By Dave Lucas
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Albany, NY – Senator Kirsten Gillibrand is introducing a bill to crack down on Medicaid and Medicare fraud, a problem that each year costs New York State $5 billion. Capital District Bureau Chief Dave Lucas reports.
Medicaid and Medicare fraud is estimated at $80 billion a year nationally. The federal government has identified New York City, Miami and Los Angeles as high fraud areas. In the Capital Region, taxpayers lose more than $320 million to Medicare and Medicaid fraud. The numbers get higher as you head south: in the Hudson Valley $580 million and in New York City 2 BILLION dollars lost to fraud each year. Gillibrand's measure would double criminal penalties for fraud, toughen fraud prevention and set up a five-year pilot program to verify Medicare and Medicaid reimbursement claims. The Senator says that by creating more transparency and more accountability in Medicare and Medicaid, taxpayer dollars can be saved while protecting services for seniors and others who need them. She claims to have worked with medical providers on the bill.
Senator Gillibrand's legislation, the Medicare and Medicaid Fraud Enforcement and Prevention Act, would build on these changes by establishing the following protections for citizens and taxpayers:
Enhanced Criminal Penalties: To crack down on offenders, the Medicare and Medicaid Fraud Enforcement and Prevention Act doubles the criminal penalties for making false statements in connection with services which are paid for in whole or in part by the Federal Health Care Program and for violating the anti-kickback statute from 5 to 10 years of imprisonment and increased fines from $25,000 to $50,000.
The legislation also creates a new offense for illegally distributing a Medicare or Medicaid beneficiary ID or billing privileges, and establishes a maximum penalty of three years in prison and a fine.
Fraud Prevention: To help prevent fraud before it can occur, the legislation makes criminal background checks, finger-printing and random site visits mandatory for high-risk suppliers and providers to ensure they are legitimate businesses before they cash a single Medicare check.
The legislation also directs the Secretary of Health and Human Services (HHS) to provide access to data necessary for combating Medicare fraud for law enforcement officials. The Secretary would consult with the U.S. Attorney General and the Inspector General at HHS to ensure that law enforcement authorities are alerted immediately upon suspicious activity.
The HHS Secretary would also be required to implement a 5-year Beneficiary Verification Pilot Program that establishes a process to verify that claims for reimbursement belong to the Medicare or Medicaid beneficiary, similar to how banks and credit card companies verify whether a large purchase was made by the cardholder or if it was stolen. HHS would contact the beneficiary to verify a medical service purchase belongs to the correct Medicare or Medicaid beneficiary. Data collected would also help keep a more accurate record of fraud. The results from the pilot program would be presented to Congress show the prevalence of fraud and the effectiveness of these new measures for catching fraudulent activity.
Oversight Of Medicare Contractors:To improve oversight and accountability of the Medicare system, the legislation directs the Government Accountability Office (GAO) to study Medicare contractors, including Recovery Audit Contractors, and report to Congress with recommendations for legislation and administrative action, regarding the following areas: Training and expertise in identifying fraud, including the education al levels of key individuals tasked to identify or refer potential cases of fraud; and whether CMS should be providing more training to contractors or require contractors to hire experts with greater medical training.
Exact revenue expectations for what fraud prevention will bring in are being determined. A similar bill (minus the pilot program) has been introduced in the House. Gillibrand has no figure yet on the cost of implementing such a program should it become law.