COMMERCE COMMITTEE DEMOCRATS
Congressman John D. Dingell, Ranking Member
Statement of Congressman John D. Dingell
On the General Accounting Office Report on Medicare Fraud and Abuse at Nursing Facilities

February 7, 1996

Although most medical care providers are honest and bill Medicare appropriately, a wide array of providers -- including durable medical equipment suppliers, laboratories, physicians, optometrists, and psychiatrists--have been involved in the fraudulent or abusive billing of Medicare for services and supplies furnished to nursing facility patients. The evidence suggests that such fraud and abuse is frequent and widespread and could cost the tax-payer billions.

Nursing homes are targets of opportunity for the unscrupulous because many Medicare beneficiaries are located under one roof. One-stop ripoffs can thus involve patients in volume. In many instances, nursing home operators make their patient records available to outside providers who are not responsible for the direct care of the patient. This is illegal, yet it happens all too frequently. Under the present system, providers can bill Medicare directly without the nursing facility or attending physician affirming whether the items were necessary or provided as claimed. Finally, the system for scrubbing claims submitted to Medicare for reimbursement is still inadequate and misses opportunities to avoid paying out large unnecessary sums and to track schemes leading to massive ripoffs. The present system pays out money, and then scrubs the claims later. When a problem does arise, it is called "pay and chase:" first they pay out, then they chase the money after it has landed in the wrong hands.

The Oversight Subcommittee under Democratic control held a number of hearings and spent considerable time on this subject. This year we have spent no effort in this area. Virtually nothing is being done to aggressively investigate any instances of fraud, waste, and abuse. In fact, so bad was the Republican effort to combat fraud waste in abuse in the Medicare program that they actually suggested major changes that would have in fact rolled back anti-fraud efforts for federal prosecutors, according to testimony from the Department of Justice, the General Accounting Office, the HHS Inspector General and the Health Care Financing Agency. We had to hold a special Democratic hearing with Secretary Shalala and Inspector General June Gibbs Brown about how the Republican Medicare legislation would undermine fraud-fighting efforts. The majority has also attempted to slash the budgets of all of the federal anti-health care fraud fighters including the GAO, the FBI, and the Inspector General.

It seems plain to me that before we plunge ahead with drastic Medicare cuts, we ought to close the windows of opportunity through which rascals and thieves steal from the taxpayer and the elderly. This report gives us several good suggestions on where to start.

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Contact: Dennis Fitzgibbons (202/225-3641)



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