The Senior Medicare Patrol (SMP) in California protects people from Medicare-related fraud, error and abuse. It also works to build community partnerships to prevent Medicare and Medi-Cal (Medicaid) fraud, error and abuse.
Medicare fraud includes intentionally covering up the truth with the aim of obtaining illegitimate benefits. Paired with abuse, which involves practices that don’t adhere to authorized fiscal and medical practices to increase expenses, healthcare scams severely harm both the state and federal medical systems.
Statistics on Medicare fraud statistics show that billions of dollars are wasted every year due to scams and corruption causing irreparable damage to the healthcare systems. The huge amount of lost money could have been invested in a range of legal and needed medical services. The enormous expenses of these fraudulent practices also result in the escalation of Medicare costs. The most serious result may be the increased risk of harm to patients who undergo a range of unnecessary and sometimes harmful procedures.
The following statistics shed some light on the size of our Medicare population, the amount of money spent every year on its services and the amount wasted through improper payments.
- 15% of US residents have Medicare;
- Fraud, abuse and waste account for up to 10% of overall healthcare expenditures;
- Politifact notes that Medicare fraud costs are estimated at $50 billion a year
- Medicare lost $2 billion in one single large multi-agency fraud involving distribution of opioids and other hazardous drugs;
- Medicare has an improper payment rate of 14.90%, the highest among its peers;
- US doctors believe overtreatment is common: 85% of doctors believe this is due to fear of being sued for malpractice but 70% believe colleagues are more likely to do unnecessary procedures when they can profit from it;
- Medicare could save $367 million by checking improper payments for inadequately filed outpatient treatment claims;
- CMS (Centers for Medicare & Medicaid Services) spent $160.8 million on medications for Medicare Advantage plans while these drugs were already being covered by hospices;
- The National Healthcare Anti-Fraud Association (NHCAA) reports that fraud and abuse comprise between 3% and 10% of total healthcare spending;
- The DOJ and HHS actively fight healthcare and insurance frauds and prosecute perpetrators, returning over $1 billion to the Medicare Trust Fund through fines forfeits and recoveries;
- The GAO and CMS report that Medicare expenses amounted to $750.2 billion and Medicaid expenses were $597.4 billion in 2018.
These statistics certainty highlight the money spent and the money wasted on Medicare/Medicaid. I attended a presentation last month by Micki Nozaki of the California Senior Medicare Patrol. She presented a view of the Medicare/Medicaid fraud that seemed more frightening and harmful than the monies lost and that is the actual physical toll these fraud schemes take on the patients involved. She highlighted a study by Johns Hopkins University on the human cost of this fraud and abuse.
- Patients receiving treatment from fraud and abuse perpetrators had a 22% higher mortality rate with 30% higher rate of emergency hospitalizations;
- The study estimated that exposure to fraud and abuse perpetrators led to 6700 premature deaths;
- Fraud and abuse perpetrators disproportionately treat minority, disabled and low-income Medicare beneficiaries;
- One $34 million Medicare fraud involved a physician using unnecessary chemo drugs causing untold pain, suffering and 2 known deaths;
- A $73 million Medicare fraud involved using torturous laser procedures and falsification of records;
- $150M fraudulent billings resulted from patients recruited from homeless shelters and food kitchens being forced to accept painful back injections in exchange for opioid drugs;
- Medicare Hospice is not intended for non-terminal patients and no patients should be receiving or billing for services/equipment from more than one hospice provider.
We are the eyes and ears to fight elder abuse and Medicare/Medicaid fraud. There are Senior Medicare Patrols in all 50 states plus the District of Columbia, Guam, Puerto Rico, US Virgin Islands. You can find your local SMP by calling 877-808-2468 or www.smpresource.org.
A good source of local, free and unbiased information on Medicare, Medicare Advantage Plans, Medigap, Long Term Care Insurance is your state SHIP (State Health Insurance Programs) or HICAP (Heath Insurance Counseling and Advocacy Program). In California, you can reach them at 800-434-0222 or SHIPS outside of California at shiptacenter.org.
The financial cost of this fraud is huge and expected to reach $1.5 trillion by 2028 or 21.9% of federal spending per the GAO and CMS. The human cost frequently experienced by our most vulnerable citizens is impossible to estimate. One person reporting something can make a difference and possibly save a life. This is the classic case of “If you see something, say something.”