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Healthcare fraud cases hit high last year, report says


By Associated Press
Posted: January 16, 2014 - 3:15 pm ET
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Federal prosecutors filed a record number of healthcare fraud cases last fiscal year, perhaps reflecting the greater emphasis the government has placed on combatting the crime costing taxpayers billions of dollars per year.

According to Justice Department statistics obtained through a Freedom of Information Act request by a Syracuse University-based nonprofit group that tracks federal spending, staffing and enforcement activities, prosecutors pursued 377 new federal healthcare fraud cases in the fiscal year that ended in October. That was 3% more than the previous year and 7.7% more than five years ago.

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Southern Illinois led the nation on a per-capita basis in such cases filed, with the government pursuing 10.1 prosecutions per 1 million people, which was more than eight times the national average.

The latest numbers, while not necessarily showing that the white-collar crime is on the rise, may reflect a greater emphasis by authorities, predominantly the FBI and HHS, to root out the wrongdoing, said Susan Long, who is an associated professor of managerial statistics at the school and the co-director of the nonprofit, the Transactional Records Access Clearinghouse.

"Clearly the numbers suggest this is an area the (Obama) administration is not ignoring," Long said Wednesday.

An illustration of the anti-fraud push came last May, when 89 people in eight cities — including 14 doctors and nurses — were charged for their alleged roles in separate Medicare scams that collectively billed the taxpayer-funded program for roughly $223 million in bogus charges.

Because such fraud is believed to cost the Medicare program between $60 billion and $90 billion each year, Attorney General Eric Holder and HHS Secretary Kathleen Sebelius partnered in 2009 to increase enforcement by allocating more money and staff and creating strike forces in fraud hot spots around the country.

Medicare fraud has morphed into complex schemes over the years, moving from medical equipment and HIV infusion fraud to ambulance scams as crooks try to stay a step ahead of authorities. The scammers have also grown more sophisticated using recruiters who are paid kickbacks for finding patients, while doctors, nurses and company owners coordinate to appear to deliver medical services that they are not.

For decades, Medicare has operated under a pay-and-chase system, paying providers first and investigating suspicious claims later. Federal authorities are using new technology designed to flag suspicious claims before they are paid, but the system still is relatively new.

While "frankly surprised" by his office's distinction as the per-capita leader in health-care fraud prosecutions, southern Illinois U.S. Attorney Stephen Wigginton said every U.S. attorney enjoys discretion in prioritizing which crime issues to combat, taking into account regional demographics and Holder's desires.

But Wigginton said he placed special emphasis on going after health-care defrauders since he began overseeing his district more than three years ago. Since then, Wigginton's office has increased such investigations each year. Last year, more than 30 people were indicted for allegedly scamming a Medicaid program meant to allow individuals to stay in their homes instead of entering a nursing home.

"I think we're very focused and strategic," said Wigginton, whose office also has taken a lead nationally in cracking down on fraudulent time-share marketing and the St. Louis region's increasing struggles with heroin use.


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