Medicare fraud by the billions; senators wrestle with how to stop it

McClatchy Washington BureauMay 22, 2014 

— It shows up almost daily, in a drumbeat of press releases from the Justice Department about prosecutions of scam artists who’ve preyed on the government’s biggest health care program -- the $600 billion bureaucracy called Medicare.

In the latest example, an owner and operator of community mental health centers in Baton Rouge, La., and Houston were convicted on May 21st for their roles in a $258 million scheme to submit thousands of false billings to the government.

Citing estimates that Medicare fraudsters are costing taxpayers $60 billion to $90 billion a year, a bi-partisan group of senators is proposing legislation to harden the target.

Led by the chairman of the Special Committee on Aging, Democratic Sen. Bill Nelson of Florida, the group is proposing ways to loosen rules so that insurers and other medical providers can share information that more quickly identifies scammers, especially to ensure they can’t do it again.

Nelson, who calls his home state “ground zero” for Medicare fraud, took to the Senate floor on May 20th to talk about the committee’s extensive examination of the fraud running rampant in Medicare.

He spoke of Patricia Gresco, a former Michigan schoolteacher, who testified that her doctor persuaded her to spend thousands of dollars for treatments for an illness she didn’t have, only to discover that the treatments had given her chest pains. The doctor was arrested for bilking Medicare of $225 million, Nelson said.

The bill, the Stop Scams Act of 2014, would:

--Allow private insurers to share information about potentially fraudulent providers with each other and Medicare.

--Set up a screening mechanism so that providers who held ownership interests in organizations that defrauded Medicare would be identified and blocked from having another whirl through a different company.

--Require full end-to-end testing of new medical diagnostic codes so that fraud prevention systems work properly and payments to providers aren’t delayed.

--Permit the Medicare Payment Advisory Commission to make recommendations for checking fraud, while requiring the panel to come up with a way of estimating how many tax dollars are lost to fraud each year.

“To combat this fraud, it’s going to be one of the core missions of our Aging Committee,” Nelson said.

Nelson’s co-author on the bill is Republican Sen. Susan Collins of Maine. Sponsors also include Democratic Sens. Tom Carper of Delaware and Bob Casey of Pennsylvania, as well as Republican Sen. Chuck Grassley of Iowa.

Email:; Twitter: @greggordon2.

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