5 ms·

How to brazenly steal $100B from Medicare and Medicaid

82 points by latchkey 4y ago

cs702 4y ago
As the saying goes, $100B here, $100B there, and pretty soon we'll be talking about real money. More seriously, if the $100B estimate is accurate, all I can say is, wow.
- fwlr 4y ago
  The three-hit combo of “$100B in fraud”, “this is a conservative estimate and it’s way higher in reality”, and “Medicare and Medicaid are $900B each” really floored me. It’s 10% fraud!
  - alooPotato 4y ago
    Honestly 10% fraud doesn't seem that bad for a government program. I guess the real issue is how big the 90% is.
vsskanth 4y ago
One thing I don't see mentioned here is unnecessary surgeries being performed on elder patients. My wife was a home health OT for a small rural county. She was primarily doing post-op rehab at home. Recently, she noticed a lot of old patients on Medicare had shoulder replacement surgeries done on them, even though looking at their medical records it was clear it's either not necessary (won't improve their QOL) or simply shouldn't be done since it introduces other complications. Every time she encountered a similar case, she noticed it all traced back to a single doctor in the area. It was extremely sad to see old people end up in a much worse situation because of complications from their surgery, or pass away because they got sick in the hospital. All because some greedy doctor wanted to make more money. These old people place a lot of trust on their doctor and simply do what they ask without a second opinion.
- HDThoreaun 4y ago
  Old people vote the most and "death panel" rhetoric works really well. This is the result unfortunately. Overprescription is generally a huge problem in medicine because of asymmetric information and the incentive structure that fee for service creates. That's why medicare is trying to move to a capitated system in which health care providers get paid per patient they cover per year, not per service they provide.
  - toomuchtodo 4y ago
    A significant amount of healthcare spending is in the last year of life due to an unhealthy relationship with death at a cultural level. Until that changes, people will commit to exhausting healthcare and medical resources to cling on to the last part of life (note: I am not advocating for withholding care when a positive outcome is possible, and I have had to make end of life care decisions for loved ones). There is also evidence the system is incentivized to consume resources versus allowing someone to choose to die at home. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6610551/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6610551/ (Medicare Cost at End of Life) https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2708119/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2708119/ (Place of Death Among Older Americans) https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5326787/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5326787/ (Thanatophobia (Death Anxiety) in the Elderly: The Problem of the Child’s Inability to Assess Their Own Parent’s Death Anxiety State)
    - HDThoreaun 4y ago
      Good luck changing people's fear of death in this country. Properly disincentivizing interventions that don't work or aren't cost effective is the only solution.
      - s1artibartfast 4y ago
        I don't think you have to deal with incentives at all. We can simply stop paying for low or negative Roi treatments
latchkey 4y ago
Watching this felt like an advertisement for how to rob the government, and get away with it! Just don't base your company in Florida and you'll be all good since they only have 450 enforcement officers in the country (a whopping 9 per state)!
darth_avocado 4y ago
Why is it that when I pay 20$ less on my taxes, the IRS sends me a letter to make sure I pay the right amount, but when the government has to spend that money, $100B is not a big deal.
- voisin 4y ago
  Because taxes are meant to keep you as a serf.
  - black6 4y ago
    Yup. The income tax was fundamentally designed to prevent the accumulation of wealth.
    - dragonwriter 4y ago
      > The income tax was fundamentally designed to prevent the accumulation of wealth. Progressive income tax in the abstract was conceptualized to prevent the concentration (persistent inequality of distribution) of wealth, not its accumulation. The actual US implementation has been tuned very carefully to avoid doing even that, via (among other mechanisms) the preferential treatment of capital gains.
- jalk 4y ago
  Because very little human labor was involved in determining that you payed too little tax, but proving the fraud currently does
1024core 4y ago
My dad had diabetes, and I would order test strips for him from Amazon and ship them to his country of residence. Often times I'd get test strips marked for Medicare use, and sometimes the name of the person for whom they had been prescribed was also there. I reported it to Amazon once but never heard back from them.
Mortiffer 4y ago
If this $100B number were accurate I would expect a certain group of politicians to jump on it. The total Medicaid spend in 2021 was $734B . So that would mean 14% of Medicaid payments are fraud. This would mean you could simply take ~100 Medicaid bills at random from the whole country and have an agent go follow the money in detail and 14% of the time they would end up arresting someone ? Seems like this could easily self fund more agents if the numbers are true. Source: https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/nhe-fact-sheet https://www.cms.gov/research-statistics-data-and-systems/sta...
- lostmsu 4y ago
  > I would expect a certain group of politicians to jump on it Is discourse here so bad the Republican party can't be named?
  - kevingadd 4y ago
    With how aggressively they de -fang the IRS so it can't enforce white collar crime, it doesn't seem a given that they would want to spend tax dollars investigating and prosecuting this kind of white collar crime. They're more likely to just get rid of Medicare to cut costs.
    - WalterBright 4y ago
      As economist C Northcote Parkinson wrote, once taxes become high enough tax evasion inevitably becomes the national sport.
- htag 4y ago
  > The total Medicaid spend in 2021 was $734B . So that would mean 14% of Medicaid payments are fraud. The report indicates that the $100B/yr is between Medicaid and Medicare, which has a total spend of ~$1.6T, or roughly 6% are fraud.
- lostlogin 4y ago
  A similar line of thought applied to white collar crime and blue collar crime (eg tax fraud and social benefit fraud) also nets a similar conclusion. Why aren’t white collar crimes chased harder? https://www.wgtn.ac.nz/news/2017/08/why-is-tax-evasion-treated-more-gently-than-benefit-fraud2 https://www.wgtn.ac.nz/news/2017/08/why-is-tax-evasion-treat...
NickC25 4y ago
South Florida resident. I've come to realize that non-SoFla Floridians call Miami "Scamy Miami" for a reason. Before moving here, I had zero clue. Yeah, money laundering through real estate development was pretty known to me - because this is where the Latin American elite park their stolen gains, and that's been a thing for decades...but I was not prepared for what I've since discovered. The amount of fraud here is staggering. I've seen a number of "businesses" that range from questionable to highly suspect to outright blatant fraud in a number of different industries, mainly in real estate - but they all pale in comparison to the amount of straight-up scams that exist in the medical world that all seem to originate here. It's not limited by demographic either. I've seen people of all shapes, sizes, creeds, etc... in on this game, and they're all damn proud to be playing it. You see it in their luxury condos & homes, and their fancy cars that they get tricked out. You see it in their high-end clothes, their frequent dining out, and everything in-between. Fraud is the name of the game. Yet when you ask people what they do, you get a runaround, vague, BS filled answer. The lack of ethical or honest people around here is stunning. I'd leave but as a NY'er, the weather is just unbeatable.
- dashundchen 4y ago
  Hell, one of the two Senators for Florida, Rick Scott, was a founder and CEO of a company that was guilty of one of the largest healthcare fraud cases in US history, involving systematic fraudulent billing, unnecessary testing, bribes and fraudulent bookkeeping of Medicare. Somehow he got off by resigning as CEO, and went on to be elected governor and then senator of Florida. Absolutely mind-boggling that he seemed to face no personal consequences for the fraud. In fact, when he resigned he was paid out millions and granted hundreds of millions in stock by the board. https://www.justice.gov/archive/opa/pr/2003/June/03_civ_386.htm https://www.justice.gov/archive/opa/pr/2003/June/03_civ_386.... > Previously, on December 14, 2000, HCA subsidiaries pled guilty to substantial criminal conduct and paid more than $840 million in criminal fines, civil restitution and penalties. Combined with today's separate administrative settlement with the Centers for Medicare & Medicaid Services (CMS), under which HCA will pay an additional $250 million to resolve overpayment claims arising from certain of its cost reporting practices, the government will have recovered $1.7 billion from HCA, by far the largest recovery ever reached by the government in a health care fraud investigation. https://en.wikipedia.org/wiki/Rick_Scott https://en.wikipedia.org/wiki/Rick_Scott > Eight days after the initial raid, Scott signed his last SEC report as a hospital executive. Four months later, the board of directors pressured him to resign as chairman and CEO.[32] He was succeeded by Thomas F. Frist Jr.[33] Scott was paid $9.88 million in a settlement, and left owning 10 million shares of stock then worth more than $350 million
Mortiffer 4y ago
Another important question would be how does this fraud estimate compare to fraud for private insurances. Perhaps private insurances reject more claims and look in more detail but they don't have the ability to directly hire a police force like the Government managed version of insurance.
dzonga 4y ago
it's Florida. lived there for a couple of years. when Rick Scott - governor was chief fraudster. he made his billions defrauding medicare. now he's in the senate. what a life.
twoodfin 4y ago
This is a good estimate to remember when the argument is made that Medicare and Medicaid are superior to private payers because they have much lower administrative overhead. Yes, if you are willing to tolerate mid-single-digit fraud rates—cost billed to the taxpayer—you can indeed lower your administration burden.
- pnutjam 4y ago
  You know what, I'll take 6% fraud in place of 15% to 30% administrative costs. https://www.healthaffairs.org/do/10.1377/hpb20220909.830296/#:~:text=In%20a%202020%20publication%2C%20David,clinical%20documentation%20and%20coding%2C%20and https://www.healthaffairs.org/do/10.1377/hpb20220909.830296/... Too many people think they are being smart with money when in reality they are just being petty and wasteful.
  - twoodfin 4y ago
    Many of those costs are borne by Medicare/Medicaid as well as private payers: Costs from administrative activities are best defined as what is “left over” after accounting for clinical activities. The hospital president's salary is paid by Medicare/Medicaid, too. Same with the armies of medical coders.
    - pnutjam 4y ago
      Wait... I keep hearing that Medicaid/Medicare don't pay enough, now they are paying for all the overage stuff? Anyway, those quotes were for the internal management of the company, not the overhead at offices or hospitals.
  - rootusrootus 4y ago
    > You know what, I'll take 6% fraud in place of 15% to 30% administrative costs. Not to mention that private insurance companies aren't immune to fraud either.
chuckafir 4y ago
I used to work for a company whose primary line of business was providing analytical support for state Attorneys General with Medicare and Medicaid fraud trials. The biggest issues were, beyond a shadow of a doubt, known and established healthcare companies knowingly breaking the law: major pharmaceutical companies overcharging for prescription drugs, healthcare providers receiving kickbacks for prescribing drugs or medical devices, doctors upcoding procedures, etc. As fascinating as the criminals and schemes described in the article are, organizations created deliberately for fraud are not where the most fraud is occurring. It's large, "legitimate" businesses sucking at the blood of both their patients and the American taxpayers.
specialist 4y ago
Regulation is prone to capture. Procedures are prone to gamification. Courts are now pay to play. What to do? Part of the solution is a whistleblower & bounty program. Empowering 3rd parties to conduct investigation, oversight, and suing. I heard about a law firm that solely sues prescription management companies for fraud. The only income is from winning court decisions. (Sorry, I can't refind the link.) This could be a strategy to resurrect, revitalize local investigative journalism. Old timey broadsheet style publications backed by a good government law practice.
ck2 4y ago
Fun fact, the previous largest medicare fraud in history was done by the former governor of Florida and now Senator Rick Scott. Didn't slow down his career in the slightest.
renewiltord 4y ago
Americans don't know what corruption looks like because they're not familiar with it but it is pervasive here - made worse because it causes an American so much shame that he will reflexively attempt to deny it. Clever trick to make it part of the national psyche. It's amazing because San Francisco is really as or more corrupt than most Indian cities I've visited. The difference appears to be that while corruption steals the same $90 out of every $100 made, the sheer economic productivity of American cities permits them to still provide services. It's really an incredible sight.
- mrguyorama 4y ago
  Americans absolutely know what corruption and fraud looks like but the problem is that half of us seem to want to get in on it instead of fixing it. Look at MLMs, bitcoin, gambling, stock trading, americans are OBSESSED with get rich quick ideas. A lot of people's anger with 2008 seems to be, not that some people fleeced the general public, but rather that they themselves were not part of that group. Everyone seems to see life as a zero sum game where they can only improve by harming someone else first
WalterBright 4y ago
It goes far beyond outright fraud. Frontline did an episode a while back about dental centers being set up to provide free dental care for the poor. The government would reimburse them for the procedures provided. The dentists would prescribe all sorts of expensive procedures, like root canals, implants, etc., that were unnecessary for the patients, and collect the payments from the government. Frontline was suitably shocked by this behavior, but what does one expect to happen when the government sets up a machine that dispenses gold coins when the button is pushed? People are gonna push that button till their arm falls off, and then they'll push the button with their nose. This goes on because nobody in government actually cares about the losses. After all, it's somebody else's money. In business, when this happens, the business owner does something about it. For example, the cash register was invented by a bar owner who realized that his busy bar was losing money because the bartenders were pocketing most of the revenue.
balderdash 4y ago
I’m far from an anti-tax extremist, but it’s hard to read articles like this (that appear every year or two) and not be frustrated at calls to raise taxes in the same news cycle, when there is clearly so much abuse and waste in the system, that if largely eliminated would pay for so much! (E.g. eliminating $90b of fraud in Medicare, would allow for a 5% increase in discretionary spending across the board, without looking to the taxpayer!) https://en.m.wikipedia.org/wiki/United_States_federal_budget https://en.m.wikipedia.org/wiki/United_States_federal_budget
- throwaway173738 4y ago
  If you’d read the rest of the article, the reason there is a lot of uninvestigated fraud is because there isn’t currently funding to pay for enough investigators to drive around places like south florida. In the same vein I’d gladly pay the extra $20/year or so to let the IRS staff up enough that it doesn’t take them 8 months to deposit a check and release my tax return.
  - costco 4y ago
    I don't get why haven't they just hired more fraud investigators and people to recover proceeds then? It is laughable that the government only started to even remotely acknowledge the Medicare fraud issue in the 2000s. We are talking about tens of billions of dollars stolen every year for the past 30+ years. There are prosecutions but only in a fraction of cases because there are simply so many of them. You could even have something like the NYC Marshal system where they get a % of everything they recover. It's not hard to find pharmacies that 80% of the time prescribe expensive compounded medications that are incredibly rare in the real world or "telemedicine" doctors who are signing off on hundreds of prescriptions a day.

82 points by latchkey 4y ago

As the saying goes, $100B here, $100B there, and pretty soon we'll be talking about real money. More seriously, if the $100B estimate is accurate, all I can say is, wow.

fwlr 4y ago
The three-hit combo of “$100B in fraud”, “this is a conservative estimate and it’s way higher in reality”, and “Medicare and Medicaid are $900B each” really floored me. It’s 10% fraud!
- alooPotato 4y ago
  Honestly 10% fraud doesn't seem that bad for a government program. I guess the real issue is how big the 90% is.

vsskanth 4y ago

One thing I don't see mentioned here is unnecessary surgeries being performed on elder patients. My wife was a home health OT for a small rural county. She was primarily doing post-op rehab at home. Recently, she noticed a lot of old patients on Medicare had shoulder replacement surgeries done on them, even though looking at their medical records it was clear it's either not necessary (won't improve their QOL) or simply shouldn't be done since it introduces other complications. Every time she encountered a similar case, she noticed it all traced back to a single doctor in the area. It was extremely sad to see old people end up in a much worse situation because of complications from their surgery, or pass away because they got sick in the hospital. All because some greedy doctor wanted to make more money. These old people place a lot of trust on their doctor and simply do what they ask without a second opinion.

HDThoreaun 4y ago
Old people vote the most and "death panel" rhetoric works really well. This is the result unfortunately. Overprescription is generally a huge problem in medicine because of asymmetric information and the incentive structure that fee for service creates. That's why medicare is trying to move to a capitated system in which health care providers get paid per patient they cover per year, not per service they provide.
- toomuchtodo 4y ago
  A significant amount of healthcare spending is in the last year of life due to an unhealthy relationship with death at a cultural level. Until that changes, people will commit to exhausting healthcare and medical resources to cling on to the last part of life (note: I am not advocating for withholding care when a positive outcome is possible, and I have had to make end of life care decisions for loved ones). There is also evidence the system is incentivized to consume resources versus allowing someone to choose to die at home. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6610551/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC6610551/ (Medicare Cost at End of Life) https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2708119/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2708119/ (Place of Death Among Older Americans) https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5326787/ https://www.ncbi.nlm.nih.gov/pmc/articles/PMC5326787/ (Thanatophobia (Death Anxiety) in the Elderly: The Problem of the Child’s Inability to Assess Their Own Parent’s Death Anxiety State)
  - HDThoreaun 4y ago
    Good luck changing people's fear of death in this country. Properly disincentivizing interventions that don't work or aren't cost effective is the only solution.
    - s1artibartfast 4y ago
      I don't think you have to deal with incentives at all. We can simply stop paying for low or negative Roi treatments

latchkey 4y ago

Watching this felt like an advertisement for how to rob the government, and get away with it! Just don't base your company in Florida and you'll be all good since they only have 450 enforcement officers in the country (a whopping 9 per state)!

darth_avocado 4y ago

Why is it that when I pay 20$ less on my taxes, the IRS sends me a letter to make sure I pay the right amount, but when the government has to spend that money, $100B is not a big deal.

voisin 4y ago
Because taxes are meant to keep you as a serf.
- black6 4y ago
  Yup. The income tax was fundamentally designed to prevent the accumulation of wealth.
  - dragonwriter 4y ago
    > The income tax was fundamentally designed to prevent the accumulation of wealth. Progressive income tax in the abstract was conceptualized to prevent the concentration (persistent inequality of distribution) of wealth, not its accumulation. The actual US implementation has been tuned very carefully to avoid doing even that, via (among other mechanisms) the preferential treatment of capital gains.
jalk 4y ago
Because very little human labor was involved in determining that you payed too little tax, but proving the fraud currently does

1024core 4y ago

My dad had diabetes, and I would order test strips for him from Amazon and ship them to his country of residence. Often times I'd get test strips marked for Medicare use, and sometimes the name of the person for whom they had been prescribed was also there. I reported it to Amazon once but never heard back from them.

Mortiffer 4y ago

If this $100B number were accurate I would expect a certain group of politicians to jump on it. The total Medicaid spend in 2021 was $734B . So that would mean 14% of Medicaid payments are fraud. This would mean you could simply take ~100 Medicaid bills at random from the whole country and have an agent go follow the money in detail and 14% of the time they would end up arresting someone ? Seems like this could easily self fund more agents if the numbers are true. Source: https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/nationalhealthexpenddata/nhe-fact-sheet https://www.cms.gov/research-statistics-data-and-systems/sta...

lostmsu 4y ago
> I would expect a certain group of politicians to jump on it Is discourse here so bad the Republican party can't be named?
- kevingadd 4y ago
  With how aggressively they de -fang the IRS so it can't enforce white collar crime, it doesn't seem a given that they would want to spend tax dollars investigating and prosecuting this kind of white collar crime. They're more likely to just get rid of Medicare to cut costs.
  - WalterBright 4y ago
    As economist C Northcote Parkinson wrote, once taxes become high enough tax evasion inevitably becomes the national sport.
htag 4y ago
> The total Medicaid spend in 2021 was $734B . So that would mean 14% of Medicaid payments are fraud. The report indicates that the $100B/yr is between Medicaid and Medicare, which has a total spend of ~$1.6T, or roughly 6% are fraud.
lostlogin 4y ago
A similar line of thought applied to white collar crime and blue collar crime (eg tax fraud and social benefit fraud) also nets a similar conclusion. Why aren’t white collar crimes chased harder? https://www.wgtn.ac.nz/news/2017/08/why-is-tax-evasion-treated-more-gently-than-benefit-fraud2 https://www.wgtn.ac.nz/news/2017/08/why-is-tax-evasion-treat...

NickC25 4y ago

South Florida resident. I've come to realize that non-SoFla Floridians call Miami "Scamy Miami" for a reason. Before moving here, I had zero clue. Yeah, money laundering through real estate development was pretty known to me - because this is where the Latin American elite park their stolen gains, and that's been a thing for decades...but I was not prepared for what I've since discovered. The amount of fraud here is staggering. I've seen a number of "businesses" that range from questionable to highly suspect to outright blatant fraud in a number of different industries, mainly in real estate - but they all pale in comparison to the amount of straight-up scams that exist in the medical world that all seem to originate here. It's not limited by demographic either. I've seen people of all shapes, sizes, creeds, etc... in on this game, and they're all damn proud to be playing it. You see it in their luxury condos & homes, and their fancy cars that they get tricked out. You see it in their high-end clothes, their frequent dining out, and everything in-between. Fraud is the name of the game. Yet when you ask people what they do, you get a runaround, vague, BS filled answer. The lack of ethical or honest people around here is stunning. I'd leave but as a NY'er, the weather is just unbeatable.

dashundchen 4y ago
Hell, one of the two Senators for Florida, Rick Scott, was a founder and CEO of a company that was guilty of one of the largest healthcare fraud cases in US history, involving systematic fraudulent billing, unnecessary testing, bribes and fraudulent bookkeeping of Medicare. Somehow he got off by resigning as CEO, and went on to be elected governor and then senator of Florida. Absolutely mind-boggling that he seemed to face no personal consequences for the fraud. In fact, when he resigned he was paid out millions and granted hundreds of millions in stock by the board. https://www.justice.gov/archive/opa/pr/2003/June/03_civ_386.htm https://www.justice.gov/archive/opa/pr/2003/June/03_civ_386.... > Previously, on December 14, 2000, HCA subsidiaries pled guilty to substantial criminal conduct and paid more than $840 million in criminal fines, civil restitution and penalties. Combined with today's separate administrative settlement with the Centers for Medicare & Medicaid Services (CMS), under which HCA will pay an additional $250 million to resolve overpayment claims arising from certain of its cost reporting practices, the government will have recovered $1.7 billion from HCA, by far the largest recovery ever reached by the government in a health care fraud investigation. https://en.wikipedia.org/wiki/Rick_Scott https://en.wikipedia.org/wiki/Rick_Scott > Eight days after the initial raid, Scott signed his last SEC report as a hospital executive. Four months later, the board of directors pressured him to resign as chairman and CEO.[32] He was succeeded by Thomas F. Frist Jr.[33] Scott was paid $9.88 million in a settlement, and left owning 10 million shares of stock then worth more than $350 million

Mortiffer 4y ago

Another important question would be how does this fraud estimate compare to fraud for private insurances. Perhaps private insurances reject more claims and look in more detail but they don't have the ability to directly hire a police force like the Government managed version of insurance.

dzonga 4y ago

it's Florida. lived there for a couple of years. when Rick Scott - governor was chief fraudster. he made his billions defrauding medicare. now he's in the senate. what a life.

twoodfin 4y ago

This is a good estimate to remember when the argument is made that Medicare and Medicaid are superior to private payers because they have much lower administrative overhead. Yes, if you are willing to tolerate mid-single-digit fraud rates—cost billed to the taxpayer—you can indeed lower your administration burden.

pnutjam 4y ago
You know what, I'll take 6% fraud in place of 15% to 30% administrative costs. https://www.healthaffairs.org/do/10.1377/hpb20220909.830296/#:~:text=In%20a%202020%20publication%2C%20David,clinical%20documentation%20and%20coding%2C%20and https://www.healthaffairs.org/do/10.1377/hpb20220909.830296/... Too many people think they are being smart with money when in reality they are just being petty and wasteful.
- twoodfin 4y ago
  Many of those costs are borne by Medicare/Medicaid as well as private payers: Costs from administrative activities are best defined as what is “left over” after accounting for clinical activities. The hospital president's salary is paid by Medicare/Medicaid, too. Same with the armies of medical coders.
  - pnutjam 4y ago
    Wait... I keep hearing that Medicaid/Medicare don't pay enough, now they are paying for all the overage stuff? Anyway, those quotes were for the internal management of the company, not the overhead at offices or hospitals.
- rootusrootus 4y ago
  > You know what, I'll take 6% fraud in place of 15% to 30% administrative costs. Not to mention that private insurance companies aren't immune to fraud either.

chuckafir 4y ago

I used to work for a company whose primary line of business was providing analytical support for state Attorneys General with Medicare and Medicaid fraud trials. The biggest issues were, beyond a shadow of a doubt, known and established healthcare companies knowingly breaking the law: major pharmaceutical companies overcharging for prescription drugs, healthcare providers receiving kickbacks for prescribing drugs or medical devices, doctors upcoding procedures, etc. As fascinating as the criminals and schemes described in the article are, organizations created deliberately for fraud are not where the most fraud is occurring. It's large, "legitimate" businesses sucking at the blood of both their patients and the American taxpayers.

specialist 4y ago

Regulation is prone to capture. Procedures are prone to gamification. Courts are now pay to play. What to do? Part of the solution is a whistleblower & bounty program. Empowering 3rd parties to conduct investigation, oversight, and suing. I heard about a law firm that solely sues prescription management companies for fraud. The only income is from winning court decisions. (Sorry, I can't refind the link.) This could be a strategy to resurrect, revitalize local investigative journalism. Old timey broadsheet style publications backed by a good government law practice.

ck2 4y ago

Fun fact, the previous largest medicare fraud in history was done by the former governor of Florida and now Senator Rick Scott. Didn't slow down his career in the slightest.

renewiltord 4y ago

Americans don't know what corruption looks like because they're not familiar with it but it is pervasive here - made worse because it causes an American so much shame that he will reflexively attempt to deny it. Clever trick to make it part of the national psyche. It's amazing because San Francisco is really as or more corrupt than most Indian cities I've visited. The difference appears to be that while corruption steals the same $90 out of every $100 made, the sheer economic productivity of American cities permits them to still provide services. It's really an incredible sight.

mrguyorama 4y ago
Americans absolutely know what corruption and fraud looks like but the problem is that half of us seem to want to get in on it instead of fixing it. Look at MLMs, bitcoin, gambling, stock trading, americans are OBSESSED with get rich quick ideas. A lot of people's anger with 2008 seems to be, not that some people fleeced the general public, but rather that they themselves were not part of that group. Everyone seems to see life as a zero sum game where they can only improve by harming someone else first

WalterBright 4y ago

It goes far beyond outright fraud. Frontline did an episode a while back about dental centers being set up to provide free dental care for the poor. The government would reimburse them for the procedures provided. The dentists would prescribe all sorts of expensive procedures, like root canals, implants, etc., that were unnecessary for the patients, and collect the payments from the government. Frontline was suitably shocked by this behavior, but what does one expect to happen when the government sets up a machine that dispenses gold coins when the button is pushed? People are gonna push that button till their arm falls off, and then they'll push the button with their nose. This goes on because nobody in government actually cares about the losses. After all, it's somebody else's money. In business, when this happens, the business owner does something about it. For example, the cash register was invented by a bar owner who realized that his busy bar was losing money because the bartenders were pocketing most of the revenue.

balderdash 4y ago

I’m far from an anti-tax extremist, but it’s hard to read articles like this (that appear every year or two) and not be frustrated at calls to raise taxes in the same news cycle, when there is clearly so much abuse and waste in the system, that if largely eliminated would pay for so much! (E.g. eliminating $90b of fraud in Medicare, would allow for a 5% increase in discretionary spending across the board, without looking to the taxpayer!) https://en.m.wikipedia.org/wiki/United_States_federal_budget https://en.m.wikipedia.org/wiki/United_States_federal_budget

throwaway173738 4y ago
If you’d read the rest of the article, the reason there is a lot of uninvestigated fraud is because there isn’t currently funding to pay for enough investigators to drive around places like south florida. In the same vein I’d gladly pay the extra $20/year or so to let the IRS staff up enough that it doesn’t take them 8 months to deposit a check and release my tax return.
- costco 4y ago
  I don't get why haven't they just hired more fraud investigators and people to recover proceeds then? It is laughable that the government only started to even remotely acknowledge the Medicare fraud issue in the 2000s. We are talking about tens of billions of dollars stolen every year for the past 30+ years. There are prosecutions but only in a fraction of cases because there are simply so many of them. You could even have something like the NYC Marshal system where they get a % of everything they recover. It's not hard to find pharmacies that 80% of the time prescribe expensive compounded medications that are incredibly rare in the real world or "telemedicine" doctors who are signing off on hundreds of prescriptions a day.