August 18, 2014
Three major newspapers recently have taken an in-depth look at various aspects of Medicare fraud and government enforcement efforts. All of them overlooked the effect that “qui tam” (whistleblower) cases have had. Data analysis is an important tool to detect Medicare fraud. But whistleblower cases are a very effective way to stop Medicare fraud and would have an even greater impact if the government put more resources into them.
Medicare fraud costs the government an estimated $60 billion annually. Here are the newspaper stories, which provide some insight into the problems and the challenges that the government faces:
- Since 1998, con-artists have been sending out recruiters to elderly Medicare patients’ homes to try and convince them they needed a power-wheelchair. Patients were diagnosed for problems they did not have so that the fraudulent company could send out marked-up bills to the government, and pocket the extra cash. More than $8.2 billion has been spent on supplying these motorized wheelchairs, but “the government cannot even guess at how much of that money was paid out to scammers. . . .The sucker in this scheme was the U.S. government.” (A Medicare Scam That Just Kept Rolling)
- The Obama administration has made fighting healthcare fraud a top priority, with $600 million a year being wasted. However, a web of private contractors, current and former government officials, and experts in the field, have tangled the process of rooting out and stopping fraudulent practices. A new data analysis tool is now being used to detect Medicare fraud, marking potential billing issues and then sending it onto a contractor to be reviewed. (Pervasive Medicare Fraud Proves Hard to Stop)
- The government is testing the effects of a predictive-analysis data program called the Fraud Prevention System, which, the government hopes, will be a leading way to find and deter fraud. In fiscal year 2013, the program identified or prevented $211 million in improper payments, double that of the previous year. However, the program is going up against almost $60 billion in fraudulent Medicare payments annually. The software is gaining speed, but tips are coming almost solely from tipsters and would-be whistleblowers who often have a firsthand account of the fraud. (How Agents Hunt for Fraud in Trove of Medicare Data)