Are the Feds Doing Enough to Fight Health-Care Fraud?

There’s universal agreement that fraud is a bad thing, and corresponding commitment to rooting it out wherever it’s found, but when it comes to Medicare and Medicaid, the job may not be getting done.

That’s the takeaway from a recent Government Accountability Office report that said the Centers for Medicare & Medicaid Services doesn’t conduct risk assessments of the programs or maintain an overall anti-fraud strategy. Part of the problem might be budget-related, Kirk Ogrosky, a health-care attorney with Arnold & Porter Kaye Scholer LLP, told me.

The CMS routinely operates under tight budgetary constraints, Ogrosky said, with less than 2 percent of the budget allocated to administrative costs like fraud-fighting. In contrast, most private insurance companies allocate over 6 percent of their budget to administrative costs, Ogrosky said.

“It’s not surprising that CMS hasn’t been able to execute an effective and comprehensive fraud prevention plan,” given its budgetary situation, Ogrosky, a Bloomberg Law advisory board member, told me.

While the GAO report found no evidence of formal risk assessments at the CMS, the agency has taken to address program integrity risks, Louis Saccoccio, chief executive officer of the National Health Care Anti-Fraud Association, told me.

For example, the CMS in conjunction with the Health and Human Services Office of Inspector General is actively prioritizing risks that develop within the program, Saccoccio said, such as in the case of fraud that’s arisen around the pharmacy and addiction treatment space.

“What may be lacking is a more comprehensive and overall risk assessment program that anticipates the yet to develop risks, which in programs as large and complex as Medicare and Medicaid is a challenge,” Saccoccio, a Bloomberg Law advisory board member, told me.

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