Fraudulent Medicaid Claims Mar Public Health Care Benefits

A great deal of my skepticism regarding the new health care bill stems from having once had a job in the federal government. Part of my job was to review claims for the SSI program. SSI is essentially a federal welfare program for disabled children, the aged, and adults whose income is within certain limits. Overseeing government programs can be frustrating, especially when you encounter fraud. One case in point concerns a parent who was paid about $39,000 in retroactive SSI payments for her disabled child. Instead of putting the money into a trust fund for the child, the parent used it to open up a business-a business which soon failed. I spent weeks "developing" the case which was then to be handed off to the Inspector General's office for prosecution. As with many other similar cases, that case (and all of my wasted work) was tossed into the junk pile. The politburo of federal government legal management decided that political appearances prohibited prosecution of "the poor." The money was gone and couldn't be recovered, and it wouldn't look too good to be prosecuting "the poor," especially if the newspapers picked up the story.

That was only one case in thousands, and the waste of taxpayer money goes on at a record pace, since it is impolitic to stop it. That doesn't mean that people aren't trying. The New York Post published a story today about a scam involving taxpayer money in the state Medicaid plan. It's probably typical of the medical fraud which occurs in all states and most likely the cost of it is underestimated, just as the costs of the new health care bill are underestimated.

The New York Post story focused on a Harlem dental clinic which harnessed the unemployed energies of street hustlers to locate and bring in customers who had state Medicaid coverage. The hustlers would be paid ten bucks a head for each person brought into the clinic for an exam, which may or may not have taken place. The Medicaid covered patients would also be paid amounts ranging from $15 to $20 bucks.

The arrangement made good business sense in terms of profit. While Medicaid reimbursement rates are low, a single patient can bring in $159.00 on a visit. You can do the math yourself. An experienced street hustler knows its easy to find people covered by state Medicaid. SSI recipients are automatically entitled to state Medicaid benefits in any state. Individuals who receive welfare benefits also are entitled to Medicaid. There are ways to find more than one Medicaid covered patient in a single place.

Were I the street hustler, I'd visit group homes, state welfare offices, city social security offices where SSI recipients wait in large numbers to discuss their claims, and homeless shelters, to mention just a few. If the street hustlers brought in 100 people in a day, that would amount to $15,900 in revenues. A licensed dentist, an x-ray machine, a hygienist-that's all it takes for these unscrupulous operators to strip millions from taxpayer funded medical plans. Fraud takes its toll, too, on responsible medical providers who must pay the bills in terms of licensing and other costs of practice.

The cost of medical fraud grows exponentially in those "Medicaid mills" which retain the patients Medicaid billing number and other information to bill claims even when the patient's presence is no longer required.