The Medicare Fraud Epidemic

medicare fraud

Medicare fraud has become a growing epidemic throughout the United States. With millions of people still struggling to acquire health insurance and medical professionals hoping to make a quick buck, the government-run system has turned upside-down.

Law enforcement has been successful in pinpointing fraud and prosecuting those involved. Unfortunately, Medicare fraud cases are still an ongoing issue and something that must regularly be investigated. But why is this occurring? Why does it seem that Medicare fraud is becoming a bigger problem?

Medicare Fraud on the Rise

Prosecutors in Miami recently accused 21 residents of participating in a $25 million home health care fraud scheme. Included in the indictment were two doctors, six nurses and 11 patient recruiters who were said to have conspired to commit fraud, make false statements and solicit kickbacks.

While it may seem surprising that health professionals would be involved in some form of health care fraud, it is actually very common.

In fact, in Feb. 2011, the biggest Medicare scam takedown in U.S. history involved multiple health care professionals using patients to drum up phony business so that those professionals could make fake claims to Medicare.

The takedown included 114 people across nine metropolitan areas who hoped to defraud the government of over $240 million. Among defendants charged in the schemes were a physical therapist, podiatrist, proctologist and chiropractor.

Of course, Medicare fraud is also common among every day criminals. For instance, one scam consists of criminals who pose as pharmacies to make fake claims.

In this scenario, the criminals will use a legitimate address to establish a fake pharmacy business. Using stolen doctor IDs and patient insurance ID numbers, the scammers write fake prescriptions and then submit them for reimbursement to Medicare and Medicaid for large returns.

Why Are Medicare Fraud Cases on the Rise?

It seems like we haven’t seen this many cases of Medicare fraud in the past. So why is it increasing?

Law enforcement says the main reason you’re likely to see increasing Medicare fraud news is that health professionals are generally displeased with the way government reimbursements are handled.

A recent study reported in a June issue of New England Journal of Medicine revealed that medical specialists are denying children Medicaid coverage because they don’t like to deal with low reimbursement rates, payment delays and hassles associated with the payment process.

These reimbursement issues have been cited as a reason that professionals take to crime–but it’s not the only reason.

Law enforcement says Medicare fraud is also on the rise simply because it is very easy to get away with. The process to file a claim only requires a few easy steps.

And since each claim filed must be paid in 14 to 30 days by a system that receives millions of claims each day–and only about 3 percent actually get reviewed–plenty of scams slip through the cracks.

Law Enforcement Taking Steps to Control Medicare Fraud

Because estimates show the government loses somewhere between $60 billion and $2 trillion each year from health care fraud, law enforcement and lawmakers say they are working hard to crack down.

One way the government is taking action is by organizing Strike Force teams. These teams are led by a federal prosecutor and include four to six members, with at least one member from the FBI and the HHS Office of Inspector General.

The teams use mathematical evaluations to determine billing irregularities and patterns. While the teams may take months to correctly identify fraud, they have been successful in prosecuting individuals involved in fraudulent acts.

In addition to Strike Force teams, the Centers for Medicare and Medicaid Services are asking individuals to step in and fight fraud. According to the Centers’ blog, Senior Medicare Patrol volunteers are teaching people how to “spot, report, and stop fraud.”

Here are some steps offered by the Centers to avoid fraud:

  • Guard Medicare and Social Security numbers.
  • Never accept calls from a person asking for your Medicare number, Social Security number or bank/credit card information.
  • Be suspicious of individuals offering free medical equipment or services then asking for your Medicare number as this is illegal.
  • Check Medicare claims for errors via your Medicare Summary Notice (MSN) or other statements from your Medicare plan. Also, you can check as soon as claims have been processed to check accuracy.

If you suspect you have been the victim of fraud or know someone who may be scamming others, you can report Medicare fraud by calling 1-800-MEDICARE.