Our Multi-Billion Dollar Medical Fraud Problem

The Multi-Billion Dollar Medical Fraud Problem in the United States

We have a multi-billion dollar medical fraud problem in the U.S. and it's costing Americans somewhere between $68 billion and $300 billion each year according to the experts. That means that fraudsters and charlatans are pilfering from our healthcare system the equivalent of between $200 and $900 a year, every year, from every man, woman, and child in the United States.  Of course, Americans who use healthcare services infrequently probably aren't even aware of what's happening.  They can rest assured, however, that medical fraud is costing them in the form of higher health insurance premiums, increased tax burdens, and added out-of-pocket costs when they do have to use healthcare services.  And if financial harm for patients and taxpayers isn't bad enough, medical fraud can also expose Americans to personal harm from medically unnecessary tests, procedures, or medications.

The most common type of medical fraud involves providing tests, procedures, or medications that are not medically necessary. Other common types of medical fraud include (1) billing for services that were not rendered, (2) billing for a more expensive service than the one actually performed (a practice known as "upcoding"), (3) kickbacks payments made to doctors or other healthcare providers in exchange for referring patients or ordering certain tests or procedures, and (4) submitting claims with fraudulent information to a healthcare payer.

Medical fraud is a complex problem for the U.S. healthcare system and there are ongoing public and private initiatives to combat it. Such efforts include:

• Enhanced oversight and enforcement by government agencies
• Better education and training for healthcare providers
• Improved data analytics to identify patterns of fraud
• Whistleblower programs that reward individuals who report fraud

If you suspect medical fraud, do not hesitate to report it to the U.S. Department of Justice or your state's attorney general's office. You can also report it using the resources available from the National Health Care Anti-Fraud Association (NHCAA).

References:

(1) The Challenge of Health Care Fraud: by the National Health Care Anti-Fraud Association
(2) Health Care Fraud | United States Sentencing Commission
(3) Inside the mind of criminals: How to brazenly steal $100 billion from Medicare and Medicaid
(4) Health Care Fraud - FBI

Rural Health Associations

Rural health associations are a key voice in the efforts to improve rural healthcare in America. Serving the healthcare needs of rural Americans, which comprise about 15% of the U.S. population, or close to 46 million people, has long been a challenge. Despite the wealth and resources of America's healthcare system, the reality is that rural Americans, in general, have more health issues and poorer health outcomes than their urban counterparts. For example, rural residents are more likely than urban residents to die prematurely from all five of the leading causes of death in the United States: cancer, stroke, heart disease, unintentional injury, and chronic lower respiratory disease. These health disparities stem from many causes. More limited access to healthy foods, higher rates of smoking, lower income and education levels, a higher likelihood of poor or no health insurance, and poor access to healthcare services are just some of the factors that contribute to the health disparities found in rural America.

Rural health disparities have long been prevalent in the U.S. The earliest initiatives to address poor rural health care actually date back more than 100 years. And since the middle of the 20th century, various state and federal programs have had mixed success at advancing the state of healthcare for rural Americans. While improvements have been achieved through these various efforts, many challenges remain to reducing rural health disparities. Rural health associations play an important role in these ongoing efforts to improve the rural health disparity gap.

Rural health associations, which typically operate in a particular state or region, are membership based organizations that provide leadership and advocacy on rural health matters at the state and national level. These organizations are usually comprised of rural health care institutions and practitioners, educational institutions, industry partners and others with a vested interest in the delivery of healthcare products and services to rural populations. The operating objective of a typical rural health association is to:

Identify rural health issues and needs in their service regions

Serve as a single voice in the promotion of rural health initiatives and issues in their region

Disseminate timely information about key federal and state health programs and policies

Educate and advocate about rural health issues and policies

Encourage networking and collaboration among parties who support rural health causes

To find the rural health association serving your area, and to learn more about the important work that they do, visit our Rural Health Associations resource page.

Protecting the Public: Health Facility Licensing

While hospitals and nursing homes are readily recognized as examples of institutional healthcare facilities, many other types of health facilities deliver patient care within the U.S. healthcare system.  Comprised of both profit and non-profit oriented organizations, these institutional providers typically focus on delivering either a specific type of healthcare service or, in some cases, serving a particular segment of the community.  Beyond hospitals and nursing homes, institutional health facilities include:

• adult day care centers
• ambulatory surgery centers
• assisted living facilities
• birth centers
• clinical laboratories
• federally qualified health centers
• community mental health centers
• dialysis clinics
• outpatient rehabilitation facilities
• end-stage renal disease centers
• home health agencies
• hospices
• intermediate care facilities
• facilities for the developmentally disabled
• residential treatment facilities
• rural health clinics
• skilled nursing facilities
  
  

Regulatory oversight of hospitals, nursing homes and these other types of institutional health facilities comes at both the federal and state levels.  At the federal level, all of these institutional providers must meet certain requirements in order to participate in the Medicare program that provides health insurance to most everyone over the age of 65, plus several million younger individuals with disabilities.  In order to assist consumers in determining if a hospital or other health facility meets these federal requirements to participate in Medicare, the U.S. government makes available more than a half-dozen online provider lookup tools:

• Hospital Compare
  
• Nursing Home Compare
  
• Home Health Compare
  
• Hospice Compare
  
• Inpatient Rehabilitation Facility Compare
  
• Long Term Hospital Compare
  
• Dialysis Facility Compare
  

Beyond meeting requirements to participate in Medicare, institutional health facilities must also satisfy licensing standards established by regulatory authorities in each state in which they operate.  These state licensing efforts aim to protect the public by assuring that health facilities have demonstrated an ongoing ability to meet certain technical and quality-of-care standards in their delivery of services to consumers.  

To assist the public with determining the license status of institutional health facilities that operate within their boundaries, each state provides online license verification tools or resources.  Visit our Health Facilities License Lookup resource page for more information about these state license verification tools and resources.

Protecting the Public: FDA Warning Letters

The U.S. Food and Drug Administration (FDA) plays a key role in public health as it is the national agency responsible for regulating food safety, prescription and nonprescription medications, tobacco products, medical devices, biological products. radiation emitting devices, cosmetics, animal foods and feed, and veterinary products.  The FDA regulates not just the manufacture of these products, but also the marketing and distribution of these products to the public.  

When the FDA finds, through its own inspections or evidence from other sources, that a manufacturer or other entity has engaged in activity that violates federal rules, it will issue a warning letter to the offending party.  A warning letter advises the offending party of the manner in which their actions are violating federal laws or regulations and affords that party an opportunity to take voluntary corrective actions.  Offending parties who fail to take corrective actions are subject to sterner FDA enforcement actions such as a recall, seizure, injunction, administrative detention, civil money penalties and/or prosecution for their violations of federal laws.  Warning letters are not a mandated step before the FDA takes more stringent enforcement measures.  If the circumstances involve an egregious violation of the law, such as something that creates the possibility of death or injury to an individual, the FDA will forego issuing a warning letter and take sterner enforcement measures against offending parties.

While warning letters involving a major manufacturer or product might make the national or local news, the majority of warning letters involve lesser known producers or products that won't grab the headlines.  To help public awareness about violations that merit a warning letter, the FDA provides a searchable database of more than 3,100 warning letters issued since the beginning of 2015.  Users can easily drill down into search results to read the actual content of a letter and to find out more about the specific violations of an offending party.  

Since the beginning of 2015, the FDA has, on average, issued almost 47 warning letters each month.  Even with a searchable database, keeping up with that volume of activity can be problematic for consumers.  To help consumers more easily stay abreast of new warning letters, the FDA also makes available a convenient email subscription service.

To stay aware of product safety issues involving FDA regulated products, consumers are encouraged to bookmark and periodically visit the FDA Warning Letter Database and to stay atop of FDA news by signing up for their email subscription service.

The Growing Role of Community Health Centers in Primary Care

Federally supported community health centers (CHC) have been providing high quality primary care services to patients, regardless of a patient's ability to pay, for more than 50 years now.  Found in every U.S. state and territory, CHC's provide medically underserved communities with integrated primary care healthcare, including care for medical, dental, vision, behavioral health and substance use disorders.  In 2019, approximately 1,400 community health centers, operating through almost 13,000 delivery sites and engaging more than 252,000 full-time healthcare providers and staff,  served the primary care needs of nearly 30 million patients.  So last year 1 out of 11 (9%) Americans relied on federally supported community health centers for their primary care needs.

Taking a deeper dive into the numbers, the Health Resources and Services Administration (HRSA), the unit of the U.S. Department of Health and Human Service that oversees CHC programs across the country, reports that in 2019 CHCs served:

• 1 out of every 8 children in the U.S.
• 1 out of every 5 rural residents
• 1 out of every 5 Medicaid recipients
• 1 out of every 3 Americans living in poverty
• more than 398,000 military veterans
• more than 1.4 million U.S. agricultural workers
• more than 1.4 million U.S. homeless; and
• more than 885,000 children through school-based health centers

Given the scale and scope of services they provide, CHCs also play an important public health role in the U.S. healthcare system.  CHCs are critical providers in the screening and treatment of individual living with substance use disorders, HIV and, more recently, COVID-19.  In 2019, CHCs screened nearly 1.4 million people for substance use disorders and 2.2 million patients for HIV. 

The role of CHCs in the U.S. healthcare system has been steadily increasing over the years.  In 2009, the year before the enactment of the Affordable Care Act (ACA), CHCs served 18.8 million patients according to the HRSA, nearly double their patient volume of 9.6 million patients in the year 2000.  Enactment of the ACA provided a further boost to CHC growth in two main ways.  First, it expanded Medicaid and private insurance, thereby improving the revenue model for CHCs.  Second, the ACA allowed for increased federal investment in the CHC program which, in turn, has led to the formation of more CHCs and expanded capacity to serve the public.  

From serving about 3.5% of the U.S. population in 2000, to serving 9% of the U.S. population in 2019, the role and importance of federally supported community health centers has never been more significant.  With some research estimating pandemic-related job losses resulting in over 7 million people losing employer-based health insurance, another 4 million more people shifting to Medicaid or the Children’s Health Insurance Programs (CHIP) for insurance coverage, and almost 3 million people becoming uninsured, the importance of CHC primary care services has never been greater.  

To learn more about federally supported community health centers, visit the HRSA.

To find federally qualified health centers in your community, use the locator tool below:

 

Protecting the Public: State Nursing Boards

 Registered nurses (RNs), vocational or practical nurses (LVNs or LPNs), advanced practice registered nurses (APRNs), and various other nursing professionals must be licensed in the states in which they practice.  In most states, it is a State Nursing Board, or the equivalent, that provides regulatory oversight of the nursing professions.  With more than four (4) million RNs, LVNs, LPNs and other nursing professionals employed in the United States, effective oversight is significant task for state licensing authorities.  These regulatory authorities protect the health and safety of the public by determining licensure qualifications for new nursing professionals, establishing standards for practitioners to follow in order to maintain their license to practice, disciplining licensees who fail to adhere to those requirements, and promoting the delivery of the high quality nursing care. In addition to nurses and other nursing professionals, in many states the Nursing Board, or its equivalent, provides regulatory oversight of various institutions that provide nurse training and education.  To find the Nursing Board, or the equivalent, serving in each state, check out our resource guide:

State Nursing Boards | Health Guide USA

Protecting the Public: State Pharmacy Boards

Pharmacists, pharmacy technicians and other pharmacy professionals must be licensed in the states in which they practice.  In most states, regulatory oversight is provided by a State Pharmacy Board or the equivalent.  These regulatory authorities are responsible for protecting the health and safety of the public by determining licensure qualifications for new pharmacy professionals, establishing standards for practitioners to follow in order to maintain their license to practice, disciplining licensees who do not adhere to those requirements, and promoting high quality pharmaceutical care and pharmacy services. In addition to pharmacists and other pharmacy professionals, in a number of states the Pharmacy Board, or its equivalent, provides regulatory oversight of pharmacies and other institutions engaged in the distribution of pharmaceutical products and services.  To find the State Pharmacy Board, or the equivalent, that oversee pharmacists, pharmacy technicians and other pharmacy professionals in each state. visit our resource guide:

State Pharmacy Boards | Health Guide USA

Protecting the Public: Dental License Verification

Dentists, dental hygienists, dental assistants and other dental healthcare professionals are subject to regulatory oversight by each of the individual states in which they practice.  While licensing requirements vary from state-to-state, the core objective of dental regulators everywhere is to protect the public from unqualified individuals offering or delivering dental care services.  This is accomplished by establishing standards, educational and otherwise, which individuals must satisfy in order to obtain a license to deliver dental care services. Similarly, dental licensing authorities establish standards which practitioners must attain in order to periodically renew their license to practice.  When licensees fail to meet established standards, dental licensing authorities can impose a range of disciplinary measures against offending practitioners, including, in the most egregious situations, the suspension or revocation of an individuals license to practice. 

In order to assist the public, as well as credentialing professionals working for hospitals, health plans and other entities needing to confirm the license status of dental care practitioners, dental licensing authorities in each state provide online license verification tools.  To find state-operated online tools that permit the public to confirm the license status of dentists, dental hygienists, dental assistants and other dental healthcare professionals, visit our resource page:

Health Guide USA Dental License Lookup

Protecting the Public: State Medical Boards

Physicians and surgeons must be licensed in the states in which they practice.  In most states, regulatory oversight is provided by a State Medical Board or the equivalent.  These regulatory bodies are responsible for protecting the health and safety of the public by determining licensure qualifications for new physicians and surgeons, establishing standards for practitioners to follow in order to maintain their license in good standing, and disciplining licensees who do not adhere to those requirements. In addition to physicians and surgeons, in a number of states the Medical Board, or its equivalent, provide regulatory oversight of physician assistants and various other types of healthcare professions.  To find the Medical Boards, or the equivalent, that oversees physician and surgeon practitioners in each state. visit our resource guide:

State Medical Boards | Health Guide USA