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ObamaCare Is Winning the Fight on Fraud and Abuse

Posted by John McDonough  January 2, 2012 06:10 PM

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Members of Congress of both parties often complain about fraud and abuse in Medicare and Medicaid (M&M), usually charging that the President is not doing enough to keep bad guys from stealing money from these vital programs.

Guess what? Thanks to provisions in the Affordable Care Act (ACA/ObamaCare) and to an unprecedented effort by the Obama Administration, more progress has been made in the past three years to combat health care fraud and abuse than ever before. There was a 68.9 percent increase in criminal health care fraud prosecutions from 2010 to 2011, and 2010 was already the highest ever. See the chart below, released last month by the Transactional Records Access Clearinghouse at Syracuse University. (Note: NPR did a fine piece on this topic last Friday.)


Figure 1: Criminal Health Care Fraud Prosecutions over the last 20 years

Everybody knows there is a lot of fraud in M&M, though no one really knows how much. In the 1990s, the FBI made a back-of-the-envelope calculation of 10%, a never-validated estimate which has assumed undeserved biblical truth status. There's a lot, no doubt. Back in 1997, the New York Times reported that crime families were dropping drugs, prostitution, and gambling to get into health insurance fraud because the money was so much easier to steal.

Someone once told me the most successful day in the history of the Internal Revenue Service was the day they sent Martha Stewart to jail -- because so many folks had the thought, "if they will send Martha to jail, why would they treat me any better?"  Same with these stats -- it is not just the numbers who get caught and go to jail -- and one bad guy was sent up the river for 50 years -- it's everyone ought there who now realizes they have a bigger chance of getting caught. 

The Justice Department and the Office of Inspector General of the Department of Health & Human Services lead the federal effort. I worked on private health insurance fraud issues during my time working on the ACA in the U.S. Senate and saw the construction of the health reform law's anti-fraud provisions from the inside. It was the professionals from DOJ and OIG who set the agenda -- and the smart anti-fraud provisions that were written into Title VI of the ACA are paying off.

Part of the effort involves hyper-charged efforts to catch bad guys through the Health Care Fraud Prevention and Enforcement Action Team (HEAT), and a bigger part involves re-engineering the system to keep them out. For example, prior to the ACA, if a bad guy got kicked out of one state Medicaid program for fraud, he got kicked out of one program; under the ACA, when he gets kicked out of one, and he gets kicked out of all them, including Medicare. That's smart, and that's just a tiny bit of what the ACA does on fraud & abuse.

So here's a question for Mitt Romney and all the Republican presidential candidates who say several times each day, "My first act as President will be to repeal ObamaCare."

Do you mean you are going to repeal the fraud and abuse provisions in ObamaCare, too?

Fighting fraud and abuse is ObamaCare, too. And just a teensy slice of it. There is so much more in the ACA that makes huge sense.  I think I'll do a post on 25 things in the ACA I wonder if the Romney and Rs also want to repeal...

This blog is not written or edited by or the Boston Globe.
The author is solely responsible for the content.

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About the author

John E. McDonough is a professor of practice at the Harvard School of Public Health. He is the author of the book “Inside National Health Reform”, published in 2011 by More »


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