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Lessons in Health Care Fraud

Waste, theft and fraud subject people to dangerous procedures and deprive deserving patients of the care they need.

Posted by Dawn Lomer on November 23rd, 2011

If I took one thing away from the NHCAA Institute for Health Care Fraud Prevention Annual Training Conference last week, it’s that there are as many health care fraud schemes as there are ailments. And aside from the billion dollar-losses it incurs each year, health care fraud takes an equal human toll on the millions of people whose lives it touches.

Like most of the exhibitors at the conference, we were giving away an i-Pad. But unlike the other exhibitors, we asked participants in the draw to tell us their best fraud bust story in order to enter.

Fraud Stories Galore

We heard it all, from fake doctors to drug-dealing-dentists, and from billing for services not rendered to performing unnecessary and dangerous procedures on unsuspecting victims. All the stories had something in common: people in privileged positions of trust betraying the people who come to them for help. And while many of the stories were simple matters of doctors, dentists, chiropractors and physiotherapists upcoding to make extra money, the theft of billions of dollars from Medicare, Medicaid and private insurance companies hurts every person who needs these services now and in the future.

The good news is that detection methods for health care fraud are becoming more and more sophisticated every year, and the people investigating these crimes are getting more and more knowledgeable and sophisticated too.

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A lead investigator from John Hancock Financial Services revealed some of the latest techniques investigators are using to uncover the myriad life insurance fraud schemes.

In a session on social network analytics presented by Lexis Nexis I learned how investigators use computer programs to uncover hidden relationships. By using powerful tools to reveal connections between people, assets, entities, property and medical providers, data analysis can reveal collusion within a payer’s network.

I listened to an eye-opening overview of organized crime in health care and some of the sophisticated schemes being used. The Director of the Investigations Unit at the US Department of Health and Human Services, Office of the Inspector General, talked about trends, geographical associations, and how the OIG fights the problem.

In a session on undercover operations, a chiropractor and an investigator gave practical instructions and demonstrations of how to conduct a successful undercover “sting”. It was a real-life CSI episode. They discussed how to develop a fictitious identity and how to avoid tipping off the subject.

Psychologist Kirk Kennedy talked about interviewing people from other cultures. He explained the differences in communication styles and provided practical advice for overcoming obstacles and avoiding pitfalls in communication with people from group-oriented cultures. His advice applies to any life situation in which effective communication with those of different cultures is imperative.

The 2011 investigations of the year put into perspective the human cost of health care fraud. I was transfixed by the story of the Sharmas, a doctor-couple who bilked the system of millions of dollars, and got away with it for 10 years before a specialized team of investigators broke up the conspiracy. The team used camera surveillance to gather evidence, reviewed 1,000 boxes of records and interviewed more than 100 witnesses. In the meantime, thousands of people received dangerous and unnecessary injections and prescriptions for controlled substances. And the millions the Sharmas snatched from the system didn’t go towards treating the many people who need reliable medical treatment every year.


Dawn Lomer
Dawn Lomer

Manager of Communications

Dawn Lomer is the Manager of Communications at i-Sight Software and a Certified Fraud Examiner (CFE). She writes about topics related to workplace investigations, ethics and compliance, data security and e-discovery, and hosts i-Sight webinars.

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