Health Care Scare: Democrat plan the gateway to corruption, say critics

The following is part of the continuing coverage of the health care debate by Jim Kouri for NewswithViews.com.

While millions of Americans watched President Barack Obama sell his national health care plan on nationwide television on September 9, he told members of both houses of Congress and all Americans that his plan would be paid for by reducing fraud, abuse and waste. 

With the Obama Administration and Democrat leaders in both houses of the US Congress desperately pushing a major overhaul -- many say government takeover -- of US health care, a report obtained by NewswithViews.com's Jim Kouri shed light on the fraud and corruption already existing in government-run medical programs.

"There are billions and billions of dollars -- taxpayer dollars -- that are literally stolen every year and the government leaders know it's happening. However, it's easier to just increase taxes or decrease benefits than it is to go after criminals within the US and local governments," said political strategist Mike Baker.

“If stopping government fraud and abuse is so easy, why don’t these politicians stop it now?” he asked. 

According to Steven Malanga of the Manhattan Institute, experts estimate that "abuses of Medicaid (alone) eat up at least 10 percent of the program’s total cost nationwide -- a waste of $30 billion a year. Unscrupulous doctors billing for over 24 hours per day of procedures, phony companies invoicing for phantom services, pharmacists filling prescriptions for dead patients, home health-care companies demanding payment for treating clients actually in the hospital -- on and on the rip-offs go." 

The cheating is brazen because scam artists have figured out that years of lax oversight have made Medicaid easy plunder, according to Malanga.

On April 22, 2009, Government Accountability Office officials testified before an ad-hoc Congressional subcommittee at a hearing entitled, "Eliminating Waste and Fraud in Medicare and Medicaid." 

In a subsequent letter responding to a May 29, 2009 request for responses to questions for the record related to the April 22, 2009, testimony, the GAO responded to the following questions:  What do you see as the biggest challenge for Centers for Medicare/Medicaid Services (CMS) to provide an estimate for improper payments under Medicare Part D? Has GAO identified any problems with the current process for reviewing and paying Medicare claims that would make the program more vulnerable to fraudulent claims?  Is there any reason the US federal agency which administers Medicare, Medicaid, and the Children's Health Insurance Program cannot include penalties in its Medicare Administrative Contractor contracts for paying improper or fraudulent claims that they are aware of?

With total outlays of about $46 billion in fiscal year 2008, Medicare Part D is the last significant part of Medicare for which the department has yet to develop an estimate of improper payments. In developing its estimate, it will be important for CMS to determine where the vulnerabilities and risks exist in the Medicare Part D structure and operations that could impact CMS's ability to effectively detect, measure, and ultimately reduce improper payments.

In HHS's fiscal year 2008 AFR, the department reported that it had calculated payment error rates for two components of Medicare Part D but also that its measurement was not fully implemented. Also, it will be important to consider Health and Human Services' Office of Inspector General identified concerns about CMS's implementation of internal controls to ensure payment accuracy as well as inadequate analysis of claims data. 

The GAO investigation identified several weaknesses with the current process for reviewing Medicare claims. Limitations in the number of medical reviews conducted leave the home health benefit -- within the Medicare program -- vulnerable to improper payments, including payments resulting from fraud and abuse.

In previous studies, the GAO reported in February 2009 that in fiscal year 2007, only 0.5 percent of the more than 8.7 million home health agency (HHA) claims processed were subjected to prepayment review by Medicare's contractors.

The contractors focused primarily on claims submitted by HHAs whose billing patterns differed from their peers on measures such as cost per episode. Of those claims that were reviewed, over 40 percent were denied in whole or in part. There are also weaknesses with respect to selecting claims to review in Medicare Fee-for-Service.

"When you study the history of fraud and abuse within a program the size of Medicare/Medicaid you can only imagine how much more money will be stolen by taxpayers in a program as huge as Universal Health Care. Can you imagine a trillion dollars stolen from the American people in the name of medical care?" asks Mike Baker.

In addition to the weaknesses with the current Medicare claims review process, analysts found that failure to effectively screen health providers before granting them billing billing privileges also increases the program's vulnerability to fraudulent claims.

Consistent with the Social Security Act and applicable federal procurement regulations, CMS may include provisions in Medicare Administrative Contractor (MAC) contracts to:  prescribe the costs incurred by MACs in processing and paying Medicare claims that CMS may reimburse;  provide incentives or disincentives related to payment accuracy; and hold MACs and their employees liable for improper or fraudulent claims payments under limited circumstances.

Otherwise, neither the Social Security Act nor applicable federal procurement regulations expressly provides for CMS to reduce amounts owed to MACs under their contracts or to assess charges against MACs for improper or fraudulent claims payments.

Opponents of the plan currently considered by the US Congress -- commonly known as ObamaCare -- believe that if the US government succeeds in taking control of the health care industry, losses due to fraud and abuse will drastically increase.