Health Reform Could Mean More Fraud Enforcement—And More Fraud

The Obama administration has made it clear that cracking down on healthcare fraud and abuse is a priority, and the latest version of the America's Affordable Health Choices Act of 2009 includes language that will further increase funding to ensure that government money is not lining the pockets of fraudsters.

That increase in enforcement will be essential if more people are covered under a government system, according to Robert A. Wade, Esq., partner at Baker & Daniels, LLP, in South Bend, IN.

Wade says he would expect an uptick in fraud and abuse cases if the reform passes simply because there will be more people covered and more money being funneled through the system. If more people are covered under a federal program, more claims would fall under the False Claims Act and Stark Law.

Some opponents of a government-run healthcare system cite the high level of fraud and abuse in the Medicare and Medicaid programs as a sign that the government is incapable of running an efficient system. However, experts argue that government programs are no more susceptible to fraud and abuse than private insurers.

"If a physician or [healthcare] entity has the capacity to commit fraud, they will do it regardless of which bucket they are taking from," said Wade.

A report from the George Washington University Medical Center in Washington D.C. titled Health Insurance Fraud: An Overview concurs.

"What is absolutely clear from virtually every reliable source on the subject is that health care fraud is a systemic problem affecting public and private insurers alike, in the individual market, the employer-sponsored group market, and public programs," the report stated.