Unprecedented $4.1 Billion in Healthcare Fraud Recovered in 2011

The Obama Administration’s efforts to ramp up the fraud and abuse investigations achieved an incredible payoff in 2011; $4.1 billion was recovered as a result of the government’s health care fraud prevention and enforcement efforts. This amount is the highest annual amount ever recovered from individuals and companies who either improperly obtained funds from federal health care programs or defrauded seniors and other taxpayers, according to a recent report released by the Department of Health and Human Services (HHS) and the Department of Justice (DOJ).

Working together under the Health Care Fraud and Abuse Control Program (HCFAC or the Program), the Attorney General and the Secretary of the Department of Health and Human Services (HHS) have proven the tremendous benefit of a collaborative approach to the identification and prosecution of instances of health care fraud, fraud prevention, and the protection of program beneficiaries.

“Our efforts strengthen the integrity of our health care programs, and meet the President’s call for a return to American values that ensure everyone gets a fair shot, everyone does their fair share and everyone plays by the same rules,” said HHS Secretary Kathleen Sebelius.

According to the report, in fiscal year (FY) 2011, HHS’ Office of Inspector General (HHS/OIG) excluded 2,662 individuals and entities. Exclusions were based on criminal convictions for crimes related to Medicare and Medicaid (1,015); or to other health care programs (233); for patient abuse or neglect (206); or as a result of licensure revocations (897). Civil monetary penalties were imposed against providers and suppliers who knowingly submitted false claims to the Federal government, numerous audits were issued, and evaluations with recommendations that, when implemented, would correct program vulnerabilities and save program funds.

“This report reflects unprecedented successes by the Departments of Justice and Health and Human Services in aggressively preventing and combating health care fraud, safeguarding precious taxpayer dollars and ensuring the strength of our essential health care programs,” said Attorney General Holder.” We can all be proud of what’s been achieved in the last fiscal year by the department’s prosecutors, analysts and investigators and by our partners at HHS. These efforts reflect a strong, ongoing commitment to fiscal accountability and to helping the American people at a time when budgets are tight.”

And Attorney General Holder has much to be proud of, as the report also revealed that in FY 2011, the Department of Justice (DOJ) opened 1,110 new criminal health care fraud investigations involving 2,561 potential defendants. Federal prosecutors had 1,873 health care fraud criminal investigations pending, involving 3,118 potential defendants, and filed criminal charges in 489 cases involving 1,430 defendants. A total of 743 defendants were convicted of health care fraud-related crimes during the year. The DOJ at the same time opened 977 new civil health care fraud investigations and, by the end of the fiscal year, had 1,069 civil health care fraud matters pending. Also, the Federal Bureau of Investigation (FBI) heath care fraud investigations resulted in the operational disruption of 238 criminal fraud organizations, and the dismantlement of the criminal hierarchy of more than 67 criminal enterprises engaged in health care fraud.

Although HCFAC was created under HIPAA, HHS credits the Health Care Fraud Prevention & Enforcement Action Team (HEAT) with really turning up the heat. Created in 2009 to prevent fraud, waste and abuse in the Medicare and Medicaid programs, and to crack down on the fraud perpetrators who are abusing the system and costing American taxpayers billions of dollars, HEAT provided a new energy behind enforcement. And the push didn’t stop there, as even more tools and resources were allocated to these efforts under the Patient Protection and Affordable Care Act (PPACA) (P.L. 11-148).

PPACA directed the allocation of another $350 million to boost efforts to fight health care fraud. Certainly, the past year is evidence that much can be accomplished. New tools authorized by PPACA include enhanced screenings and enrollment requirements, increased data sharing across government, expanded overpayment recovery efforts and greater oversight of private insurance abuses. 

This movement shows no signs of slowing down. News regarding overpayment recovery efforts hit the press in the last week as well, with the release of a proposed rule from CMS aimed at recollecting overpayments in the Medicare program. Prior to PPACA, providers and suppliers did not face a deadline for returning overpayments of taxpayers’ money. Under PPACA, there will be a specific timeframe by which self-identified overpayments must be returned.