Difference Between Medicare Fraud And Abuse

Healthcare fraud, while there can be simple billing errors that can create this, Medicare fraud normally arises when a physician, provider, or supplier is trying to steal from Medicare by fabricating services or products given to patients. While most people consider Healthcare fraud the same as Healthcare abuse, there is a big difference in meaning. Abuse differs, because abuse is committed when healthcare providers do not use Medicare’s processes which can exponentiate the costs to Medicare. There is a big difference between fraud and abuse, fraud is act committed with intention to rob money from Medicare while abuse is normally due to more paper management or documentation. (Coffin)
Originally Medicare had Fee-for-Service Payments, where
To ensure the reduction of costs, and to improve quality service, congress integrated enticements to ensure excellent service while stopping the growth of costs in Medicare. Value-based payments are different from fee-for-service payments because they ensure quality over amount, because what it does is ties reimbursement to a physician if there is evidence that shows they provide good service. This process began in 2003, where every hospital would receive reimbursement based on their quality, which was scored. Hospitals scored in the top decile would receive a 2% reimbursement, while hospitals in the second decile would only receive 1% bonus. Due to hospitals complaining that they did not receive reimbursement just because they were not in the top deciles, the system was reformed. They changed it in 2007 to where hospitals would receive bonus money from their improvement over the year, by 2011 the composite quality in 216 hospitals improved by an average of 18.6%. After that year, they updated this to where they withhold the 1% of compensation and would pay it over the course of the year if they continued to adhere to the clinical quality guidelines. This would be determined based on performance records and surveys from the
There are too many loop holes in the system where people who have little to no knowledge in this area are figuring them out because they know how to use a computer. According to the American Medical Association in 2011, they estimate that fraud costs totals between $82 billion and $272 billion dollars in wasted healthcare spending. This amount is about 21% of the total budget for the program. This shows the amount of money being stolen, not only from tax payers but also from the patients who may need the funds for their medical needs. (practice fight back) In an article about congress hearing related to healthcare fraud, a specific example shows how easy it has become to commit fraud, it explains how a Nigerian immigrant named Aghaegbuna Odelugo came to America to earn his master’s degree. He shortly ended this endeavor because he easily seen loop holes in the Medicare program, so he committed fraud over fraud and earned millions of dollars. He wasn’t caught until he had already stolen about $9 million dollars total in 3 years, during that time he had worked for several companies across the states. In his court hearing he said that committing fraud was extremely easy if the person can enter basic data entries into computers. The article then continues to state that in another