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What GAO Found

Why GAO Did This Study

This testimony discusses our work regarding health care fraud in Medicare and to discuss strategies that could help reduce fraud. Since 1990, GAO has designated Medicare as a high-risk program, as its complexity and susceptibility to payment errors from various causes, added to its size, have made it vulnerable to fraud. Since 1997, Congress has provided funds specifically for activities to address fraud, as well as waste and abuse, in Medicare and other federal health care programs.

In fiscal year 2011, the federal government allocated at least $608 million in funding to investigate and prosecute Although there have been convictions for multimillion dollar schemes that defrauded the Medicare program, the extent of the problem is unknown as there are no reliable estimates of the magnitude of fraud in the health care industry. Fraud is difficult to detect because those involved are engaged in intentional deception. According to the Department of Health and Human Services' Office of Inspector General (HHS-OIG), common health care fraud schemes include providers or suppliers billing for services or supplies not provided or not medically necessary, purposely billing for a higher level of service than that provided, misreporting data to increase payments, paying kickbacks to providers for referring beneficiaries for specific services or to certain entities, or stealing providers' or beneficiaries' identities.

Since 1997, Congress has provided funds specifically for activities to address fraud, as well as waste and abuse, in Medicare and other federal health care programs. In fiscal year 2011, the federal government allocated at least $608 million in funding to investigate and prosecute cases of alleged fraud in health care programs. The Centers for Medicare and Medicaid Services (CMS)--an agency within HHS--oversees Medicare, Medicaid, and the Children's Health Insurance Program (CHIP). Along with its contractors, CMS works to reduce fraud. The HHS-OIG along with the Department of Justice (DOJ)--including its Criminal and Civil Divisions, the U.S. Attorney's Offices (USAOs) throughout the country, and the Federal Bureau of Investigation (FBI)--work together to investigate and prosecute cases of health care fraud.

This testimony focuses on the types of providers that have been investigated for fraud and the outcomes of those investigations, and strategies that could be used to combat Medicare fraud. This statement is informed primarily by our September 2012 report on health care fraud and 8 years of prior work on fraud, waste, and abuse in health care programs.

For information, contact Kathleen M. King at (202) 512-7114 or kingk@gao.gov.

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