Members of Congress of both parties often complain about fraud and abuse in Medicare and Medicaid (M&M), usually charging that the President is not doing enough to keep bad guys from stealing money from these vital programs.
Guess what? Thanks to provisions in the Affordable Care Act (ACA/ObamaCare) and to an unprecedented effort by the Obama Administration, more progress has been made in the past three years to combat health care fraud and abuse than ever before. There was a 68.9 percent increase in criminal health care fraud prosecutions from 2010 to 2011, and 2010 was already the highest ever. See the chart below, released last month by the Transactional Records Access Clearinghouse at Syracuse University. (Note: NPR did a fine piece on this topic last Friday.)
Figure 1: Criminal Health Care Fraud Prosecutions over the last 20 years
Everybody knows there is a lot of fraud in M&M, though no one really knows how much. In the 1990s, the FBI made a back-of-the-envelope calculation of 10%, a never-validated estimate which has assumed undeserved biblical truth status. There's a lot, no doubt. Back in 1997, the New York Times reported that crime families were dropping drugs, prostitution, and gambling to get into health insurance fraud because the money was so much easier to steal.
Someone once told me the most successful day in the history of the Internal Revenue Service was the day they sent Martha Stewart to jail -- because so many folks had the thought, "if they will send Martha to jail, why would they treat me any better?" Same with these stats -- it is not just the numbers who get caught and go to jail -- and one bad guy was sent up the river for 50 years -- it's everyone ought there who now realizes they have a bigger chance of getting caught.
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