Health Care Fraud and Abuse Essay

Health Care Fraud and Abuse Essay

Health care fraud is the filing of dishonest health care claims to obtain a profit and is considered a white collar crime. Health care abuse is when someone overuses or misuse services. Both, Health care fraud and abuse, in the United States is an ongoing issue and is costing the United States government billions of dollars. Every time a fraudulent act is perpetrated the insurance company passes the cost to its customers. Due to the high volume of health care fraud statistics shows that 10 cents to every dollar spent on health care goes toward paying fraudulent health care claims.

The federal government’s action to fight healthcare fraud and abuse brought forth The False Claims Act (FCA) of 1986. Under the FCA, the United States may sue violators for damages, plus $5,500-$11,000 per false claim.Health Care Fraud and Abuse Essay.  In a further effort to fight fraud and abuse, in 1993 the Attorney General announced that tracking healthcare fraud and abuse would be a top priority for the Department of Justice. The Health Insurance Portability and Accountability Act (HIPPA) of 1996 established the Healthcare Fraud and Abuse Control program (HCFAC).


HHS and the Attorney General allocated $248,459,000 to HCFAC to fight healthcare fraud and abuse in 2007. (Report, 2008) Health care fraud and abuse has increased within the past decade. Today the Health and Human Services (HHS) and the Office of the Inspector General (OIG) projected that fraud and abuse accounts for between 3 and 15 percent of expenditures for healthcare in the United States. Other agencies, such as The National Healthcare and Antifraud Association Report, the Congressional Budget Office, and the US Chamber of Commerce suggest that raud and abuse costs range between 3-10 percent, 10 percent, and 15 percent respectively. According to this data, the annual estimated cost of healthcare fraud and abuse ranges between $100-170 billion in America. (Advocacy, 2011) Due to the increase in healthcare fraud and abuse in the current U. S. health care system, how effective is the OIG’s health care fraud and abuse program and what actions can health care organizations take to decrease their liability?

In 2011, the Department of Justice opened more than one thousand cases regarding healthcare fraud and/or abuse. During, this year the Federal Government was able to win or negotiate $2. 4 million in health care settlements and judgements. The OIG alone with the HHS and attorney general has successfully prosecuted the most flagrant cases of healthcare fraud and abuse. HHS/OIG imposed civil monetary penalties against, among others, providers and suppliers who knowingly submitted false claims to the Federal government.Health Care Fraud and Abuse Essay.

HHS/OIG also issued numerous audits and evaluations with recommendations that, when implemented, would correct program vulnerabilities and save program funds. The Office of Inspector General or OIG has the responsibility to help maintain the integrity of the Department of Health and Human Services or HHS programs. The OIG must also protect the health and welfare of program participants and beneficiaries. The mission of the OIG is carried out by using a multidisciplinary, combined approach, with six major departments of the OIG in which plays a very important role.

The OIG uses a nationwide network of audits, investigations, and evaluations results in timely information as well as cost-saving or policy recommendations for deciding on important matters and the community. That network also assists in the development of cases for criminal, civil and administrative enforcement. (US Department of Health and Human Services) The Immediate Office of the Inspector General is directly responsible for the overall implementation of OIG’s operation and for promoting operational administration and the attribute of OIG processes and products.

The Immediate Office staff is responsible for the following: • serve as liaison to the Secretary and Deputy Secretary of HHS • review all existing and proposed HHS regulations and legislation • promote OIG activities and accomplishments by reaching out to the public, media and other external entities • compile and issue publications that provide an overview of OIG’s work, including the annual Work Plan and Semiannual Report(s) to Congress • coordinate congressional testimony process all Freedom of Information Act requests • Plan, conduct and participate in a variety of cooperative projects within HHS and with other Government agencies. The Office of Audit Services (OAS) performs self-determining audits of HHS programs and/or HHS grantees and service providers. The audits investigate the accomplishments and performance of HHS programs and/or grantees in carrying out their tasks and provide self-determining assessments of HHS programs and operations.

These evaluations lend a hand in the reduction of waste, abuse, and mismanagement and encourage economy and effectiveness throughout HHS. OAS conducts audits using its particular resources and oversees audit work performed by others. OAS is the largest civilian audit agency in the Federal Government. Health Care Fraud and Abuse Essay. OAS conducts its work in accordance with Government Auditing Standards issued by the Comptroller General of the United States; the Single Audit Act Amendments of 1996; applicable Office of Management and Budget circulars; and other legal, regulatory, and administrative requirements.

OAS also: • provides assistance in criminal, civil, and administrative investigations conducted by OIG’s Office of Investigations and the Department of Justice; • oversees non-Federal audit activity, including conducting quality control reviews of audits of State and local governments, colleges and universities, and nonprofit organizations; and • Oversees HHS’s annual financial statement audits conducted under the Chief Financial Officers Act and HHS’s annual Federal Information Security Management Act audits. The Office of Evaluation and Inspections (OEI) conduct national evaluations of HHS programs from a broad, issue-based perspective.

The evaluations offer practical recommendations to improve the efficiency and effectiveness of HHS programs, with a focus on preventing fraud, waste, and abuse. The OEI also: • monitors the impact its recommendations and evaluations have on HHS programs by tracking legislative or regulatory changes, documented savings, improved coordination efforts and other benchmarks; • provides congressional staff with technical assistance and briefings on proposed or completed work; • works in concert with other components to identify vulnerabilities in HHS programs nd recommend changes; and • Oversees the state of Medicaid Fraud Control Units which investigate and prosecute providers for Medicaid fraud as well as patient abuse and neglect. The Office of Management and Policy (OMP) mission is to provide management, guidance, and resources in support of OIG. Our vision is to be the best at what we do. OMP is focused on customer satisfaction, reliability, innovation, and continuous improvement. The Office of Investigations (OI) conducts criminal, civil and administrative investigations of fraud and misconduct related to HHS programs, operations and beneficiaries. Health Care Fraud and Abuse Essay.

State-of-the-art tools and technology assist OIG investigators around the country and help OI meet its goal of becoming the world’s premier health care law enforcement agency. The Office of Counsel to the Inspector General (OCIG) provides timely, accurate and persuasive legal advocacy and counsel to the Inspector General and OIG’s other components. The OIG has a developed an intricate program in which internal and external controls does not conflict. OIG’s healthcare fraud and abuse program is a very good program.

It has different departments that specialize in different things which in return are a benefit. This helps one department focus on one aspect instead of focusing on all factors but is unsure of certain things. With different departments handling different objectives this will increase the effectiveness of the research or investigations. Each department specializes in a section and is accountable for all findings related to the healthcare fraud and abuse. No health care organization is immune from the threat of health care fraud and abuse.

Currently, this is one of the major challenges for any health care organization. The professional organizations are usually unprepared for any attack neglect on private information. When these organizations are not prepared this will leave them vulnerable and highly likely to experience some type of fraud and or abuse. The large organizations are too large to keep track of the security systems that they have set and track the individuals responsible for these systems.

The large organizations are considered the small fish in a big pond when it pertains to health care fraud and abuse. Health Care Fraud and Abuse Essay. The professional organizations look upon the large organizations and wonder if the large organizations cannot control health care fraud and abuse how they can control it. Well, there are steps in preventing and controlling health care fraud and abuse with in all types of health care organizations. The first step is to perform background checks on all perspective and current employees . Preventing healthcare fraud and abuse starts at the employee level.

Professional practices should never hire an employee without first conducting a thorough background check that includes past employment, professional and personal references, education, credit record, criminal record, Social Security number, and a drug test. The second step is to encrypt data. Information systems are the next defense against healthcare data breaches. Aside from employees, who else can access the computer system? Hackers may assume professional practices don’t have a sophisticated healthcare data breach security system.

They can prove hackers wrong by ensuring data transmitted over their network uses an encryption technology known as secure socket layer (SSL). Complex passwords should be implemented only for those employees who need access to patient records. The third step is to create policies and procedures to prevent healthcare data breaches. Professional practices should also develop a strict set of policies and procedures to safeguard protected health information (PHI) under the Health Insurance Portability and Accountability Act (HIPAA).

A healthcare fraud and abuse expert can assist with creating these policies and procedures. The fourth step is to shred any and all data. This one may seem obvious, but unless there is a policy in place that all employees know about, a customer’s private data may just go in the trash.Health Care Fraud and Abuse Essay.  That leaves the information vulnerable to dumpster divers who will steal and sell private health information. If an healthcare organization follow all four steps this is reduce the possibility of any fraudulent activity will occur and this is reduce its liability for if/when fraudulent activity takes place within their organization.


Works Cited

Advocacy, A. C. (2011). A Review of Health Care Fraud and Abuse in America.

Agrawal S, B. P. (2012). Physician medical identity theft. PubMedCrossRef , 459-460.

Investigation, F. B. (n.d.). 2011 Financial crimes report. Retrieved May 2012, from

Modern Healthcare. (2010, June 28). The new fraud offensive; It’s time to sto losing billions to fraud each year and redirect those dollars. . United States of America. Retrieved from

Quireshi. (2011). Enforcement Actions involving Medicaid fraud and abuse. Arch intern Med , 785.

Report, N. H. (2008). National Healthcare Antifraud Association Report.

U, R. (2012). protecting the growth of healh care income. PubMedCrossRef , 41-54.

US Department of Health and Human Services. (n.d.). Office of Inspector General. Retrieved June 2012, from US Department of Health and Human Services:

Health Care Fraud and Abuse Essay