Preventing of Fraud, Waste and Abuse in Medicare

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Fraud, waste and abuse prevention in Medicare is a hard task that needs full commitment of those entrusted in it. It should encompass government oversight, key compliances processes, training and disciplinary procedures.

For any of these actions to succeed types of fraud, waste and abuse in Medicare should first be understood. Fraud, waste, and abuse include comes in terms of false claims. It practically means asking the government to pay an item or service that was not or should not be provided. It is an attempt to steal from the government. It is an attempt to defraud the government. False claims include request for payment s for altered, forged prescriptions: Shorting, which entails partially filling the prescription quantity prescribed but at the same time charging for full prescription with no arrangement to pick up the remainder: Submitting the same claim twice or double billed prescription: Claims that are submitted to multiple payers for same prescription: Claiming for a more expensive brand name prescription drug when a generic was dispensed: Prescription of drugs supposedly dispensed as written although they were not:  and finally improperly keeping an overpayment. (University of Phoenix .n.d.)

False Claim Act is one of the federal government efforts to prevent this crime.  This act prohibits consciously presenting false payment claim to the federal government, forcing someone else (e.g. a plan sponsor or pharmacy Benefit Manager) to submit a false claim for payment to the federal government, making or using false documents to get a claim paid by the federal government, scheming to get a false claim paid by the federal government, avoiding or decreasing obligation to pay or reimburse the federal government through making or using a false record. In addition to this, the False Claim Act also protects who reports plans to defraud the federal government i.e. the whistle blowers. The act prohibits any retaliation against employees who report or aid in investigation of false claims. It also states that there should be no negative employment consequences such as being demoted, fired and being suspended from the employment.  Additionally, the act provides for potential remedies to any retaliation which include job reinstatement accompanied with double back payment and any other necessary special damages. (University of Phoenix .n.d.)

The other measure has been federal penalties. Various federal penalties could include heavy financial penalties, criminal prosecution and exclusion from participating in Medicare and Medicaid. A company employee or an individual may also sue anyone involved in fraud on behalf of the government. To encourage such moves by individuals, the plaintiff is entitled to a share of total award while the remainder goes to the government. State false claims acts have also recently been increasing in number. Deficit reduction encourages state false claims statutes

The government has also sought anti-kick back statutes which make it a crime to knowingly and willfully offer, pay, solicit or receive any remuneration to encourage reward referrals of patients who receive items or services under government health care program coverage.  Those involved in such acts may be imprisoned, fined, excluded from Medicare and Medicaid, face very costly civil penalties,  or be prosecuted under various similar state laws. (University of Phoenix .n.d.)

It is possible to bring dispensing and billing complaints against pharmacies: such complaints may be against deceptive marketing about plan benefits, cases where billing for drugs is not provided, billing to someone else plan card, illegal substitution of drugs, overcharging and other issues related to pricing,  asking extra uncompensated amount from  the beneficiary, any gift given as an incentive to enroll in a particular plan and directing beneficiary to a certain plan in exchange for payments by that plan.(University of Phoenix .n.d.)


Setting up of compliance programs make sure that statutory and regulatory requirements are met.  This should be ensured through setting code of ethics to ensure medical practitioners are committed legal and ethical obligations, clearly specify all employees duties, and inform employees of the consequences of not performing such responsibilities. Strict enforcement of such code of ethic should be emphasized. Including compliance officer will also help prevent waste, abuse and frauds in Medicare and Medicaid. The compliance officer duties should be to enforce code of ethics, development, implementation and enforcement of the program, oversee the compliance training, development and implementation of a compliance system, following up all cases of alleged frauds and abuse, reporting any potential fraud and abuse to the relevant authorities, conducting internal audits and monitoring provision of the services as well as billing practice. (University of Phoenix .n.d.)

In addition to this, it may be necessary to establish a compliance committee depending on company size. This committee should work hand in hand with the compliance officer and also provide an oversight and direction to the compliance officer. Plans to operate compliance programs should also be instituted. This should include the reviews of the contracted pharmacies and also partnering with other non company parties in conducting the compliance activities.

Those who work under Medicare and Medicaid programs should undergo training to familiarize the trainees with issues of waste, fraud and abuse, educate them about obligations under the program, spotting and reporting fraud, abuse and waste, the rights of those who may report potential waste, fraud and abuse. The confirmation of annual training should be met. Such training may be specialized or general. Employees who are more intimately involved in providing services under federal health care programs should undergo specialized training that will focus on additional elements relevant to them. Employees who need specialized training are those who deal with dispensing drugs, filling claims, billing coding, sales as well as marketing of health care products and services.  Reporting of the cases of potential fraud, waste and abuse should also be made easy.  It may be directly to the supervisor, appropriate department or through a centralized system at place of work. Confidentiality of this information should also be assured as the law requires. Sponsors to plan may also have hotlines for reporting beneficiary or subscriber fraud, waste and abuse.  In reporting of suspected non compliance, the reporters should be urged to report much details as possible which should include the description of the of the type of conduct at issue, individual suspected of the conduct and any documentation which reflect the conduct in question. The investigation of the case may be required to call upon the reporter for more information and the outcome will dictate the necessary action, such action may include corrective measures to avoid such future occurrence, any of the stipulated disciplinary action or both. Other steps may include making a referral to federal law enforcement agency, relevant plan or authority. Follow up of any timely made complaints should be emphasized.  It should to the knowledge of all employees that they have a duty to report any suspected fraud, waste and abuse as well as cooperate in any resulting investigations. Any employee who fails to live up to such duties should be subject to disciplinary action, termination or retraining. The compliance officer together with the human resource and legal departments should work together in determining action to be taken against any employee who fail to live up to this duty. (University of Phoenix .n.d.)

It should be made a law and essential part of Medicare and Medicaid Programs Company not to retaliate to any employee who reports, potential fraud, waste or abuse in good faith. Retaliation should not be imposed and be tolerated even in cases where good faith allegations are not sustained after the investigation. The employee who reports such cases should not be subject to reprisal, disciplinary action or reprimand, fired and demoted. The non retaliation policy should however not protect poor work performance and therefore individual who report wrong doings may be subject to disciplinary action owing to poor work performance or violation of any set policy. (University of Phoenix .n.d.)

Disciplinary procedures for non compliant conduct should take the following course:  First, appropriate department should conduct an investigation which should include an interview with the potential witness, review the documentary and determine the appropriate method on a case-by-case basis. The second step will depend on the outcome of the first step. If non compliance conduct is found, some steps may be taken. Compliance officer should notify the appropriate officials, remedial action such as reprimand, suspension, retraining, moving the non compliant employee into another position or termination may be taken. Corrective action may also be taken so as to avoid occurrence of similar non compliance instance in future. It may also be necessary to notify the appropriate federal authority. Employee found not to have complied can be excluded from participating in the provision of health services under federal health care programs. (University of Phoenix .n.d.)