As our population grows older and lives longer at some point each of us is going to be a customer of our local hospital or primary care physician. Healthcare is one of the most important things that people look for when choosing a community to live in. We see ads on television, radio and online with miracle solutions to help us live longer or to alleviate whatever pain we are feeling. We are incented to visit our doctor for wellness checks at least once a year. Even Governments have jumped in the healthcare game. Some offer free healthcare, while others require that you have it, or they tax you because you do not. The Healthcare field is one of the fastest growing job opportunity fields in the world in order to support our growing population. It is also one of the fastest growing fields where fraud is committed.
Let’s think about it for a moment. What information do you have to provide your doctor or hospital prior to being admitted? The information a fraudster needs to steal your identity is sitting in the billing system of each of these institutions. Your name, address, date of birth, social security number, etc. is readily available to anyone that can access the network of your healthcare professional. This not only includes employees that work in the healthcare facility, it includes their family members and hackers that can gain access to the network.
With the implementation of the Affordable Care Act (ACA), also known as “Obamacare” the instances of fraud rose dramatically. The US Government Accountability Office (GAO) in February 2016 found numerous issues with enrollment figures and subsidies when it came to the ACA. In April 2015 the GAO found 431,000 applications with unresolved inconsistencies with $1.7 Billion in federal subsidies at stake. In the same article there were 35,000 applications being held due to inconsistencies with Social Security Numbers and 22,000 applicants being held due to questions about incarceration. Those applications combined accounted for $222 Million in subsidies. The GAO itself submitted applications using fictitious names and information and were able to obtain $30,000.00 in advance premium tax credits and other benefits. Even as our current President attempts to resolve issues and dismantle the ACA program, there continue to be holes that fraudsters exploit.
I recently sat through an intensive discussion by local healthcare organizations where they were discussing Medicaid expansion in our State. One of the concerns brought up by one of the healthcare administrators was regarding a cap on reimbursements. Reimbursement amounts are determined by expenses the healthcare organization incurs. Expenses cover everything from facilities, operations, payroll, materials, prescriptions, etc. The larger the organization, the more the expenses, the more the reimbursement. This was not a level playing field for the smaller, rural healthcare organizations and was increasing the opportunity for fraudulent expense reporting by all organizations in the State. Further, medical suppliers were increasing prices of material by as high as 500% to match the maximum reimbursement they could receive from Medicaid or other healthcare insurance reimbursement programs. With the opportunity to overbill, physicians and organizations may be given a green light to commit fraud that is actually allowable.
Use and abuse of Opioids is increasingly on the rise. It’s not just among the poor. In a January 2015 study 10 to 14 percent of healthcare professionals are addicted to some sort of prescription drug. The most common healthcare professionals abusing prescription drugs include emergency room workers, anesthesiologists and psychiatrists. While healthcare workers often have easier access to opioids and prescription drugs, the rate of falsified prescriptions has risen to a cost of $72.5 Billion annually according to a 2012 study by the University of Albany. Forging prescriptions and altering existing prescriptions for refills are the most common frauds seen. While many healthcare workers are abusing these drugs themselves, others are also selling them illegally. Penalties vary by State. Illegally selling prescription drugs is often viewed as a felony and results in jail time along with the loss of medical licenses.
As we always do, we provide ways to protect yourself and be proactive in preventing healthcare fraud from happening to you or your organization. I realize nobody wants big brother watching everything they do. However, our healthcare system needs to move to a national database to assist organizations in sharing data to provide consistent care for patients. In addition, with data sharing in mind, healthcare organizations need to be more transparent regarding cost of services so that reimbursements are distributed fairly and accurately. Healthcare organizations also need to be diligent in protecting patient information. Access and data tracking need to be implemented across the board and annual inspections need to occur to ensure compliance by all employees. Whistleblower programs also need to be implemented in the organization and strong punishment must be enforced for violators.
The healthcare industry is one of the most important industries worldwide. It is one that every single person uses. Patients should expect that their information is safe and that the care they are receiving is acceptable and reliable. Healthcare employees need to know that someone is watching for abuses within the trust that the public, patients and administrators are giving them. With all these things working together the opportunity for fraud is tremendously diminished.