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Texas cases spotlight Medicare fraud

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Dallas Morning News Editorial

The recent news surrounding federal prosecutors bringing Medicare fraud cases against doctors, pharmacies and marketers in Texas cities provides some justice where it is needed.

The cases in Texas spotlight a scheme involving pharmacy owners and marketers paying kickbacks and bribes to doctors so they'd write prescriptions for unneeded pain and scar creams. One of the patients who received such a prescription died as a result of the toxic effects found in two of the drugs contained in the cream.

She was only 22 years old.

This shows that people entrusted with the care of patients aren't immune from the allure of greed. One pharmacy bought cream for $15 and billed the government $28,000 -- for each tube.

"This is yet another shocking example of how unmitigated greed can spawn a fraud so brazen that it almost takes your breath away," said John Parker, the U.S. attorney in Dallas.

Two of the cases in question account for more than $180 million in fraud. Still, they represent but a fraction of the total cost of Medicare fraud and overpayments every year.

The Kaiser Family Foundation reported recently that Medicare overpayments and fraud within Medicare cost taxpayers $60 billion last year. In fact, such fraud has cost taxpayers a similar sum in each of the last eight years. Unfortunately, federal anti-fraud efforts recoup only a fraction of that amount, just $2.86 billion in 2013.

We certainly applaud the arrests and convictions of bad actors in the field. But more needs to be done to prevent Medicare fraud. Sadly, it is difficult to do much to prevent fraud because any significant changes to fraud laws require congressional action. Such action can be tough to come by.

Texas Sen. John Cornyn, as a member of the chamber's minority party in 2009, introduced legislation that would have given the Centers for Medicare & Medicaid Services, the Department of Health and Human Services and the Social Security Administration additional tools to unravel fraud schemes before they get rolling. But the bill died in committee without action.

Some experts say there are other solutions that would help prevent fraud upfront as well as on the back end.

Currently, for example, the federal agencies with Medicare oversight simply don't have the resources to deal with the volume of new providers that enroll in Medicare -- doctors, physical therapists, nursing homes, ambulance operators, etc.

Ryan Stumphauzer, the former head of the Medicare Fraud Strike Force in Miami, said requiring applicants to answer basic questions about their training and education and whether they are versed in basic Medicare rules and regulations would help weed out the phonies.

Additionally, agencies need to boot bad providers out of the system. In 2011, the Medicare oversight agency identified 34 individuals who still had their Medicare billing privileges despite convictions for health care fraud and tax evasion.

Providing the oversight agencies with the resources to implement these straightforward fixes would pave the way for additional reforms that collectively could save taxpayers tens of billions of dollars a year.

They'd also help prevent the untimely death of patients who trust their providers with their lives.