Health care is a tempting target for thieves. Medicaid doles out $415 billion a year; Medicare (a federal scheme for the elderly), nearly $600 billion. Total health spending in America is a massive $2.7 trillion, or 17% of GDP. In 2012 Donald Berwick, a former head of the Centres for Medicare and Medicaid Services (CMS), and Andrew Hackbarth of the RAND Corporation, estimated that fraud ... added as much as $98 billion, or roughly 10%, to annual Medicare and Medicaid spending - and up to $272 billion across the entire health system. Federal prosecutors had over 2,000 health-fraud probes open at the end of 2013. A Medicare strike force", which was formed in 2007, boasts of seven nationwide "takedowns". In the latest, on May 13th, 90 people, including 16 doctors, were rounded up in six cities - more than half of them in Miami, the capital city of medical fraud. Punishments have grown tougher: last year the owner of a mental-health clinic got 30 years for false billing. Yet the sheer volume of transactions makes it easier for miscreants to hide: every day, for instance, Medicare's contractors process 4.5m claims. In this context the $4.3 billion recovered by fraud-busters in 2013, though a record, looks paltry. Some criminals are switching from cocaine trafficking to prescription-drug fraud because the risk-adjusted rewards are higher. This is the medical world's "dirty secret", says John Holcomb of the Texas Medical Association. Everyone talks about it in the doctor's lounge, but few complain.
Latest
Latest News
Each news summary is created according to strict standards. Here's how we do it.
Each summary is created using a consistent editorial procedure. The target length is approximately 16 lines of 11-point Arial text in a 650-pixel-wide column. Up to 25% of a summary may be set in bold to emphasize the most important ideas. Summaries are composed of verbatim excerpts presented in the same sequence as they appear in the original news source, with very minor editorial additions. Where material has been omitted between excerpts, the omission is indicated with ellipses (...). Any words added by an editor for clarity or context appear in [brackets]. Our original news editor was Fred Burks. Tod Fletcher edited most summaries from 2007 through 2014, and Mark Bailey has served as news editor since 2014.