Annual Medicare Fraud: $60 Billion; Annual Profits of Top Ten Insurance Companies: $8 billion

Weekly Standard ^

[navysealdad]

As 60 Minutes reported last week, Medicare fraud is rampant and has now replaced the cocaine (ahem) business as the major criminal activity in South Florida. Both 60 Minutes and the Washington Post report that Medicare fraud now costs American taxpayers roughly $60 billion a year. That may sound like a lot of money, but surely it pales next to the extraordinary profits of private insurance companies, right?

Well, let's see.... Last year, the profits of the ten largest insurance companies in America were just over $8 billion -- combined. No single insurance company made even five percent of what Medicare reportedly loses in fraud.

[sodpoodle]

http://www.gao.gov/archive/1997/ai97176t.pdf

Found this 1997 article which may be helpful.

[TomGuy]

How does an individual defraud medicare? I can see doctors, health care providers and insurance companies being able to but how does the patient do it?

About the only way individuals can is by being in cahoots with some 'organized' group.

Medicare payments are directed to 'providers'/groups, not individuals.

Several years ago, a medicare fraud ring was broken up. Individuals were paid by the ring to go to numerous doctors and frequent visits. They received a few $$$ for their time, while the ring benefitted from the additional charges (for performed or non-performed tests, x-rays, etc.) made to Medicare.

[stephenjohnbanker]

Very well stated. Now just imagine if these slugs were in charge of all of our health care.

[Ev Reeman]

People get in cahoots with doctors to game the system or they make fake medical claims and doctors may just buy the lies. Either way it’s fraud.

[Kansas58]

Call “Medicare coordination of Benefits” at 1-800-999-1118, have your dates and times down. Tell them when prior coverage terminated. That should take care of it.

[Kansas58]

True, so get it removed ASAP if the penalty is in error! Most people don’t know how to do that. This is why an insurance agent might be helpful.

[Sergio]

Bookmark.

[wideminded]

So -essentially, government fraud in the health care system is nearly 10 times the annual profit of the insurance industry... nice.

The Medicare fraud referred to in the article is not government fraud, aside from the fact that the government is not doing enough to stop it.

[Nachum]

The list, ping

[TheBattman]

When the government know about fraud and takes no meaningful steps to stop it, then it becomes government fraud.

[wideminded]

There is something called "durable medical equipment fraud" that involves companies providing a low quality or cheap piece of medical equipment and billing Medicare for a higher quality item.

Yes congress should crack down on this and yes one reason they don't because of campaign contributions, but the practice is fraudulent and unethical in itself.

[WOBBLY BOB]

I like how you can buy a nice motorized wheelchair on craigslist for under $800 ,but through Medicare it’s 5 times that much.

Just like colleges, just like...anything with 3rd party payers.

[wideminded]

Just like colleges, just like...anything with 3rd party payers.

I totally agree that third party payer problem is what drives much of the inflation in medical and tuition costs. But a lot of people either can't see this or are afraid what consideration of this issue might mean for their personal bottom line.

I've noticed that when I try to talk with people about the general problem of third party payers driving up medical costs, they react defensively as if my talking about this might take their insurance away.