Health Care Fraud


A lot of us subscribe to on-line news letters, blogs and such. I am no different. One news release site I subscribe to is from the Federal Bureau of Investigation (FBI). It always makes me feel a little better when I hear about bad guys being indicted, getting caught, and sentenced. Over the past year of so that I have been receiving these news releases it has struck me that at least four or five times a week there is an item about someone being charged or sentenced for health care fraud. The latest example is about a “Wheelchair Company, Its Owner and Physician Sentenced for Health Care Fraud.” Just today there were three news releases about such cases. Two more are: “Michigan Clinic Owner Pleads Guilty in Massive Medicare Fraud Scheme;” and “Florida Man Sentenced for Money Laundering Related to Health Care Fraud.” The good news is that some of the bad guys are being discovered and caught, but how many are getting away with their nefarious activities?

My first thought is that these cretins are stealing from us, the taxpayers of the country. While this is certainly true, this crime needs to be viewed from another aspect. What makes this type of crime so common is the ease with which the criminals are able to manipulate the public health care systems of Medicare and Medicaid. It is my contention that this is possible because these bloated and completely broken programs are being run by career bureaucrats who are not staying on top of their responsibilities.

These bureaucrats are able to get away with incompetence because the system allows them to. I have no doubt these programs were established with the best intentions, but where are the checks and balances to keep this type of fraud from taking place? Has there ever been a top-to-bottom review to try to discover if industry best practices are being employed?

The bottom line of this discussion is that every program established by the federal government is riddled with efficient management that comes from bureaucratic bloat. Medicare and Medicaid are only two broken and mismanaged programs in a long line. The during the Johnson administration the feds decided that all the money in the Social Security system was just what they needed to increase social programs under the war on poverty, part of the Great Society.

The US Post Office has continued to operate much as it has for the last 200 years. It is common for commercial businesses to look for new and innovative ways to improve their business processes. This is a concept that seems to have been lost on the US Post Office. Not only are they unable to operate efficiently, they seem to have little interest in looking for ways to improve their operations. Consequently, they have been eclipsed by UPS and FEDEX.

Now, the federal government is intent on taking the best health care system in the world and put it into the same category as Medicare and Medicaid. That is the category of failed programs. Never mind the fact that there is no place in the Constitution that gives the feds the authorization to even address medical care. Speaker Pelosi, Senator Reid, and the OWH are determined to establish a health care system under their direct control. What I find especially sad is that with the feds abysmal record at running programs we are likely to see our health system reduced to the status of a third world country.

With an increase in bureaucracy, there is a corresponding increase in propensity for corruption. Looking at the proposed health care legislation as it currently is proposed in the House of Representatives, the House Republican Conference has compiled a list of new federal bureaucracies that would be established by that 2000 page tome. They add up to 111 new organizations. They are listed below with the section and page number from the bill.

1. Retiree Reserve Trust Fund (Section 111(d), p. 61)
2. Grant program for wellness programs to small employers (Section 112, p. 62)
3. Grant program for State health access programs (Section 114, p. 72)
4. Program of administrative simplification (Section 115, p. 76)
5. Health Benefits Advisory Committee (Section 223, p. 111)
6. Health Choices Administration (Section 241, p. 131)
7. Qualified Health Benefits Plan Ombudsman (Section 244, p. 138)
8. Health Insurance Exchange (Section 201, p. 155)
9. Program for technical assistance to employees of small businesses buying Exchange coverage (Section 305(h), p. 191)
10. Mechanism for insurance risk pooling to be established by Health Choices Commissioner (Section 306(b), p. 194)
11. Health Insurance Exchange Trust Fund (Section 307, p. 195)
12. State-based Health Insurance Exchanges (Section 308, p. 197)
13. Grant program for health insurance cooperatives (Section 310, p. 206)
14. “Public Health Insurance Option” (Section 321, p. 211)
15. Ombudsman for “Public Health Insurance Option” (Section 321(d), p. 213)
16. Account for receipts and disbursements for “Public Health Insurance Option” (Section 322(b), p. 215)
17. Telehealth Advisory Committee (Section 1191 (b), p. 589)
18. Demonstration program providing reimbursement for “culturally and linguistically appropriate services” (Section 1222, p. 617)
19. Demonstration program for shared decision making using patient decision aids (Section 1236, p. 648)
20. Accountable Care Organization pilot program under Medicare (Section 1301, p. 653)
21. Independent patient-centered medical home pilot program under Medicare (Section 1302, p. 672)
22. Community-based medical home pilot program under Medicare (Section 1302(d), p. 681)
23. Independence at home demonstration program (Section 1312, p. 718)
24. Center for Comparative Effectiveness Research (Section 1401(a), p. 734)
25. Comparative Effectiveness Research Commission (Section 1401(a), p. 738)
26. Patient ombudsman for comparative effectiveness research (Section 1401(a), p. 753)
27. Quality assurance and performance improvement program for skilled nursing facilities (Section 1412(b)(1), p. 784)
28. Quality assurance and performance improvement program for nursing facilities (Section 1412 (b)(2), p. 786)
29. Special focus facility program for skilled nursing facilities (Section 1413(a)(3), p. 796)
30. Special focus facility program for nursing facilities (Section 1413(b)(3), p. 804)
31. National independent monitor pilot program for skilled nursing facilities and nursing facilities (Section 1422, p. 859)
32. Demonstration program for approved teaching health centers with respect to Medicare GME (Section 1502(d), p. 933)
33. Pilot program to develop anti-fraud compliance systems for Medicare providers (Section 1635, p. 978)
34. Special Inspector General for the Health Insurance Exchange (Section 1647, p. 1000)
35. Medical home pilot program under Medicaid (Section 1722, p. 1058)
36. Accountable Care Organization pilot program under Medicaid (Section 1730A, p. 1073)
37. Nursing facility supplemental payment program (Section 1745, p. 1106)
38. Demonstration program for Medicaid coverage to stabilize emergency medical conditions in institutions for mental diseases (Section 1787, p. 1149)
39. Comparative Effectiveness Research Trust Fund (Section 1802, p. 1162)
40. “Identifiable office or program” within CMS to “provide for improved
coordination between Medicare and Medicaid in the case of dual eligibles” (Section 1905, p. 1191)
41. Center for Medicare and Medicaid Innovation (Section 1907, p. 1198)
42. Public Health Investment Fund (Section 2002, p. 1214)
43. Scholarships for service in health professional needs areas (Section 2211, p. 1224)
44. Program for training medical residents in community-based settings (Section 2214, p. 1236)
45. Grant program for training in dentistry programs (Section 2215, p. 1240)
46. Public Health Workforce Corps (Section 2231, p. 1253)
47. Public health workforce scholarship program (Section 2231, p. 1254)
48. Public health workforce loan forgiveness program (Section 2231, p. 1258)
49. Grant program for innovations in interdisciplinary care (Section 2252, p. 1272)
50. Advisory Committee on Health Workforce Evaluation and Assessment (Section 2261, p. 1275)
51. Prevention and Wellness Trust (Section 2301, p. 1286)
52. Clinical Prevention Stakeholders Board (Section 2301, p. 1295)
53. Community Prevention Stakeholders Board (Section 2301, p. 1301)
54. Grant program for community prevention and wellness research (Section 2301, p. 1305)
55. Grant program for research and demonstration projects related to wellness incentives (Section 2301, p. 1305)
56. Grant program for community prevention and wellness services (Section 2301, p. 1308)
57. Grant program for public health infrastructure (Section 2301, p. 1313)
58. Center for Quality Improvement (Section 2401, p. 1322)
59. Assistant Secretary for Health Information (Section 2402, p. 1330)
60. Grant program to support the operation of school-based health clinics (Section 2511, p. 1352)
61. Grant program for nurse-managed health centers (Section 2512, p. 1361)
62. Grants for labor-management programs for nursing training (Section 2521, p. 1372)
63. Grant program for interdisciplinary mental and behavioral health training (Section 2522, p. 1382)
64. “No Child Left Unimmunized Against Influenza” demonstration grant program (Section 2524, p. 1391)
65. Healthy Teen Initiative grant program regarding teen pregnancy (Section 2526, p. 1398)
66. Grant program for interdisciplinary training, education, and services for individuals with autism (Section 2527(a), p. 1402)
67. University centers for excellence in developmental disabilities education (Section 2527(b), p. 1410)
68. Grant program to implement medication therapy management services (Section 2528, p. 1412)
69. Grant program to promote positive health behaviors in underserved communities (Section 2530, p. 1422)
70. Grant program for State alternative medical liability laws (Section 2531, p. 1431)
71. Grant program to develop infant mortality programs (Section 2532, p. 1433)
72. Grant program to prepare secondary school students for careers in health professions (Section 2533, p. 1437)
73. Grant program for community-based collaborative care (Section 2534, p. 1440)
74. Grant program for community-based overweight and obesity prevention (Section 2535, p. 1457)
75. Grant program for reducing the student-to-school nurse ratio in primary and secondary schools (Section 2536, p. 1462)
76. Demonstration project of grants to medical-legal partnerships (Section 2537, p. 1464)
77. Center for Emergency Care under the Assistant Secretary for Preparedness and Response (Section 2552, p. 1478)
78. Council for Emergency Care (Section 2552, p 1479)
79. Grant program to support demonstration programs that design and implement regionalized emergency care systems (Section 2553, p. 1480)
80. Grant program to assist veterans who wish to become emergency medical technicians upon discharge (Section 2554, p. 1487)
81. Interagency Pain Research Coordinating Committee (Section 2562, p. 1494)
82. National Medical Device Registry (Section 2571, p. 1501)
83. CLASS Independence Fund (Section 2581, p. 1597)
84. CLASS Independence Fund Board of Trustees (Section 2581, p. 1598)
85. CLASS Independence Advisory Council (Section 2581, p. 1602)
86. Health and Human Services Coordinating Committee on Women’s Health (Section 2588, p. 1610)
87. National Women’s Health Information Center (Section 2588, p. 1611)
88. Centers for Disease Control Office of Women’s Health (Section 2588, p. 1614)
89. Agency for Healthcare Research and Quality Office of Women’s Health and Gender-Based Research (Section 2588, p. 1617)
90. Health Resources and Services Administration Office of Women’s Health (Section 2588, p. 1618)
91. Food and Drug Administration Office of Women’s Health (Section 2588, p. 1621)
92. Personal Care Attendant Workforce Advisory Panel (Section 2589(a)(2), p. 1624)
93. Grant program for national health workforce online training (Section 2591, p. 1629)
94. Grant program to disseminate best practices on implementing health workforce investment programs (Section 2591, p. 1632)
95. Demonstration program for chronic shortages of health professionals (Section 3101, p. 1717)
96. Demonstration program for substance abuse counselor educational curricula (Section 3101, p. 1719)49. Grant program for innovations in interdisciplinary care (Section 2252, p. 1272)
97. Program of Indian community education on mental illness (Section 3101, p. 1722)
98. Intergovernmental Task Force on Indian environmental and nuclear hazards (Section 3101, p. 1754)
99. Office of Indian Men’s Health (Section 3101, p. 1765)
100. Indian Health facilities appropriation advisory board (Section 3101, p. 1774)
101. Indian Health facilities needs assessment workgroup (Section 3101, p. 1775)
102. Indian Health Service tribal facilities joint venture demonstration projects (Section 3101, p. 1809)
103. Urban youth treatment center demonstration project (Section 3101, p. 1873)
104. Grants to Urban Indian Organizations for diabetes prevention (Section 3101, p. 1874)
105. Grants to Urban Indian Organizations for health IT adoption (Section 3101, p. 1877)
106. Mental health technician training program (Section 3101, p. 1898)
107. Indian youth telemental health demonstration project (Section 3101, p. 1909)
108. Program for treatment of child sexual abuse victims and perpetrators (Section 3101, p. 1925)
109. Program for treatment of domestic violence and sexual abuse (Section 3101, p. 1927)
110. Native American Health and Wellness Foundation (Section 3103, p. 1966)
111. Committee for the Establishment of the Native American Health and
Wellness Foundation (Section 3103, p. 1968)

With 111 new bureaucracies, boards, etc. there is a golden opportunity for crooks to make millions off you and me, the average taxpayer while we take a number and wait in line for someone to set a bone or try to find out why we have a 104 degree temperature.

I ask you all to contact your congressman and senators to tell them that your health care is not the government’s business and to keep their hands out of our wallets.

As always, I welcome your comments and discussion.


2 thoughts on “Health Care Fraud

  1. Dan,

    Thanks for your article. I read your posts faithfully and generally agree with your points. I agree with the general direction of this post, but want to provide some clarification on your portrayal of the US Postal Service (USPS).

    After a 19 year career with the USPS, and being married to a current USPS manager with 32 years of experience, I think I can shed a little light on the perception of little or no progress in 200 years.

    The USPS was restructured in 1971 to change from a federal department to a quasi-independent agency (Wikipedia). While this sounds like just a name change, it represented an amazing complication of a simple service by the federal bureaucracy.

    Congress mandated that the USPS was to break even or make a profit, though Congress had to approve all pricing and employment policies. Additionally, unionization was introduced, adding yet another impediment to some of the service enhancements you would expect.

    Again, this was a mandate from Congress, with a stifling result. Postal managers and leadership are primarily consumed with satisfying regulatory and organized labor requirements. While the pay and benefits are second to none, the work can be deeply unsatisfying.

    Believe me, there are many good people within the USPS that truly want to do much more than they're able, but are completely overwhelmed. Just imagine how the administration of government-run health care will turn out.

  2. Jeff,
    Thank you for the clarification. The postal employees with whom I have had contact have always been professional, courteous, and, for the most part, very friendly. My concern is with the people who make the policy, in this case, Congress. This emphasizes my point that Congress has no business trying to run any business.
    Thanks again for your clarification.

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