Medical Fraud's Staggering Price Tag

[Guest guest]

These are the companies who are worried about being put out of business by a

public option? They should be out of business. How about a rule for

corporations like licensed professionals have: if you commit a felony you lose

your license and you are OUT OF BUSINESS!

Medical Fraud's Staggering Price Tag

 

August 18, 2009

 

http://sanders.senate.gov/newsroom/news/?id=9f65ed6a-ccd1-4f9b-ac41-4d48c7156a8c

 

As the nation engages in a contentious debate over health care, one thing that

almost everyone agrees on is the need to fight rampant fraud. Rip-offs add

billions of dollars a year to the tab for health care in America. How much money

could be saved by eliminating fraud? " It's just an extraordinary sum, " Malcolm

Sparrow of Harvard University told National Public Radio. Unsure if fraud costs

$100 billion or $600 billion, Sparrow told NPR he is sure that whatever the

first digit is, it has 11 zeroes after it. To address the problem, the Senate

health committee on July 23 voted 23 to 0 for an amendment by Senator Bernie

Sanders that would double penalties for health care fraud. " What we have seen

for many years is the systemic fraud perpetrated by private insurance companies,

private drug companies, and private for-profit hospitals ripping off the

American people and the taxpayers of this country to the tune of many billions

of dollars, " Sanders said.

 

Sanders' amendment would authorize double the current penalties under the False

Claims Act for fraudulently billing new health exchanges created by the reform

bill. Convicted companies would face fines of up to six times the amount of the

fraud. " I worry very much that for many international corporations getting hit

with treble damages may well be worth it and passed along as a cost of doing

business, " Sanders said. " What we have to tell these big multi-national

corporations is that if they are going to engage in fraud they're going to pay

for it dearly. "

 

Virtually all of the major hospital chains, private insurance companies, and

pharmaceutical companies have been involved in massive health care fraud over

the past decade, the senator added. He also pointed to a string of criminal and

civil cases against many of the leading corporate health care providers in the

country, including:

 

a.. Earlier this year, a jury found Pfizer owed Wisconsin $9 million for

violating the state Medicaid fraud law more than 1.4 million times by purposely

overcharging the state for prescription drugs. The company faces potential fines

from $140 million to $21 billion.

b.. Also in 2009, UnitedHealth, a leading insurance company, paid $350 million

to settle lawsuits brought by the American Medical Association and other

physician groups for shortchanging consumers and physicians for medical services

outside its preferred network.

c.. In 2003, GlaxoSmithKline paid $88 million in civil fines for overcharging

Medicaid for its anti-depressant Paxil.

d.. Also in 2000, Humana paid $14.5 million to settle federal charges of

overcharging government health programs.

e.. In 2000, the Hospital Corporation of America agreed to pay $745 million to

settle civil charges that it systematically defrauded Medicare, Medicaid and

other federally-funded health programs.

 

In addition to the Sanders Amendment, other initiatives to fight fraud include a

new Obama administration task force made up of officials from the Department of

Justice and the Department of Health and Human Services. A House version of the

health care overhaul bill also includes anti-fraud provisions, such as $100

million a year to fight fraud and increased penalties for perpetrators,

according to NPR.

 

To watch the senator discuss health care fraud at a health committee hearing,

 

 

To read or listen to the NPR report,