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Boston Health Care Fraud Prevention Summit

December 16, 2010
Boston, MA


Remarks as prepared for delivery

Thank you, Attorney General Holder. It has been a real pleasure to work with you to get criminals out of our health care system over the last two years. I also want to thank all of our panelists for their participation today.

A special thank you to our terrific anti-fraud leadership team for their tenacious work: Regional Director Chris Haeger, Deputy Administrator Peter Budetti, Assistant Attorney General Tony West, US Attorney Carmen Ortiz, and Inspector General Daniel Levinson.

Thank you as well to Chancellor Motley and all of our hosts at UMASS Boston for opening their doors to us and helping to make today’s meeting possible.

As you know, the work we’re doing together here today – sharing best practices, and developing new strategies – is all part of a national conversation that began in January at the National Summit, and has continued at meetings like this across the nation.

In South Florida, Los Angeles, and Brooklyn, we brought together people like you who are fighting fraud on the frontlines. Next year we will visit Detroit, and Philadelphia. Today, it is good to be in Boston, a city that has always been a leader in health care: an incubator for new treatments, new medicines, and new models of care.

And we are counting on you to be a leader in our fight against health care fraud too.

As 2010 winds down, we can look back on what has been a remarkable year in fraud prevention.

As Attorney General Holder explained, our strike forces have been making a real impact, recovering more money and shutting down more operations than ever before.

That success has already put Medicare on surer footing. Since announcing our HEAT collaboration last May we have charged over 500 defendants with seeking to defraud Medicare of more than one billion taxpayer dollars.

And in March, President Obama signed the Affordable Care Act, which is not only expanding coverage and improving the quality of care, but is also one of the strongest health care fraud prevention bills in history.

Thanks to the law, we have begun to establish tougher Medicare provider screenings and criminal penalties, all while providing $350 million in additional resources to help coordinate Federal, State, and local fraud fighting efforts.

Last month, we proposed new rules to help states reduce improper payments for Medicaid health care claims.

And we have also moved aggressively to establish competitive bidding among medical equipment suppliers that will save taxpayer money and make products like hospital beds and wheelchairs harder targets for criminals looking for an easy score.

So we have reason to be proud. In 2009 we made more progress fighting health care fraud than in 2008. In 2010, we did even better than 2009. We’re moving forward with real momentum and we are using it to make a real impact.

But we also have an opportunity to go further, do more, and strengthen our ability to prevent fraud before it ever occurs.

That means enhancing the tools and the technology we have to stay ahead of criminals and identify their patterns of behavior early, instead of waiting until a fraudulent payment is long out the door, then trying to chase it down and recover the funds.

We have started by giving law enforcement the ability to see health care claims data from around the country in one place. But we are also working to improve CMS’s ability to keep bad actors from joining the Medicare and Medicaid programs in the first place.

In one pilot program, our Centers for Medicare and Medicaid Services partnered with the Federal Recovery Accountability and Transparency Board to investigate a group of high-risk providers.

By linking public data with other information like fraud alerts from other payers and existing court records, we were able to determine that something wasn’t right:

Several individuals were co-owners of multiple companies which happened to open on the very same day at the very same location using the provider numbers from physicians in other states.

So we took a closer look. Two of the individuals were already under investigation for potential Medicare fraud, and a third individual linked to the first two is now under investigation as well.

We know the power that comes with having all the information available to you. Add to that the latest technology to analyze that information, and we can get a head start when it comes to spotting schemes and tracking down criminals.

That is why I am proud to announce today that the Centers for Medicare & Medicaid Services has issued a solicitation for state-of-the-art analytic tools to help the Agency predict and prevent potentially wasteful, abusive or fraudulent payments before they even occur.

These tools will build on many of the pilot programs already taking place under the Agency, strengthen our front-end detection work, and complement our HEAT collaboration with the Department of Justice.

These are the same type of predictive modeling tools that banks and insurance companies use to identify potential fraud before it occurs.

They are how your credit card company can raise the alarm if they see a dozen flat-screen televisions charged to your card in one day.

And it’s about time we put the same technology to use when it comes to protecting our health care system.

Using just this kind of sophisticated predictive modeling, acting with new and expanded authority under the Affordable Care Act -- and through its own investigations -- CMS has already identified a number of “false fronts” in Houston, Texas. The agency is taking administrative action to remove them from the program and expects to take even more actions in the Houston area.

With the use of state-of-the-art predictive modeling tools, we can vastly expand our ability to prevent bad actors from enrolling as a health care provider or supplier in the first place, while strengthening our ability to track billing patterns in real time to identify trends that indicate fraud.

The success we’ve seen over the last year has been built on initiatives like these combining data with new resources and cutting-edge technology.

Of course, no technology is as effective at preventing fraud as seniors who are educated and informed. With the support of our great Assistant Secretary for Aging Kathy Greenlee, and partner organizations across the country, there are more than 5,000 Senior Medicare Patrol volunteers giving their friends and neighbors the tools to recognize, resist, and report fraud.

Over the years, they have helped to return more than $100 million to the trust funds over the years, creating a powerful deterrent for anyone thinking about trying to rip off seniors.

And with a $9 million grant recently announced to strengthen the Senior Medicare Patrol, we’re empowering even more seniors to protect themselves and their Medicare benefits.

At the same time providers are playing their role as well, making sure their colleagues are trained and prepared to meet their legal and ethical responsibilities.

That’s why the Department’s Inspector General has developed “A Roadmap for New Physicians.” This program is going out to medical schools across the country and it explains the laws that apply to physicians so they can comply with federal law, avoid liability, and spot the signs of potential fraud.

Like investigators, and Medicare beneficiaries, we need physicians to be full partners in our effort to keep our health care system strong.

Each of these efforts are a small piece of a major commitment to keeping Medicare strong, and to honoring our responsibility to America’s seniors.

We are seeing a genuine consensus among, providers, law enforcement, consumers that by working together, we can make health care fraud a losing proposition for any criminal who even thinks about targeting the system.

The Kennedy Library just across the street from here is also home to the papers of Ernest Hemingway, who once said: “Never confuse movement with action.”

The truth is that in the past, we fought hard against health care fraud. But without the resources, the tools or the technology to keep up with criminals who were always one step ahead, and schemes that continued to grow more sophisticated, we made little impact and saw little progress.

But that’s changing. Today we are taking action.

Over the last two years we’ve built on your best practices and worked together to coordinate strategy. We’re no longer waiting for criminals to trip up. We’re going after them. We’re pooling our resources and our knowledge. We’re identifying the bad actors early, tracking the large criminal enterprises and shutting them down.

So thank you again for being here. I look forward to seeing what ideas come out of your discussions as we work to free our health care system of waste and fraud.

Thank you.