Fraud In The Healthcare System


On June 28, 2018, the U.S. Attorney’s office of the Middle District of Florida announced:

National Healthcare Fraud Takedown Results In Charges Against 601 Individuals Responsible For Over $2 Billion In Fraud Losses. Largest Health Care Fraud Enforcement Action in Department of Justice History Resulted in 76 Doctors Charged and 84 Opioid Cases Involving More Than 13 Million Illegal Doses of Opioids.” 

The announcement is just one of the many successful operations in bringing healthcare fraudsters to justice.

This desperately needed action is a drop in the bucket compared to how much was actually stolen through fraud. First, what is the cost of American Healthcare? And second, how much is actually stolen?

  • American Healthcare cost 2017:  $3.5 trillion, over $10,000 per year per American.
  • Predicted for 2026: $5.7 trillion. (Health News, Feb 14, 2018.)
  • The National Heath Care Anti-Fraud Association says that fraud could cost the nation as high as 10 percent of annual health care expenditure.
  • The Grim truth is we really don’t know how much has actually been stolen.

Massive, Widespread Fraud

            This is a drop in the bucket of the offenders when it comes to the massive fraud that goes on in the United States in the healthcare business.  Given that the low hanging fruit of big insurance and federal money is right there for the easy picking, then it is inevitable that thieves are drawn there with their baskets, gathering as fast as their little felonious hands can pick.

The Florida bust only chased down a few of the vermin that steal our money on a regular basis. Yes, our money.  Medicare is financed by taxes that you and I pay. Medicare is being bilked and milked every day by these jackals and hyenas who wear the white smocks embroidered with the Caduceus and wearing the sacred oath they once pledged: “First do no harm,” the sacred injunction of the Hippocratic oath.

Just How Bad Is It?

In a July 19, 2017 article by Fred Schulte from a publication in The Center for Public Integrity* entitled, Medicare Advantage Money Grab, Fraud and billing mistakes cost Medicare — and taxpayers — tens of billions last year, he said:

“Federal health officials made more than $16 billion in improper payments to private Medicare Advantage health plans last year and need to crack down on billing errors by the insurers," a top congressional auditor testified Wednesday.

James Cosgrove, who directs health care reviews for the Government Accountability Office, told the House Ways and Means oversight subcommittee that the Medicare Advantage improper payment rate was 10 percent in 2016, which comes to $16.2 billion.

Adding in the overpayments for standard Medicare programs, the tally for last year approaches $60 billion — which is almost twice as much as the National Institutes of Health spends on medical research each year. *Winner of 2014 and 2017 Pulitzer prize.

In Thomas Beaton’s November 13, 2017 article entitled Top 5 Most Common Healthcare Provider Fraud Activities, published in Healthpayer Intelligence, he describes in detail the five common targets for thieves. These are:

  • BILLING FOR MEDICALLY UNNECESSARY SERVICES OR SERVICES NOT PERFORMED
  • FALSIFYING CLAIMS OR DIAGNOSES
  • PARTICIPATING IN ILLEGAL REFERRALS OR KICKBACKS
  • PRESCRIBING UNNECESSARY MEDICATIONS TO PATIENTS
  • UP-CODING FOR EXPENSIVE, MEDICALLY UNWARRANTED SERVICES. (charging for a more expensive payment code than needed or performed)


Earlier Fraud Recoveries

This is from a report from the U. S. Department of Justice, dated December 21, 2017:

“The Department of Justice obtained more than $3.7 billion in settlements and judgments from civil cases involving fraud and false claims against the government in the fiscal year ending Sept. 30, 2017. Of this amount, $2.4 billion involved the health care industry, including drug companies, hospitals, pharmacies, laboratories, and physicians. This is the eighth consecutive year that the department’s civil health care fraud settlements and judgments have exceeded $2 billion. The recoveries included in the $2.4 billion reflect only federal losses. In many of these cases, the department was instrumental in recovering additional millions of dollars for state Medicaid programs.”

Examples of Companies in the "Take Down"

It was also reported that over $900 million, the largest recoveries made, came from the drug and medical device industry. For an example, Shire Pharmaceuticals, LLC, paid $350 million for offering lavish dinners, drinks, entertainment and travel, bogus case studies, medical equipment and supplies, and other illegal enticements to clinics and physicians to use or overuse its bio-engineered human skin substitute.

How about this one involving Mylan, Inc.?  That company paid around $465 Million to resolve charges that it underpaid rebates owed under the Medicaid Drug Rebate Program by erroneously classifying its patented brand name drug, Epipen, as a generic drug to avoid paying higher rebates. It increased the price by over 400% and paid only a fixed 13% rebate to Medicaid by misclassifying it as generic.

“Another day, another infuriating bit of news about Mylan’s pricey — and lifesaving — EpiPen: Pharmaceutical industry experts estimate that the medicine and its auto-injector, for which Mylan charges roughly $300 a pop, cost around $30 to produce.” Article by Martha White, September 7, 2016, Money Magazine.

This list goes on and on, and this short list of offenders “taken down” only includes those perpetrators who were caught because they simply were so greedy that it became politically unavoidable and had to be brought to some resolution.  Countless others, larger and smaller, are rats gnawing at honest caregiver’s attempt to provide healthcare to an ailing America. And even with these huge sums paid, it is just considered as cost of doing business to Big Pharma, the pharmaceutical industry.

Honestly Is The Best Policy

Well, it depends on who is applying the policy. These criminal pharmaceutical companies, like Mylan and Shire, and a litany of others that could occupy this page, single spaced in four columns, simply don’t believe or follow that policy. The stockholders care less about anything but profit, and management is not into healthcare—just chemical manipulations that affect human metabolism, structure and other effects created on the body and mind made and sold at what the market will bear.

They are not bound by any oath to do anything to help mankind, as are the MDs and others in the industry who are so bound, yet still commit acts that reduce their moral and social standing to that of miscreants who pose as healers, using the badge to get rich. Those who over prescribe opioids are enemies of society and humankind because of the resultant addiction and harm to our society and culture.

The Good Thing

The good thing is that the great majority of doctors and healthcare providers hold to the line of ethics and maintain their duty to help others. It is the duty of doctors, nurses, practitioners, to report the offenses they see or know about.  It is a source not just of embarrassment to the profession but lowers its esteem and respect by the public and its efficacy as credible healers. The crimes of these fellows bleed over to every ethical physician. To heal American healthcare, it is the duty to stop this, for it harms all of us.

Integration Is The Answer

The integration of practices of MD’s, Chiropractors and other caregivers, is a solution for the emphasis is on total compliance and no risk of violation of law or ethical standards. An integrated practice is a collaboration of healing modalities that really heal, rather than just treat and subdue symptoms by drugs as seems to be the common practice of the day.  The integrated practice provides a collaboration of expertise and training in diagnosing and treating each individual patient, to get the best result to make the patient well.

What Integration Does For The Doctor

Advanced Medical Integration, with its years of experience, provides a step by step system in integrating your office. Experience in integrating over 300 clinics nationwide has proven that the enhanced income factor in an integrated clinic is increased by 3X in many cases. It frees the doctor to have time with the family and a life rather than being locked into a personality driven practice. It is the answer to providing top notch healing for the patient that heals rather than treats symptoms. That, with its use of Regenerative Medicine, is the vision of the future available now.

Visit www.amidoctors.com. Watch a video by Dr. Mike Carberry, CEO and pioneer creator of the perfect Medical Integration Clinic. Dr. Carberry has created a simple, smooth, and easy way to transition your practice to an integrated clinic, with you, doctor, as owner operator, and all of the professional, financial and patient help benefits you originally dreamed of.