NOVEMBER 1, 1999 VOLUME 7, NUMBER 18
Two programs—Medicare and Medicaid—provide the majority of acute medical and long-term nursing care for America’s senior citizens. In fact, those two programs provide over one third of all medical care for Americans of all ages. With the total cost of those two programs approaching $400 billion per year, efforts have intensified to cut the cost of medical care for the poor and elderly.
Health care rhetoric frequently focuses on fraud in the Medicare and Medicaid programs. Estimates of the extent and cost of fraud are difficult to come by, but range as high as $33 billion per year (see, for example, the National Center for Policy Analysis website at www.ncpa.org/health/pdh5.html).
In response to concerns about fraud in federal health care programs, the Administration in 1995 announced the formation of a program to find and eliminate fraud. Named “Operation Restore Trust,” the initiative claimed almost $25 million in returned program dollars in its first year of operation. Originally focused on the five most populous states, the program was soon expanded into smaller states, including Arizona. Other states and agencies have also begun concerted anti-fraud efforts.
The State of New Mexico, for example, recovered almost $2 million over a six-year period from a program focusing on criminal investigations and prosecutions. A single nursing home prosecution in 1997 returned over $100,000.
Much of the fraud uncovered by federal and state investigators is subtle. Earlier this year, for example, federal prosecutors in Florida indicted Jack Campo and five other men for allegedly participating in an illegal “kickback” scheme. Doctors are accused of accepting fees for referring patients for unnecessary tests and procedures; the total loss from the actions of the defendants is alleged to be over $1 million.
Fraud in Medicare and Medicaid is not always subtle. Operation Restore Trust has unearthed instances such as a van service billing $62,000 to transport a single patient 240 times in a sixteen-month period. In another case, a single psychiatrist billed an average of 26 sessions per day, each lasting 45 to 50 minutes.
This year, Operation Restore Trust will turn its focus to fraud in nursing home care. Four years of publicity and prosecutions may have caught some of the most flagrant instances of abuse, and deterred others who now fear the possibility of public exposure and prosecution.
For more information on fraud in the Medicare and Medicaid programs, visit the Health Care Financing Administration’s internet website at www.hcfa.gov/medicaid/mbfraud.htm or the Administration on Aging’s site at pr.aoa.dhhs.gov/ort/ (the AoA is a division of the Department of Health and Human Services).
