Carnival of Fraud

Step right up and be astounded by Miami's bizarre side show of Medicare and Medicaid scammers! After all, you're paying for it!

In spite of HCFA's get-tough rhetoric, this same official notes, the processing of claims continues unabated. "What most people don't realize is that HCFA contracts out claims-processing to private insurance firms, and the marching orders they give are, 'Pay those claims fast. Don't keep the providers waiting.' Besides, the private companies themselves get paid by the claim, so there's no great incentive for them to root out fraud."

Among the measures she advocates:
requiring providers to put up a bond as part of the application process;
charging an application-processing fee to providers and using the surplus to defray the costs of on-site inspections and other safeguards;

forcing providers and doctors to submit an affidavit, under penalty of perjury, swearing not to file fraudulent claims;

easing the process by which Medicare cards can be revoked and reissued, should they fall into the hands of scammers;

mandating that all physicians accept Medicare and Medicaid patients.
One veteran fraud investigator suggests a more radical approach. "They should just put a freeze on all payments for a few months, until they can weed out the bad guys," he huffs.

HCFA officials argue that such moves could cause providers to refuse treatment to Medicare and Medicaid patients.

But others maintain that plenty of lesser reforms could be enacted without jeopardizing the efficiency of the system. For instance, HCFA could make sure all recipients are sent an explanation of benefits -- in the recipient's native language -- to ensure they received a service for which the government was billed. As it is, Medicare often doesn't bother.

They might also pay closer attention to their own fraud investigators, who for years have been filing Management Implication Reports with specific recommendations. "I don't know what happens to those things," says one dejected investigator. "They sure don't get read."

To local prosecutors and fraud investigators who face the nation's highest rate of fraud, frustration with HCFA comes naturally.

"They're up against a bunch of criminals who are like morphic parasites, constantly changing form, and they're this big clunky bureaucracy without the slightest common sense," says one federal prosecutor. "Take the Morfa milk case. How much common sense does it take to see something's wrong there? Do they think the entire population of Dade County is unable to eat solid food?"

ANYONE INTERESTED IN A 1987 CHEVY CAPRICE?
Amid all the naysaying, there remain a few shining examples of the system at its best. One of the most touching occurred last year in Palm Beach, where state officials witnessed the stunning results of a pilot program designed to make it easier for Medicaid patients to receive free transportation to area doctors and hospitals.

In other counties, Medicaid recipients had to obtain prior approval before arranging a ride. The authorities did away with all that messy red tape in Palm Beach. Patients were allowed to call taxis directly. The drivers, in turn, were paid simply by submitting a voucher with a Medicaid recipient's ID number and signature, along with a record of how long the trip was.

The response was phenomenal. In the first ten months of 1994 alone, cabbies billed Medicaid for more than 400,000 trips, at a total cost of nearly $15 million. In fact, more money was shelled out by Medicaid to drivers in tiny Palm Beach County than the entire rest of the state combined!

Obviously the program was a tremendous success. New cab companies sprang up like toadstools. Based on the billing, each of these companies transported a remarkable 90 Medicaid recipients every day.

Perhaps the most inspiring story was that of two Haitian brothers who, according to the bills they submitted, drove Medicaid patients 1.3 million miles in ten months using just one cab -- a 1987 Chevy Caprice. Figuring they drove their cab sixteen hours a day, seven days a week, they averaged a speed of 203 miles per hour. Might sound a little dangerous, but when you're dealing with patients in need, speedy transport is a must, and well worth the $1.1 million they wanted to be reimbursed.

Inexplicably, state authorities claim they were actually trying to shut down the pilot program in Palm Beach as early as 1993. And a handful of cab company owners whose heroic efforts distinguished the program were, sadly, arrested on grand theft charges just this past Friday.

A similarly cruel fate may await 57-year-old Jesus Castillo, a Miami physician who was arrested just this past week for allegedly orchestrating a series of fake auto accidents, then billing the Meds millions in bogus medical costs. According to the federal indictment, three companies owned by Castillo paid recruiters up to $300 for "patients" willing to take part in the accidents.

As preposterous as this may seem, a number of upstanding personal-injury attorneys may also be implicated in the alleged scheme.

THE RULES ARE DIFFERENT HERE
The latest trend in Medicaid involves enrolling recipients in Health Maintenance Organizations (HMOs), private insurance groups that stress preventive care. Recipients who sign up for HMOs, however, surrender their rights to other Medicaid coverage. The idea was to cut costs while offering healthy recipients better preventive care.

It didn't take long for scammers to find an angle.
Because Medicaid pays a set fee for each recipient enrolled, certain HMOs have dispatched recruiters to sign up indigents. "They stalk these poor people," says Dr. Joe Greer, medical director at the Camillus House homeless shelter downtown. "They love us because they know our clients are the least likely to actually use the services, yet the providers still get their monthly check from Medicaid."

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