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OSI-00-1R 1 (1999-10-05)

handle is hein.gao/gaobaalqz0001 and id is 1 raw text is: SGAO Accountabiity Integrity * Reliability United States General Accounting Office Office of Special Investigations Washington, DC 20548 B-283695 October 5, 1999 The Honorable Susan M. Collins Chairman Permanent Subcommittee on Investigations Committee on Governmental Affairs United States Senate Subject: Health Care: Fraud Schemes Committed by Career Criminals and Organized Criminal Groups and Impact on Consumers and Legitimate Health Care Providers Dear Madam Chairman: This report responds to your July 27, 1998, request that we provide you with information concerning the nature and magnitude of illegal activity by career criminal and organized criminal groups posing as health care providers for the purpose of defrauding federal, state, and private insurance systems. Both Medicare and Medicaid programs, because of their size and complexity, are vulnerable to fraud and abuse. We have reported previously about the importance of controlling health care costs, especially in the federal government.' Controlling fraud is part of the remedy for controlling health care costs. In fiscal year 1998, the latest year for which statistics are available, Medicare paid out more than $193 billion and Medicaid spent approximately $177 billion. The Coalition Against Insurance Fraud, using private insurance information provided by the Health Insurance Association of America and public insurance information supplied by the Health Care Financing Administration (HCFA), estimated the dollar amount of nationwide health care claim fraud for 19972 to be $53.9 billion. Of this amount, approximately $20 billion was attributed to fraudulent private insurance claims; and approximately $34 billion was attributed to fraudulent public insurance claims, including Medicare and 1Medicare: HCFA's Use of Anti-Fraud-and-Abuse Funding and Authorities (GAO/HEHS-98-160, June 1, 1998); Private Health Insurance: Continued Erosion of Coverage Linked to Cost Pressures (GAO/HEHS-97-122, July 24, 1997); Medicaid Fraud and Abuse: Stronger Action Needed to-Remo ve Excluded Providers From Federal Health Programs (GAO/HEHS-97-63, Mar. 31, 1997); High Risk Series: Medicare (GAO/HR-97-10, Feb. 1997). 2 The most current year for which statistics were available was 1997. GAO/OSI-00-1R Criminal Groups in Health Care Fraud

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