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Archive for February, 2015

Medicare, Part D, Full of Fraud Due to Lack of Oversight

Wednesday, February 25th, 2015

Medicare, Part D began in 2006 as a program to get much needed medication to more than 36 million senior citizens and people with disabilities.  Billions of needless expense has been added to the program due to lack of oversight and doctors prescribing name brand medications instead of generics.  Moreover, ProPublica has reviewed Medicare’s data and found that many doctor’s patterns of prescribing were fraudulent.  Some doctors blame this on identity theft claiming their identities were stolen.  One doctor, Ernest Bagner, III, made this claim.  Nevertheless, law enforcement, fraud units of at least two insurers and Medicare’s fraud contractor never blocked his national provider ID, which is needed to fill prescriptions.  Bagner had the highest total of money paid by Medicare for prescriptions by 2010.  Bagner claimed that the prescriptions were not his.  He stated, “These people make more money off of my name than I do.”  Some investigating his case do not believe he is being completely truthful.

There are many schemes that are constantly developing to loot the Medicare program.  Many foreign, aging, poor or disabled doctors are hired at small pharmacies and their ID’s are used to write thousands of fraudulent prescriptions for patients whose identities make also have been bought or stolen.  After dispensing, the drugs can be relabeled then sold to wholesalers or other pharmacies.  Other schemes include willing doctors who bill Medicare for the same prescriptions many times over that are never filled.  Not all prescriptions are for pain killers so law enforcement may overlook them.

In Los Angeles, Sheriff’s Sargent Steve Opferman heads LA County’s Health Authority Law Enforcement Task Force.  This is a hot spot of Medicare fraud and he spends much his time running down Part D scams.  Sgt. Opferman stated that most of the scams are related to Armenian organized crime rings. The scams depend upon a large group of doctors who are either unaware or dishonest.  Once the doctors are under law enforcement radar, the crime ring merely finds another doctor.  Opferman stated that Medicare is short of help and investigations can take “months or years” to get basic prescription or billing data.  He stated, “It’s like pulling teeth.”  Opferman said that if Medicare would ensure that doctors and pharmacies are legitimate and if they would shut down ID’s quickly when fraud is suspected, Medicare could stop much of the fraud.

Investigators from many agencies are involved in fraud cases and many times fall short of the goal line so justice is rarely swift.  Part D is run by private insurance companies unlike other parts of Medicare.  Insurers are supposed to look for fraud.  Typically the beginnings of cases investigated by insurers are once they notice a spike in a doctor’s prescribing or when tipped off by a patient.  Medicare does not require insurers to notify its Part D fraud contractor, only encourages reporting.  Insurers are not allowed to block a suspected doctor’s prescriptions.  Furthermore, insurers can only see a portion of the doctor’s prescribing record and they have no insight into the prescribing patterns   that are sent to other companies.  Contractors must get the patient’s chart from the insurers, who suspect fraud, to determine if the patient actually saw the doctor or was prescribed the correct medication.  This is usually where the investigation comes to a dead end.  Part D competes with other areas of Medicare fraud, such as kickbacks.  Only a small percentage is referred for prosecution.  Most are dropped due to “lack of resources or insufficient evidence,” states a 2012 report from the Government Accountability Office.

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US Settles False Claims Act Allegations Against ev3 for $1.25 Million

Monday, February 9th, 2015

The Justice Department announced that it has reached a $1.25 million settlement with ev3, a medical device manufacturer base in in Minnesota.   Ev3 formerly was known as Fox Hollow Technologies. A lawsuit filed under the whistleblower provision of the False Claims Act alleges that between 2006-2007, Fox Hollow induced 12 hospitals in 9 states to admit patients who were undergoing elective atherectomy procedures.   This minimally invasive procedure removes atherosclerosis and opens up coronary arteries, thereby increasing blood flow.   It is usually performed on an outpatient basis.  At that time, Fox Hollow sold the Silver Hawk Plaque Excision System, a device that was used in these procedures.  In order to increase hospital purchases of this device, Fox Hollow convinced the 12 hospitals to admit the atherectomy patients.  The hospitals subsequently submitted claims for unnecessary admissions and received higher reimbursements from Medicare for procedures that should have been performed in an outpatient facility. For more information, please click here.

 

 
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