Our Medicare system relies on contractors to identify fraudulent claims from the Durable Medicare Equipment (DME) industry. However, time and time again, Medicare contractors have dropped the ball when it comes to identifying even the most egregious instances of fraud. To fully protect our Medicare dollars, the Medicare system has regularly turned to whistleblowers and their counsel to supplement the limited capabilities and resources of DME Medicare contractors.

The most recent enforcement blind spot was revealed in an HHS Office of Inspector General audit of Medicare claims for home blood-glucose test strips and lancets. Reviewing a sample of 100 claims paid in 2007, the Inspector General discovered that 83% of the claims were lacking requisite documentation. In other words, only 17% of the claims should have been paid by the Medicare contractor.

Investigating the problem further, the Inspector General learned that the contractor’s claims processing system was unable to detect whether the claims had the necessary supporting documentation. In short, the contractor was simply not capable of detecting fraudulent claims.

Unfortunately, the results of this audit are not an outlier. By and large, our Medicare contractors are only capable of “processing claims,” and the role of fraud recovery falls on law enforcement, who must engage in a game of “pay and chase.”

The incentives and protections afforded whistleblowers under the False Claims Act have never been stronger. Whistleblowers are often handsomely rewarded, and when it comes to the fraud-prone DME industry, there is plenty of opportunity!

For more information about qui tam law and Medicare fraud, contact Nolan and Auerbach, P.A.