The Fraud Dilemma

Fraudulent providers can rob taxpayers of money due to Medicaid beneficiaries.  Fraudulent offenses include:

  • billing Medicaid for services provided to patients ineligible  for Medicaid;
  • billing for services not rendered;
  • upcoding (i.e., charging for more expensive services or equipment that the patient received);
  • providing inappropriate, risky or unncessrary treatments;
  • requesting reimubrsement for care provided by unlicensed or untrained workers;
  • engaging in kickback arrangements , bribes or other illegal marketing practices;
  • forging prescriptions;
  • promoting off-label drug use; and
  • offering flawed or non-existent testing; and illegally adding tests or services that were not requested (bundling);

Should Medicaid sanction fraudulent providers? The answer seems obvious.  Policymakers, however, are often loathe to sanction Medicaid providers, especially those who care for the beneficiaries most in need.

Local policymakers also proved reluctant to enact regulations or impose sanctions that would improve patient care.  In place where there were acute bed shortages, officials were particularly unwilling to take on the industry.  Even where there were egregious conditions, they would not shut down a facility because its inhabitants had no other place to live.  Thus, the owners could hold elected leaders hostage because ‘throwing old people out of nursing homes was scarcely politically acceptable, unless organized alternatives were available–and they were not.’ ”

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