Monday, June 28, 2010

GAO Issues Report on the Government's Strategy to Prevent Improper Medicare Payments. Will it Work?

On June 15, 2010, the U.S. Government Accountability Office (GAO) released a report identifying five important areas for preventing Medicare fraud, waste and abuse. The strategies in this new report, “Medicare Fraud, Waste, and Abuse: Challenges and Strategies for Preventing Improper Payments,” are: (1) Strengthening the provider enrollment process and standards; (2) Improving the pre-payment review of claims through automated pre-payment claim review; (3) Focusing post-payment claims review on most vulnerable areas; (4) Improving oversight of prescription drug plan sponsors; and (5) Developing a robust process to address resolve vulnerabilities to fraud.

Click here for a link to the 15-page GAO report.

GAO Report (Medicare Fraud)

Does anyone think this will make a difference? Notice the action verbs (improving (2x), strengthening, focusing, developing). The GAO seems pessimistic and notes:

As we reported in March 2010, CMS did not establish an adequate process during its initial recovery audit contracting demonstration or in planning for the national program to ensure prompt resolution of identified improper payment vulnerabilities.

Agency officials indicated that they intended to review vulnerabilities on a case-by-case basis and were considering assigning them to risk categories that would help them prioritize action. However, this recommendation has not been implemented.
The report reveals that CMS processes over 4 million Medicare claims every day with almost no accountability. Health care fraud is out of control. Reading between the lines, the government concedes that the problem is too big to handle. Hence, ithe Government will continue to rely upon insiders to blow the whistle and file qui tam lawsuits using the False Claims Act.

Sunday, June 27, 2010

Gulf Oil Spill Cleanup Contractor Facing Prior Qui Tam Suit

Gulf oil spill cleanup spending will be heavily scrutinized for false claims act violations in the coming years, as the cleanup efforts ramp up, and over an estimated $20 billion dollars are poured into the region to mitigate some of the damage from the largest off-shore oil disaster in US history. Already, one contractor working on providing protection to the beautiful beaches of Florida's panhandle region has been accused of prior FCA violations in a contract from 2000 to help rebuilding in Honduras from the devastation of 1998's Hurricane Mitch. The lawsuit claims over $7 million in misrepresentations of labor and equipment charges for money received from the US Agency for International Development, although the defendant company has denied the accusations and taken its own legal actions to get paid. A portent of future fraud litigation and counter-suits involving a variety of contractors in the massive Gulf cleanup effort to come?

Read more in the Pensacola News Journal at:

Mobil agrees to repay the government $32.2 million for underpaid royalties

Mobil Oil and several affiliate companies have agreed to pay $32.2 million to resolve False Claims Act violation allegations. According to the Department of Justice, Mobil Natural Gas Inc., Mobil Exploration & Producing U.S. Inc. and their affiliates “knowingly underpaid royalties” owed from the production of natural gas on American Indian and Federal lands. The Justice Department alleges that from March 1, 1988 to Nov. 30, 1999, the Mobil companies underpaid multiple Native American tribes and the United States due to the systematic understating of the produced natural gas’ value.

Northrop Grumman to pay $12.5 million

WASHINGTON – Northrop Grumman Systems Corporation has agreed to pay the United States $12.5 million to settle allegations that it knowingly submitted false claims to a number of government agencies in connection with electronic parts the company supplied for use in the manufacture of navigation systems for military airplanes, helicopters, submarines and certain equipment used in space, the Justice Department recently announced.