government
Medicare gears up for strict anti-fraud campaign
■ Improper payments hit $48 billion in 2010, but physicians are considered low risk.
By Charles Fiegl — Posted March 14, 2011
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Washington -- Federal officials visited Capitol Hill this month to promote plans for tough new anti-fraud measures for Medicare, targeting the estimated tens of billions of dollars in improper payments the program makes each year.
The health system reform law included new powers to strengthen the Centers for Medicare & Medicaid Services' programs targeting fraud, waste and abuse, said Peter Budetti, MD, CMS deputy administrator and director of the agency's Center for Program Integrity. These changes include stricter screening and enrollment procedures for health professionals, the ability to stop payment of suspect claims and more funding to investigate fraud.
The safeguards come when Medicare is considered a "high-risk program," according to a March assessment by the Government Accountability Office. In 2010, the Medicare agency estimated that its total improper payments amounted to $48 billion, or 9.4% of total outlays. The GAO says the new tools will be critical in helping reduce these improper payments.
Testifying before the House Ways and Means oversight subcommittee on March 2, one of three congressional hearings that day on the issue, Dr. Budetti said his agency is moving from a "pay-and-chase" approach to fraud to a "prevention-and-detection" approach. He credited the health system reform law with providing front-end protections to deter waste and abusive claims practices.
Physicians are considered to be a relatively low risk to the program in terms of committing Medicare fraud, according to CMS. Newly enrolled medical equipment and home health vendors are considered to be much higher on the risk scale.
Rep. Charles Boustany, MD (R, La.), asked what physicians can do to help identify fraud. He was questioning Dr. Budetti and Lewis Morris, chief counsel with the Dept. of Health and Human Services Office of Inspector General. Both officials discussed the importance of education and creating more physician awareness about fraudulent activities, such as identity theft. Dr. Budetti also said his department will hire a full-time medical officer to work with physicians on program integrity issues.
"Medicare crooks are robbing the American taxpayer each and every year of the same amount it took Bernie Madoff decades to rob from his private investors," said Dr. Boustany, a cardiothoracic surgeon. "Medicare fraud has become such an attractive target for criminals that the FBI and OIG have seen an increasing number of foreign criminal groups coming to America to exploit the program because it's less risky and a lot more lucrative than other illegal ventures."
Members of the subcommittee heard from Aghaegbuna "Ike" Odelugo, a Nigerian immigrant who stole $9.93 million from the Medicare program from 2005 to 2008. Odelugo was convicted of health care fraud, conspiracy and money laundering in August 2010. He used 14 front companies in 11 states to bill Medicare fraudulently for orthotics, lymph edema pumps and power wheelchairs.
Odelugo is working with the federal government while he awaits sentencing this year. He told lawmakers that medical equipment fraud is extremely easy to commit.
"The primary skill required to do it successfully is knowledge of basic data entry on a computer," Odelugo said.
New screening measures are aimed at preventing the kind of fraud Odelugo used to bilk millions from the program. For instance, data mining and analytics can better detect improper claims and billing schemes. Spikes in billing of a service in a specific area would raise a red flag. CMS is testing the technology "to ensure a low rate of false positives, allowing payment of claims to legitimate providers without disruption or additional cost to honest providers," Dr. Budetti said.
American Medical Association President Cecil B. Wilson, MD, hailed the new CMS efforts, saying physicians take Medicare fraud and identity theft very seriously.
"The AMA supports CMS' targeted fraud detection efforts and the use of enhanced data tools and screening methods to detect fraud without burdening the vast majority of physicians who are not involved in Medicare fraud," Dr. Wilson said. "The AMA is pleased that CMS' newly issued enrollment screening rules place physicians in the lowest category of risk."