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KATHLEEN SEBELIUS: Good afternoon, everyone. Thank you so much for being with us today.
I'm so pleased to be joined today by my great partner, attorney general Eric holder.
And members of our department senior leadership team to provide an update on the efforts to
stamp out waste and fraud in our health care system.
To protect consumers and safeguard taxpayer dollars.
As the affordable care act has been implemented over the last few weeks, the country has been
getting some long overdue good news about health care.
Small businesses notify that they will receive tax credit starting this year to help them
provide health coverage to their employees. Young adults have learned that they can stay
on their parents' health insurance plans until they turn 26.
And seniors who have fallen in to the so-called prescription drug donut hole are looking forward
to their rebate checks next month that will help them afford their medications.
So slowly but surely Americans are getting more control over their health care the more
consumer health care market for health insurance is taking place.
But unfortunately just as future of our health care system begins to look brighter we are
hearing reports of criminals trying to exploit these changes.
States like Delaware and Wyoming reports have come in that scam artists are already calling
seniors telling them they need to share their Medicare I.D. numbers in order to get the
new benefits. Others have reported that seniors have been
asked for personal information in order to get their new Medicare I.D. card.
Make it clear; there are no new Medicare I.D. cards.
These old crimes are now having new spins. Every year Medicare and Medicaid and private
insurance companies pay out billions of dollars in fraudulent claims.
To cover these claims, we all pay what amounts to a health care fraud tax in the form of
higher premiums. Now, some of the criminals are seeing the
new health insurance reform rules as an opportunity to launch new schemes.
And my message to them today is this. There's never been a worse time to try and
steal Americans' health care dollars. But these criminals may not know is that the
affordable care act is not just about making our health insurance system work better for
families. It also contains some of the strongest anti-fraud
health care provisions in American history. So, under this new law is going to attack
fraud in every single stage of the process. We're going to more thoroughly check health
care providers who want to participate in Medicare or Medicaid.
The days when you can just hang out a shingle and start submitting claims are over.
Next we're going to make it easier for law enforcement to see health care claim status
in different government agencies in one place at one time.
Under the old system we had a data system as police officers from towns weren't able
to talk to each other. We want to give law enforcement agents access
to the big picture, helping them to identify suspicious patterns and claims that can indicate
fraud at the outset. Third, the penalties are increased for fraud.
When you commit Medicare or Medicaid fraud you are stealing from every U.S. taxpayer
and criminals will be punished accordingly. Fourth, we're going to provide new resources
to get more boots on the ground, to fight fraud in communities across the country.
Altogether there is proposed $60 million over the next ten years.
And when experts study the anti-fraud program they find they actually pay for themselves
in money returned to taxpayers much often many times over.
That means going after fraud is one ever the best investments we can make.
These are just a few of the anti-fraud provisions in the affordable care act.
Added together, here is what the changes look like in terms of the perspective of the potential
criminals. It will be harder to submit false claims.
You're more likely to get caught if you do. And when you get caught you are going to face
stiffer penalties. That's a big deterrent.
It's why we believe the affordable care act will not only allow us to identify and prosecute
more episodes of health care fraud, but we believe it will help us prevent fraud from
lapping in the first place. What is going to make these new steps even
more effective is that they are built on a strong foundation.
Over the last 15 months president Obama has led the fight against fraud and the fight
to strengthen program integrity across government. Since January, for example, attorney general
Eric holder hosted the first ever national health care fraud summit and for the first
time brought together government, law enforcement and private insurance officials to share best
strategies for fighting fraud. Out that have conversation we developed a
list of next steps that were already following up on.
The fraud summit was made possible, partly because of the great progress that had already
been made in 2009 with the creation ever the joint HHS-DOJ task force.
Again, first time ever that a cabinet level partnership between the department of health
and human services and the department of justice led to a vastly improved coordination of our
anti-fraud efforts across government and the addition of new Medicare fraud strike force
teams in health care fraud hubs like Detroit and Houston.
To learn more about the agenda and our results I encourage you to visit our website at stopmedicarefraud.gov.
Our department in the justice department is releasing a report to congress that shows
just how impressive these results have been. To talk more about that report in our inter-departmental
fraud fighting efforts I’d like to introduce a great defender ever the American people,
a great partner in fighting health care fraud, attorney general Eric holder.
ERIC HOLDER: Thank you, Kathleen. I'm pleased to join secretary sebelius in
providing an update on our joint efforts to combat health care fraud and specifically
to protect taxpayer dollars on our Medicare and Medicaid programs.
The departments of justice and HHS have a long history of working together in the fight
against health care fraud. Today we are submitting the health care fraud
and abuse control program annual report which outlines the last fiscal year's prevention
and enforcement achievement. This report shows the success of our collaborative
effort to prevent, to identify and to prosecute the most egregious instances of health care
fraud. Over the years we have seen that as long as
health care fraud pays and goes unpunished our health care system will remain under siege.
These crimes harm all of us, government agencies and programs, insurers and health care providers
and individual patients. We're fighting back.
As our latest report shows we have made meaningful, measurable progress.
In fact last year brought record levels of achievement.
In the last fiscal year as result of our joint effort of approximately 2.5 billion dollars
was deposited to the Medicare trust fund. Increase of more than half a billion dollars
over the higher year's total. Also won or negotiated more than $1.6 billion
in judgments and settlements. Justice department's criminal division in
our U.S. attorney's offices open to more than 1,000 new criminal health care fraud investigations
and had more than 1600 health care fraud criminal investigations pending.
Reached an all time high in the number of defendants charged with more than 800 indictments
and nearly 500 cases and close to 600 convictions. The justice department civil division opened
nearly 90 new civil health care fraud investigations and had more than 1100 cases.
These numbers tell only a part of the story. Last year a critical step forward in our health
care fraud fight. The creation that Kathleen describe dollars
of the health care fraud prevention and enforcement action team, better known as -- heat.
We were inspired by common cause and common sense.
To overcome a problem as complex and widespread as health care fraud it was time to redouble
our efforts. Heat has elevated our joint fight against
both civil and criminal health care fraud as a cabinet level priority.
Brings to bear the full resources of the federal government against individuals and corporations
who illegally divert taxpayer resources for their own gain.
And our approach is working. So far heat has enhanced our ability to bring
abuse to light and criminals to justice. And it's enabled the recovery of stolen funds
and the return of million of dollars to the U.S. treasury and Medicare trust fund.
Now, much of this success can be attributed to our Medicare fraud strike forces which
are at the core of heat's law enforcement mission.
From the criminal side through the heat initiative our agencies have expanded strike forces to
seven regions across the country. In south Florida, to Detroit to, Houston where
Medicare data showed hot spots of uncomplained billing levels.
To date, strike force prosecutors from U.S. attorneys offices and justice department criminal
division laugh brought $500 million in court ordered restitution to Medicare program in
nearly 300 health care fraud cases involving more than 560 defendants.
We had 300 guilty pleas have been secured and 250 defendants have been sentenced to
prison; ranging from two months to 30 years. And also on the civil enforcement fund our
health care fraud recovery last year under false claims act exceeded stunning $2.2 billion.
I'm proud of the great work performed by the justice department's prosecutors, agents,
analysts and investigators and also by our partners here at HHS.
These accomplishments show ongoing and intensive efforts to protect the American people and
safeguard precious taxpayer dollars. Our commitment to fiscal accountability combating
fraud and returning resources back to the U.S. Treasury makes the treasury and trust
fund one of the many ways that we are working to help the American people at a time when
budgets are tight. With that, for every dollar that we spend
combating health care fraud we're able to return four dollars to the U.S. treasury and
the American taxpayers. Now, despite our successes we cannot rest,
we must take our work to the next level. We plan to ex plan our strategies and techniques
with the new affordable care act. This law provides new resources and includes
tough new rules and penalties working with our federal, state, local and tribal law enforcement
partners we will use the expanded capability that the affordable care act provides to stop
health care fraud in its tracks. We will work vigorously with all of our law
enforcement officers to include that fraudsters are not used historic legislation to perpetrate
health care fraud on our senior citizens and other vulnerable Americans.
We will punish these criminals to the fullest extent of the law and bring to justice those
who seek to take billions of dollars from the pockets of taxpayers.
Also engaging the private sector in this fight. We will continue to work with industry, leaders
to share information about emerging fraud schemes and to institute effective compliance
and anti-fraud programs. So on that forward looking node I’d like
to turn thing over to one of our dedicated partners the inspector general of the united
states depth of health and human services, Dan Levinson.
DAN LEVINSON: Mr. Attorney general, madam secretary, thank you.
As the attorney general has noted the most recent report of the anti-fraud account of
DOJ efforts reveals very solid and encouraging results in the fight against health care fraud.
And on behalf of our office I would like to thank you, attorney general, and all of your
great teams at the criminal division, at the civil division, at the FBI and U.S. attorney
offices nationwide for being such strong and effective partners and bringing so many of
our cases to a successful close. I would like for a moment to speak to the
program integrity provisions of the new act. Program integrity is foremost in the minds
of everyone in our office as implementation of the new law commences.
The breadth and scope of health care reform alters the oversight landscape many important
respects and our office anticipates assuming wide range ever expanded new responsibility.
To help us meet these responsibilities, the affordable care act provides expanded law
enforcement authorities as the attorney general summarized.
Greater coordination among federal agencies and enhanced funding for the health care fraud
and abuse control program. Examples include expanded access to and uses
of data as well as new exclusion and civil monetary penalty authorities.
Affordable care act also strengthens provider enrollment standards as the secretary noted.
Promotes compliance with program requirements, enhances program oversight and strengthens
the government's response to health care fraud and abuse and ability to hold perpetrators
accountable. Our staff will bring their expertise to bear
throughout implementation and mandated in the affordable care act, will play a critical
role in advising the secretary on implementation efforts.
I'd like to underscore the importance of the health care compliance outreach program because
they are so vital both to the successful implementation of the new law and to our work in the Inspector
General's office. Prevention efforts, such as compliance programs
are integral to curbing health care fraud waste and abuse.
Under the affordable care act providers and suppliers will be required to adopt compliance
programs that meet a core set of requirements to be developed by the secretary in consultation
with our office. We are pleased and we are grateful that the
secretary has made available resources for us to conduct compliance training programs
over the coming year for health care providers and compliance professionals.
The training will focus on methods to identify fraud risk areas and compliance best practices
so providers can strengthen their own compliance efforts and more effectively identify and
avoid illegal schemes that may be targeting their communities.
Thank you very much, madam secretary.
KATHLEEN SEBELIUS: Thank you, Dan. Before we take questions I want to introduce
a few other members of our anti-fraud team who are with us on stage today.
Our new principal deputy administrator for the centers for Medicare and Medicaid services.
The highest ranking official in that agency, she's made sure that we stay aggressive about
rooting out waste and fraud and preventing it from happening in the first place.
Dr. Peter Budetti is also with us today. Peter heads up our new office of program integrity
in the centers for Medicare and Medicaid services. As the health insurance debate unfolded president
Obama and I decided that we needed an office specifically dedicated to eliminating waste
and fraud in Medicare and Medicaid. And we're pleased that we can get someone
with peter's expertise to come and lead that office.
We also plan to create additional program integrity initiatives across HHS to root out
waste and fraud in other department agencies from FDA to NIH to the Administration on Children
and Families. To help these agencies share best practices
we've created a new department-wide council on program integrity.
That will help keep a close eye on everything our department does to ensure we're being
responsible stewards of taxpayer dollars. Finally on stage with me today is Kathie Greenlee,
our terrific assistant secretary for aging. You've heard a lot about the steps we're taking
in government to eliminate fraud. And we take this responsibility very seriously
as I know does the attorney general. You've heard today we're going to continue
to look for new ways to protect taxpayer dollars and go after the criminals who steal them.
But the best protection against fraud is educated consumers.
And that's why over the next few months we'll be working with Kathy and senior groups across
the country to educate America’s seniors about the benefits in the new law and also
how to recognize scam artists who are trying to exploit them.
In the last few weeks alone we've heard stories about people going door to door trying to
sell fake so-called Obama care policies. In other states, seniors were sold policies
that protect them from death panels. One company in Nevada offering a full health
insurance for $29.95. And that included dental coverage.
Not a bad deal, unfortunately too good to be true.
We want to help seniors recognize, resist and report these scams.
And a good model for that very successful program that Kathy's agency already runs is
called senior Medicare patrol. Through the patrol and its army of troops,
seniors are trained to talk to their friends and neighbors to explain how to prevent and
recognize fraud. Since 1997, they have reached over 20 million
Americans. To us that's like having 20 million undercover
police officers on our side. And if you're a criminal, that's a lot more
dangerous to call a senior up and ask for Medicare I.D. number if there's a chance they
might recognize you, recognize what you're doing and turn around and report you.
So, in the next few months our goal is to get even more seniors involved and to send
a clear message to the crooks that fraud doesn't pay.
For years we've tolerated health care fraud. We've accepted that with any big enterprise
there was going to be some waste and abuse. But those days are coming to an end.
As we try to bring down skyrocketing costs across our health care system we can't afford
to ignore the billions of dollars we moved to fraud and theft.
At a time when families are struggling to make every dollar count we must, too.
We've got some evidence today that our strategy is already working as the attorney told you
in his report. And that's very encouraging.
But we're not satisfied. The affordable care act gives us new tools
and resources we need to turn up the heat even higher on crooks across the country.
And we're going to put those tools to work. Thank you and we'd be happy now to answer
your questions if you have some questions. [Not audible]
Yes.
REPORTER: I’m curious to hear if there are plans or provisions to share claims data with
other pairs to get that side also there's a lot of waste on that side of the system
I’d be interested to hear your take.
-- At this point, we're putting together a data system initially to share with our partners
at justice, real-time data that can be monitored and gone after in real-time.
Instead of this sort of pay and chase series to try to monitor the billing aberrations
and with expanded strike force capacity try to knock it down right away.
I know there was some discussion at the health care fraud summit about expanding that radius.
I don't know what the timetable is right now, there some are strategies, frankly, being
implemented in the private sector that we're trying to model in the public sector.
If you think about the way credit card companies have the capability of finding an aberrant
billing pattern, immediately notifying someone or shutting down that opportunity to continue
to abuse what may be stolen credit card that's the kind of system that is very flexible,
very nimble and very quick that we are actually trying to catch up with.
So I think that there are lots of plans to try and continue to involve the private sector
in certainly sharing practices, sharing strategies. I can't tell you exactly what the timetable
is for data sharing and it gets a little complicated given the confidentiality issues that involved
our data system. But we're thrilled at least we're going to
have a system finally over the next couple of years that puts first of all of our data
in one spot. Right now we can't even look at our own data
simultaneously. It's in several different systems and we also
share it with law enforcement partners. [Not audible]
REPORTER: I’d be remiss if I didn't ask you that you're here right now but earlier
today you announced that there were several arrests made in the Times Square bombing it's
now a few hours later and more information has come in.
Anything more you can tell us about those arrests, anything definitely connected with
the bomber, and attempted bombing and what can you tell us that you found out?
HOLDER: at least three arrests have been made at this point in the northeastern parts of
the United States. These are people who are connected to Faisal
Shahzad. We're trying to determine exactly what the
nature of that connection was. There's at least a basis to believe that one
of the things that they did was to provide them with funds and so we are trying to trace
back to see what exactly was the nature of those transactions, what was the purpose of
the sharing of those monies and so part of ongoing investigation.
It is a significant step.
REPORTER: -- there was prior knowledge that these people had this knowledge that this
money was going for a bomb attempt?
ERIC HOLDER: That’s one of things I’m going to try to determine.
-- Thank you. Madam secretary, Mr. Attorney general, I had
a question about the types of fraud, is that are going on, we see justice department press
releases weekly about *** infusion clinics, home health fraud, wondering, you mentioned
some of the false Obama care, quote, unquote, policies.
What other types of fraud are you uncovering and secondly, the law allows the agency to
withhold payment to Medicare and Medicaid providers if there are credible allegations
of fraud pending. I wonder if you can help us define what that
means. -- well, as some of the, I would say there's
likely to be layers of fraudulent activity, some of what we describe today are new sort
of person to person scams occurring, trying to take advantage as you know in the benefit
that will help seniors pay for prescription drugs.
They are eligible for $250 check that benefit has begun to be talked about and checks will
begin being mailed starting in June for seniors who have reached the so-called donut hole.
There are people who have decided that that's a great opportunity to show up at a senior's
door, ask for Medicare numbers, signature on forms suggesting that they will then help
the senior access that benefit. The way the law is written, seniors don't
have to do anything to access the benefit. We can monitor and the checks will be sent
automatically. Seniors should never give an I.D. number or sign anything.
So, we are anticipating those kinds of scams, individuals who figure out that they're going
to take advantage of the situation and try to take advantage of a vulnerable population.
Selling a policy that isn't real, arguably trying to steal information under false pretenses.
Then there's a whole level of, I think, ongoing, much more sophisticated fraudulent activity
perpetrated at various parts of the Medicare system which moves a little over a billion
dollars a day if you put it in perspective to various providers across the country.
So part of what was outlined and I think the inspector general amplified our steps to try
and actually prevent and then in a much more timely fashion if it hasn't been prevented,
find those. There will be much tighter screening for providers
to actually become enrolled in the first place. And verification that wasn't in place before
so people can't just become providers and start billing under false pretenses.
More opportunity to do face to face checks of who is actually setting up shop, more opportunity
to look at data systems and find aberrant billing patterns, tracking things, much more
quickly. As the attorney general said we now have seven
of these strike forces in areas that have been kind of hot spots, but the plan is and
the resources have been provided to expand that footprint for additional strike forces
around the country. And I think it's likely not only reaching
out to the U.S. attorneys but attorneys general getting them engaged involved in both of these
efforts. In terms of the final piece of your question
about the withholding until we determine the actual verification of a billing practice,
we are currently developing we'll be working with inspector general's office, soliciting
information about what that framework looks like.
There's a real tension between getting providers paid in timely fashion so that we don't have
doctors and hospitals and medical providers to delay their ability to be reimbursed for
services delivered and making sure that we are trying to not engage in this sort of pay
and chase methodology. So developing a system where on one hand we're
doing everything to prevent fraud but on the other hand we're paying legitimate providers
on a timely basis as I think the framework that we're going to be developing over the
next couple of months. [Not audible]
Thanks so much for being with us.
-- Thank you.