The evolution of Medicare fraud

Apparently, Medicare fraudsters are working harder—and smarter—for the billions of dollars they pilfer every year from the massive federal healthcare program.

Federal officials told a Senate panel this week they see a trend away from the “lazy man's fraud” of charging Medicare for phantom durable medical equipment toward more complex scams involving home healthcare and other outpatient treatment.

Home health scams were at the heart of a $25 million Medicare fraud case uncovered last year, which was the focus of Tuesday's hearing by the Senate Finance Committee, which has primary jurisdiction over Medicare.

Home health cases are particularly concerning to Daniel Levinson, HHS' inspector general, because they are undetectable by standard CMS compliance reviews of Medicare providers.

“We found from a compliance record standpoint that home health agencies were doing very good," he said. "Then we uncovered situations like this.”

The reimbursement paperwork submitted by the more than 50 defendants involved in the home health cases was perfect. It was only a tip by defendants in another case that led investigators to unravel the criminal conspiracy.

So how will federal investigators uncover more such costly scams?

“Ultimately, you have to come up with metrics that will do a better job to separate out-hopefully before they get into the program-those who really don't belong in that field,” Levinson said.

Levinson said the discovery of the massive home health scam-despite clean compliance reports-makes it clear such metrics have not been developed.



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