OIG: Fraud and abuse still occur despite efforts
OIG: Fraud and abuse still occur despite efforts
Efforts to root out fraud and abuse have made significant strides, says the Department of Health and Human Services’ Office of Inspector General (OIG), but there are startling stories of continued abuse that investigators have been unable to stop.
"I am particularly concerned about the deliberate fraud which we cannot always precisely measure, but [which] we know continues. We must never let down our guard, and we must continue to dedicate the resources and make the concerted effort to reduce those problems and continue to ensure the integrity of the Medicare program," John E. Hartwig, deputy inspector general for investigations, told the House Committee on Government Reforms Subcommittee on Govern-ment Management, Information, and Technology.
Hartwig told the subcommittee that claims data from 1995 through part of 1996 found a high percentage of the payments that were improper. OIG determined that many home health agencies (HHAs) shared characteristics that could undermine the investigator’s ability to recover overpayments or levy sanctions. What they found included:
• Improper billing and potential abuse. Hartwig retold of one egregious case involving
a south Florida home health agency. "We found that St. John’s billed Medicare for nonrendered or upcoded home health services, that nurses and home health aides permitted subcontracting groups to use their names and/or create fraudulent documents to support nonrendered services, and that some nursing visits were provided by unlicensed persons," Hartwig said. The OIG
also noted that subcontractors paid kickbacks
to St. John’s employees in order to do business with them, all of which led to 26 indictments for racketeering, conspiring to racketeer, conspiring to launder money, and conspiring to submit false claims against the Medicare program.
• Ghost employees and lack of medical credentials. A married couple, neither of whom had medical certification, portrayed themselves as physical therapists and even contracted with several home health agencies to provide services to beneficiaries. Hartwig said one of the subjects began her own HHA using ghost employees and assuming the identities of six licensed therapists, collecting more than $400,000.
Durable medical equipment (DME) continues to be an area where the OIG concentrates its anti-fraud and abuse efforts. After sampling 36 new durable medical equipment applicants in the Miami area, the Health Care Financing Admini-stration (HCFA) reported that 32 were not bona fide businesses, Hartwig says.
Bogus applicants did not have a physical address or an inventory of DME. According to HCFA, those companies should not have been issued a supplier number because they were not operational entities. To determine the prevalence of this problem, OIG sampled suppliers and applicants in 12 large metropolitan areas in New York, Florida, Texas, Illinois, and California. The inspection found that one of every 14 suppliers and one of every nine new applicants did not have a required physical address.
Services not rendered
OIG is still concerned about DME providers billing for services that were never rendered. Hartwig cited an example OIG uncovered in New York. The OIG investigated the case after numerous Medicare beneficiaries complained to their carriers that claims had been submitted for services that were not actually rendered. Those companies billed Medicare for millions in fraudulent claims. In one instance, three of the companies billing for ear implants received checks from Medicare totaling approximately $1 million in less than a month.
The DME providers’ bank became suspicious and called the carrier. This resulted in stopped payment on Medicare checks issued to the providers. Previously the carrier had placed a system alert on these companies when they had submitted fraudulent claims for MRI services. Because of the alert for improper MRI billings, the fictitious companies then began submitting claims for ear implants instead.
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