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Outside editorial: Health care fraud is a big - and sleazy - business

Posted: May 10, 2012 - 12:00am

The following editorial appeared in the St. Louis Post-Dispatch:

News coverage of last week’s simultaneous arrests of 107 people in seven cities for alleged health-care fraud pretty much appeared and disappeared in a day, at least outside Miami, Baton Rouge, Houston, Los Angeles, Detroit, Tampa and Chicago, the cities involved.

Behind the headlines, however, is a little-noticed law enforcement program that has focused exclusively on health-care fraud, waste and abuse for 15 years.

Given the fashionable reflex to blame government for everything, it’s worth taking special note of a joint federal, state and local collaboration that so far has recovered and returned more than $20 billion of taxpayer money to the Medicare Trust Funds, and additional funds to other health care programs.

The indictments underpinning last week’s operation by multiple federal, state and local agencies allege some $450 million in false Medicare billings, more than any other single enforcement action to date.

In addition to handling the arrests, more than 500 agents of a special Medicare Fraud Strike Force also suspended the Medicare participation rights of 52 health care providers and executed an additional 20 search warrants connected with other ongoing investigations.

The strike force, which is jointly supervised by the U.S. Departments of Justice and Health & Human Services, operates through the authority of the Health Care Fraud and Abuse Control Program originally created by Congress in the Health Insurance Portability and Accountability Act of 1996.

According to a description released by HHS, the charges against those arrested in last week’s seven-city operation were based on “a variety of alleged fraud schemes involving various medical treatments and services such as home health care, mental health services, psychotherapy, physical and occupational therapy, durable medical equipment and ambulance services.”

There were bills submitted for medical services that weren’t needed and bills for services that were never provided, as well as kickbacks paid for Medicare beneficiary information used in submitting the bills.

Those arrested deserve fair trials and, if convicted, license revocations and prison time.

Contrary to the tired racial and class stereotypes of high-living welfare queens and other supposed cheats, health care fraud strike force investigators — working in the real world — find large-scale fraud where the large-scale money is: on the provider side, not the consumer side.

Last week’s indictments and supporting court documents named owners of health care companies and ambulance companies, doctors, nurses, licensed social workers, physical and psychological therapists and a pharmacist.

The annual report on the Health Care Fraud and Abuse Control Program, released in February, charted some $4.1 billion collected through criminal and civil enforcement actions and deposited in the Medicare Trust Funds and the U.S. Treasury and transferred to other federal agencies involved in health care programs.

Not included are funds returned to states for fraud involving Medicaid.

At 17 percent of America’s gross domestic product, health care is as big and complex a business as there is, and most of its constituent parts operate honestly. But there’s so much money in play that would-be criminals seem endlessly creative and resourceful.

Estimates of the annual cost of health care fraud range from $60 billion to $90 billion.

The enforcement work of the Health Care Fraud and Abuse Control Program has returned an average of $5.10 for every $1 spent since 1997, and the ratio has increased in recent years.

Those are rich dividends.

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