WASHINGTON--The Department of Health and Human Services Office of Inspector General estimates that it saved the government nearly $17 billion with its anti-fraud activities during the first half of FY 2005.
According to the OIG's Semiannual Report to Congress, from Oct. 1, 2004, through March 31, the savings and expected recoveries include $15.6 billion in implemented recommendations and other actions to put funds to better use, $266 million in audit receivables and $1.1 billion in investigative receivables.
During this period, 1,695 individuals and entities were excluded from participating in Medicare, Medicaid and other federally sponsored health programs. Additionally, 258 criminal actions and 105 civil actions were taken.
The June 13 report cited a number of DME-related examples in the government's efforts to combat fraud and abuse, including:
- Gambro Healthcare, a dialysis services giant, agreed to pay more than $350 million in fines and penalties--one of the largest settlements ever reached by the Department of Justice in the health care industry--after civil and criminal allegations of health care fraud in the Medicare, Medicaid and Tricare programs. The DOJ had accused the company of, among other things, setting up a sham DME company to provide equipment and supplies to home dialysis patients in violation of Medicare regulations and submitting bills for services and medications that were not medically necessary.
- Polymedica Corp. and its wholly owned subsidiaries, Liberty Medical Supply and Liberty Home Pharmacy Corp., agreed to pay $35 million and enter a five-year corporate integrity agreement for allegedly submitting claims for diabetes and nebulizer-related products without proper documentation.
- In Florida, an unnamed DME sales representative was excluded from the Medicare program for 28 years for a criminal conviction of filing false claims for medically unnecessary equipment over three years. The representative also was sentenced to 18 months in jail and ordered to pay more than $2 million in restitution for his role in the scheme.
- Novartis Nutrition Corp. and OPI Properties, subsidiaries of Novartis Finance Corp., agreed to pay $44.7 million in civil damages following a kickback investigation that found the companies offered free enteral feeding pumps to encourage customers to purchase additional enteral nutrition products and submit false claims to Medicare. Additionally, NNC agreed to pay $160,000 for alleged conduct relating to obstructing a federal audit, and OPI agreed to pay a $4.5 million criminal fine and be permanently excluded from all federal health care programs.
- An unnamed DME company owner in Texas was sentenced to 46 months of incarceration and ordered to pay $1.8 million in restitution for a power wheelchair scheme that included billing Medicare for more expensive equipment than she provided.
- In Kentucky, an unnamed DME owner agreed to pay $708,000 in a
civil suit and was ordered to pay a $1,000 special assessment for
paying a doctor and his associate kickbacks in exchange for
qualifying patients for oxygen and referring them to his company.
The OIG also noted that its recommendations to reduce Medicare payments for oxygen--as outlined in the Balanced Budget Act of 1997--saved the government $900 million, and its recommendation to reduce what it called "inherently unreasonable" payments for enteral and parenteral nutrition, equipment and supplies, saved $500 million.
Other suggestions by the OIG still in the works include educating beneficiaries on ways to reduce financial liability for DME and tightening required documentation for blood glucose test strips.
The report is posted on the OIG Web site, available by clicking here.