Calls for investigation sparked by massive Medicare fraud

Lawmakers are calling for an audit and investigation in response to reports of tens of billions of dollars in stolen funds from Medicare.

In 2022, Medicare incurred approximately $47 billion in improper payments, as reported by the Government Accountability Office. As a result, there is now a call for an audit.

According to a report by the GAO, although the number of enrollments revoked under waivers and flexibilities is relatively small, it is important to note that even a limited number of providers can cause significant financial harm through fraudulent activities. The report cites examples, such as a nurse practitioner who pleaded guilty to conspiring in a DMEPOS fraud scheme that defrauded Medicare of nearly $15 million in June 2022. Additionally, in July 2022, the Department of Justice announced criminal charges against 36 defendants for an alleged fraud amounting to over $1.2 billion, which included DMEPOS fraud schemes. These instances highlight the potential impact of fraudulent activities on the healthcare system.

Three Republican senators, Rick Scott of Florida, Mike Braun of Indiana, and J.D. Vance of Ohio, have written a letter to Gene Dodaro, comptroller for the GAO, urging for an audit. In their letter, they highlight the concerns regarding Medicare fraud and mention that other groups estimate the fraudulent activities to be as high as $60 billion annually.

In the meantime, the lawmakers highlight that the agency managed to recover only around $1.7 billion of the taxpayer dollars that were lost due to fraudulent activities.

In a letter addressing the issue, it was highlighted that this fraudulent activity poses a significant financial risk to older Americans, jeopardizes the integrity of our healthcare system, and adds to the already staggering $34 trillion national deficit. The letter emphasized that even the slightest hint of fraud in the private sector would trigger an immediate financial audit. Therefore, the request was made for the Government Accountability Office (GAO) to conduct an audit of the Centers for Medicare and Medicaid Services’ (CMS) internal oversight reforms. The aim is to explore the implementation of innovative solutions, such as machine learning, to strengthen the prevention of fraud and reduce the substantial financial losses currently being incurred.

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Medicare, a federal program catering to 65 million Americans, has become a breeding ground for significant fraud schemes, enabling them to pocket billions of dollars.

The letter stated that recent investigative reports from The New York Times and The Washington Post have brought attention to a Medicare fraud scheme that was discovered by the National Association of Accountable Care Organizations (NAACOS). By analyzing federal data, NAACOS uncovered that within a span of two years, 10 companies went from billing only 15 patients for catheters to an astounding 515,000 patients. This represents a significant increase of 50,000 patients from the previous year and is estimated to have resulted in a $2.7 billion rise in taxpayer spending.

According to the letter, around 23.7 percent of Medicare’s total medical supply expenditures for the year appear to be associated with fraudulent activities. This finding suggests that a substantial portion of these expenses may be linked to fraudulent practices.

Lawmakers highlighted that fraudulent activities related to COVID testing kits resulted in a loss of approximately $200 million.

According to the letter, the recently released fraud data is concerning and has raised doubts about the effectiveness of CMS’ safeguards in preventing fraud.

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