Industry Execs Targeted for Health Fraud

A new report has found that individual executives in health care are now being targeted in fraud cases that used to be reserved for corporations as a whole. The report, released by The Associated Press, revealed that federal enforcers are making it their business to blame the execs at the top of corporation chain for fraud issues related to Medicaid and Medicare.

Execs in Many Areas of Health Targeted

According to the AP report, the new tactic by the fed is to target the people in charge of running health-related companies when they detect fraud in relation to health insurance or health care.

This means the corporate execs in charge at drug companies, major health care enterprises, medical device manufacturers and even nursing home chains could be targeted if they are suspected of fraud.

This approach is a sharp contrast to previous fraud investigations where if a company was caught in a fraudulent act, lawyers would be able to negotiate a financial settlement, allowing the company to write a check to the government and promise never to break the rules again.

While this approach would let the company off the hook, the costs associated with the settlement would often be passed down to customers.

To avoid this issue, federal enforcers are now looking to have the companies pay fines and are pushing to have senior execs face criminal charges. This is true even if they weren’t involved in the scheme, but could have stopped it if they had known. The repercussions for execs could be getting from doing business with government health programs, which is often a career-ending consequence.

Industry Execs See Approach as Government Overkill

Members of the health industry have expressed displeasure with the new approach, seeing it as government overkill, according to the AP article. They feel the government is trying to dish out radical punishment to individuals whose guilt would be difficult to prove to a jury.

However, the fed, sick of repeat violations stated that this is a better way to ensure law violations don’t continue. If execs feel that they can be personally held responsible for company problems, they may push to run the company in a more responsible manner.

Health care fraud, especially in the areas of Medicare and Medicaid, is known to be costly. In fact, the government is said to lose between $60 billion and $2 trillion to fraud every year.

Some companies are being found guilty of fraud two or even three times from submitting false claims, paying kickbacks to doctors and even marketing drugs that haven’t been tested for safety while still making profits after being found guilty.

While some say the execs at the top are not likely to change their ways because of the new threat, the idea of starting at the top is something the government hopes is a move in the right direction for combating fraud.