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Health Care fraud: A $60 billion problem

Written By | Jun 6, 2014

WASHINGTON, June 6, 2014 — The cost of healthcare fraud is staggering. It makes bank heists look petty in comparison.

Medicaid and Medicare fraud costs the US government as much as $60 billion per year. It makes every taxpayer and unsuspecting victim in the costliest crime in America.

The political debate over the Affordable Healthcare Act has actually made the problem worse, by pulling attention away from the current problems with health care fraud. With inactive monitoring, health care has become an easy target for quick cash.

One of the ways fraud occurs is through inaccurate or fraudulent billing. Health care in the United States works through a number of approved providers. Some less scrupulous providers take an extra cut for themselves bylying about costs or by over-prescribing patients. Another common fraud is to designate family or friends as fake staff, patients and doctors. Sham employees provide a way to launder the illegally-gained money. More patients come. More papers are altered. More and more cheated government paychecks roll in.

Doctors who over treat patients do a double disservice by bilking the government and harming patients. Doctors who continually see a patient to bill for them also often over-prescribe medications for them. This can fuel addiction or provide unhealthy doses of improper medication. In a recent case, U.S. v. Valdez, a vulnerable victim sentence was added because the fraud endangered patients. In 1996 the Accountability Act gave healthcare fraud criminal status. Practitioners can receive up to 10 years in prison, 20 if someone is physically harmed by the fraud. And life in prison can be the sentence for any case that involves a patient dying as a result of wrongly prescribed medicine or treatments.

Some high profile crackdowns are making healthcare ‘opportunists’ sweat before they count their stolen millions. One case from the federal jury involves Matthew Kolodesh, age 52. In October he was found guilty of conspiracy to commit health-care fraud, charged with 21 counts of health-care fraud, 11 counts of money laundering, and two counts of mail fraud. Those crimes earned him a 176 month sentence and a 16.2 million-dollar fine.

Court systems and healthcare officials are hoping high profile cases will deter others from committing fraud and stealing government health funds. Politicians are also pushing for stricter punishments of perpetrators.

Koldesh was prosecuted by the organized crime and gang section in the Justice Department’s criminal division, as this type of crime is in the same category as gang crime. The investigation was carried out by the Federal Bureau of Investigation and the Department of Health and Human Services.

Health care fraud is still a serious problem. There has even been a migration of drug traffickers changing tactics and entering healthcare fraud.

Despite the strict justice being dished out, providers who are invested into their fraud continue to cheat the system.

Court cases initiated by tips from witnesses continue to be the main artillery for the Department of Health and Human Services when it comes to defending against fraud. If you are aware of fraud being practiced, or suspicious of it, you’re urged to file a notice to the FBI via their local office or online.

If you or someone you know has been a victim or witness of healthcare fraud, contact an attorney who can advise on rights, prosecutions and necessary evidence.



George Nielsen

George has been in digital marketing for over 6 years and is passionate about helping small businesses to grow. He loves fishing and following his favorite sport teams. He has a B.S. in Marketing and lives with his wife and daughter in Saratoga Springs, Utah.