Historic Medicare Fraud Bust
Over 100 Charged in Multi-State Sweep
By: Justin Vaughn, M.Div, CPC
Director of Compliance

February 18, 2011

According to an Associated Press (AP) story released yesterday, more than 700 federal officials in several states moved in concert on Thursday to indict 111 physicians and other providers on charges of Medicare fraud—making it the largest healthcare-related round-up in history.  The medical providers were said to have bilked the government out of $250 million in false claims.  Significantly, this bust comes just 2 days after another federal action arrested 21 providers on charges of $200 million in fraudulent Medicare claims.

The AP story asserted that such busts are a key component in the government’s strategy to pay for President Obama’s healthcare overhaul.  Toward that end, Health and Human Services Secretary Kathleen Sebelius and Attorney General Eric Holder have worked in tandem to target what they believe to be “fraud hot spots.” These include Miami, Los Angeles, Dallas, Houston, Detroit, Chicago, Brooklyn, Tampa, and Baton Rouge—with Dallas and Chicago said to receive even greater scrutiny in the months ahead.

Though the AP story did not specify whether or not anesthesiology providers were part of the government sweep, our clients and partners should certainly be sobered by these latest developments.  It’s clear that we find ourselves in a new era of enforcement; and while we all want to see true criminal activity prevented and prosecuted, there is some concern that a potentially over-zealous, overreaching government may ensnare the good with the bad.  The FBI agent in charge of Thursday’s action has called for criminal background checks and fingerprinting of all healthcare providers, and Secretary Sebelius has promised “more decisive action” by aggressively screening providers and “stopping payment to suspicious ones, under greater authority granted by the Affordable Care Act.”

While greater government action to avert fraud is no doubt needed, there is the potential for government abuse in this process.  Accordingly, I strongly recommend that your group implement policies to prevent the inspector’s magnifying glass from being turned in your direction.  Make sure you have a compliance plan that is current and that contains strong measures addressing compliance risk areas in your practice.

The information presented herein reflects general information that is current as of the date it was first published.  In light of changes that may occur in the health care regulatory and compliance environments, the author's presentation of this information might become outdated.  Please check with your individual legal and/or compliance advisor(s) prior to taking any significant actions based upon the information and advice presented.