Medicare fraud is not only committed when ordering unnecessary tests and procedures for patients. Fraud can be disguised into something else. Anything that is available for billing is a potential for committing fraud. What has become a popular way to commit fraud is through home health agencies, medical equipment suppliers as well as pharmaceutical companies. These so-called phantom pharmacies tend work fast and aggressively. The way they operate is by billing large amounts to the insurer companies, and once they receive their money, quickly dismantle the company and disappear. Some of the owners of such companies buy a one-way ticket to other countries securing the stolen money that way.
In an effort to put an end to this or at least begin to find out what is wrong with the system, Senator Chuck Grassley approached the secretary of DHHS to find answers. He was impulse to do so after an insurer approached him stating he had proof of such fraudulent activity. One way to regulate this is by having these types of companies regulated by government and the need for registering. Hospitals are good about connecting patients with legitimate, dependable organizations that are looking out for the welfare of the patients.
In 2002, the federal government won or negotiated more than $1.8 billion in judgments, settlements, and administrative impositions in health care fraud cases and proceedings. This is the largest return to the government since the inception of the program. In addition, the number of health care fraud cases referred for criminal prosecution by the Department of Health and Human Services ("HHS") has significantly increased. Under this policy or law the government most prove four elements to sustain a conviction: the defendant made, or caused to be made, a statement or representation of material fact in an application for payment or benefits under a federal health care program; the statement or representation was false; the...