hotline could do wonders in preventing fraud in your workplace too.

An independent ethics reporting system like Whistleblower Security can help promote a culture of integrity, collaboration and transparency in your workplace. With a 24/7/365 whistleblower hotline and whistleblower program, employees can be assured that all of their ethical concerns will be heard and addressed.

eBook: 7 Reasons to Implement a Whistleblower Hotline

Source: http://www.nytimes.com/2014/08/16/business/uncovering-health-care-fraud-proves-elusive.html?_r=0