March 1, 2013

Medicaid Waste: Billions on Poor Long-Term Senior Care Services

by Levin & Perconti

In recent weeks we have discussed the federal False Claims Act which seeks to protect taxpayers from wasteful spending on programs like Medicare and Medicare. Unfortunately, with hundreds of billions of dollars spent each and every year it remains difficult for federal regulators to ensure that every dollar spent is going toward necessary, efficient care. For those service providers with less scruples, it may be tempting to game the system, cut corners, and act outright fraudulently to attract more and more reimbursements.

One need only look so far as the front page of any newspaper today to identify the need to be serious about efficiency with public funds. Today marks the beginning of the “sequestration” cuts, which will enact nearly $85 billion in automatic budget reductions affecting many different programs and agencies. Medicaid and Medicare are mostly spared from this particular round of cuts, but any compromise to end the cuts may include reduction in payouts for these programs.

Understanding that background makes stories like the one posted in the Star Tribune quite infuriating. The reports explain how government investigators recently revealed that over $5 billion in Medicaid funding may be wasted on certain skilled care--specifically in bad nursing homes. The findings were part of a report released by the inspector general from the U.S. Department of Health and Human Services.

That $5 billion figure is eye-popping and refers to all payments to facilities that went to facilities that did not meet basic safety requirements. The findings are a double whammy, indicating waste and neglect of seniors . The report noted that “not only are residents often going without the crucial help they need, but the government could be spending taxpayer money on facilities that could endanger people's health.”

The report documents a wide range of problems which violated standards. They range for negligent oversight of basic protocols--like conducting an individual assessment upon admission--to those which may have been motivated by the financial goals of the facility. For example, in many cases unnecessary therapy was found. Those therapies were either duplicative or wasteful, but in all cases they cost taxpayers funds. It doesn’t take much imagination to realize why a facility that receives public funds, like a hospital or medical clinic, might have incentive to provide a service to collect a reimbursement, even if the service is not necessarily essential.

Speak Up Against Wasteful Care
The False Claims Act includes qui tam or “whistleblower” provision which provide legal avenues for employees of various facilities, including hospitals and nursing homes, to step forward with information about fraudulent practices. The employees are then able to receive a portion of the recovered funds as incentive for demanding fairness. If you have any information about incorrect billings, unnecessary services, or wasteful practices which drain Medicare and Medicare funds, please get in touch with our attorneys to see how we can help.

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