Tag Archives: medicare

Owner of Miami Clinic Gets 22 Years for Medicare Fraud

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As an update to yesterdays post, Michael De Jesus Huarte, who ran a clinic that committed Medicare Fraud in Miami, as well as several other southern states, including North Carolina, South Carolina, Louisiana, and Georgia, has been sentenced to 22 years in prison.

Huarte pleaded guilty to Medicare Fraud and Money Laundering, as well as several other charges last year, which stemmed from over $100 Million in fraudulent claims. Many of these claims were associated with HIV treatment. Huarte was sentenced yesterday, Wednesday January 27 2009, to 22 years in prison. In total, six people were indicted with Huarte, who were found to be complicit in Medicare Fraud. However, three of these defendants have been reported to have fled Miami or at least did not show up for their sentencing.

Medicare Fraud is very common and often involves filing false claims for durable medical equipment, although as is the case with Huarte, many also bill Medicare for procedures that are not preformed. Medicare, which is a state run insurance program mainly aimed at providing affordable health care to those over 65, has a long history of problems with fraudulent claims, so it is common for the courts to hand out very strict sentences in an effort to make an example of those who are caught.

Medicare Fraud Report

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Medicare, which is Federally Run Insurance/Heath Care System, is one of the most controversial departments of the US Government. It is often ripe with fraud and many in the Health Care Industry feel that Medicare and Medicaid do not pay enough to cover the costs of their service. However, many others, including many of those who are on Medicare, feel that it offers a quality of service that would be unaffordable for many seniors.

Medicare Fraud is actually one of the biggest downsides of Medicare and is something that is constantly occurring. For example, just in the last day, there are about 1000 newspapers articles in the Google News Database that are about Medicare Fraud. Of course, many of these are likely about similar cases, but it serves to illustrate how prevalent this problem is in Medicare.

Medicare Fraud Watch

In Miami, the owner of a Medicare Clinic is facing prison time and will be sentenced today, after submitting $100 million of fraudulent HIV claims and $30 Million in Fraudulent Medicare Claims. This occurred not only in Florida, but also North Carolina, Georgia, South Carolina, and Louisiana. Michel De Jesus Huarte, the owner of the clinic, faces up to 20 years in prison, while six others are also facing prison time.

In California, the owners of a Medical Center that found homeless people and preformed unneeded services on them has been ordered to pay $10 Million. The owners paid people who worked at homeless shelters to act as recruiters, finding homeless people that were on Medicare or Medicaid and paying using them, albeit as employees, in defrauding the government.

In Houston Texas, several individuals who own a durable medical equipment company were just sentenced to repay $36 Million in fines, after they used their position in the home medical equipment industry to bill Medicare for different types of durable medical equipment, like adjustable beds and mobility scooters, which was never actually given to the patient.

Common Types of Medicare Fraud

There are a lot of different types of Medicare Fraud, but more often than not, it is the suppliers of durable medical equipment who are found to be committing these crimes.

Medicare Part B Benefits include the coverage of durable medical equipment, which includes a wide variety of home medical equipment, such as wheelchairs, scooters, and adjustable beds. It also covers glasses, prostheses, and oxygen equipment. In most cases, providing the patient is covered by Medicare and has a prescription for the equipment, Medicare will cover 80% of the cost. There are exceptions to this rule though, such as Medicare Lift Chairs, which are not completely covered. However, for the most part, as long as there is a medical need for the item, Medicare will provide 80% reimbursement for it.

Unfortunately, the home medical equipment industry has always been ripe with fraud, not just with Medicare. This is in part because medical equipment suppliers are not necessarily run by health care professionals or doctors. Instead, they are usually business people who are out to make a profit, which of course leads to abuse. Also, it is much easier to fraudulently sell Medical Equipment than it is to bill for services that are not preformed, so Durable Medical Equipment fraud remains one of the most common types of Medicare Fraud.

Of course, as the examples above illustrate, there are many other types of Medicare Fraud and fraudulent billing is also very common.

The prevalence of this type of dishonest medical billing is one factor that many are using to argue against a state run health care program. However, to be fair, Insurance Fraud occurs all the time in all private insurance as well. However, since most private insurance companies are in the business of denying claims, rather than approving them, Medicare makes an easier target.

Pork in the Health Care Reform Bill and Medicare

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With the passage of the new senate health care reform bill and its move from a private committee to the public light, now gives analysts some time to see what is in the bill and what pork was added to buy the votes it needed to pass. In terms of Medicare, many people are also concerned that even though there are higher tax rates for Medicare, there will also be cuts to service.

It looks like doctors and hospitals in a number of states will be getting paid more, as senators traded their vote on the health care reform issue in return for pork for their state.

Pork Report: Medicare and Medicaid Bribes

In return for the votes of the Senators from North Dakota, Byron Dorgan and Kent Conrad, an amendment was added to the bill, which requires higher payments from Medicare to hospitals in their state. This amendment, dubbed the Frontier Amendment, will funnel $650 million more into the hands of doctors and hospitals in North Dakota over the next 10 years.

In return for the votes of the senators from Hawaii and Michigan, doctors will also earn more for their Medicare Payments, while also reducing costs for Blue Cross and Blue Shield, a major insurance company, in Michigan.

The votes from Vermont and Massachusetts senators were also similarly won, with larger payments going towards Medicaid. Vermont is expected to take in a $250 million windfall.

There is also an Amendment that will funnel $100 million dollars into one of several prospective states, in order to build a new hospital/research center. While the winner of this bride is not known yet, it was promoted by Senator Dodd, in the hopes of funneling it into his home state of Connecticut.

In what is now being called the “New Louisiana Purchase,” senator Mary Landrieu in Louisiana was paid off with a $300 million expansion to Medicaid Funding.

While there is still much to review, it is clear that the Pork was effective, securing the necessary votes to pass what is being referred to as health care reform. Despite these big payouts to increase payments to doctors and hospitals, there are still a number of cuts to Medicare Funding, including some reductions in how Medicare Advantage Plans will be paid.

While there are certainly a number of good points to the Health Care Reform Bill passed by the Senate, it ultimately ends up forcing people to buy into private insurance companies, while providing few mechanisms to actually ensure that the private insurance companies do not simply raise their premiums.

All of the good in this bill could have been made without funneling money into the corporations, who indecently spent around $700 million bribing our political leaders for the last two years. However, they do not work for us, so we will get reform in the sense of raising bonuses for the health insurance CEO’s.

Medicare Part B Benefits

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Part B Medicare Benefits cover a variety of procedures that are not covered under Part A Benefits. Like other Medicare Benefits, those who are working are able to put off enrolling for Part B Benefits, which are optional, however those who are not working and do not enroll will face a 10% increase in premiums each year.

To Enroll in Medicare, including Part B Benefits, you can visit their site here.

While Part C is used to cover prescription medicine, Part B will cover medication that is given by a doctor. It also covers some doctors visits, x-rays, blood tests, chemotherapy, ambulance transportation, and a number of other outpatient treatments, such as vaccination for the flu.


Durable Medical Equipment

One of the most important parts of Part B Benefits, however, is the coverage of Durable Medical Equipment. Durable Medical Equipment refers to a number of different types of home medical equipment, such as hospital beds and wheelchairs, as well as things like eye glasses, oxygen equipment, and prosthetics.

In most cases, Medicare will cover 80% of the cost of the equipment, with the insured being responsible for the remaining 20%. It is almost always necessary to have a doctors prescription and certain types of equipment will also require a Certificate of Medical Necessity, which is simply a much more detailed prescription that outlines the specific conditions the patient has. Certain equipment will have some extra requirements that the patient must meet, such as someone who wants to have their mobility scooter covered would need to use it all of the time, both at home and away, and not merely when away from home.

While the majority of medical equipment covered under Part B Benefits is covered up to 80%, this is not the case with all types. Lift Chairs, which are basically recliners that act as a standing aid, are one example, as they are only partially covered. They also require a Certificate of Medical Necessity, which among other things, requires that the patient can not stand from any chair in their home. Usually Medicare will be reimbursed for about $300, which covers the cost of the lifting mechanism, but the entire chair is not covered. Getting reimbursement is not always easy either.

Other items, specifically those that involve home modification are not usually covered under Medicare Part B. For example, widening the doorways for a wheelchair user or installing an elevator would not be covered.

Cost of Part B Benefits

A monthly premium is required for those wishing to use Part B Benefits, which is usually around $100. However, since 2007, the premium is also based off of income and whether the insured is married, with a higher income meaning a higher premium and can be as high as $300.

In addition to a monthly premium, the patient must also pay a yearly deductible if they use these benefits, which was around $130 in 2009. There is also a copay required for most items, which is usually 20% of the cost of the item, with Medicare paying the other 80%. However, as stated above, some items, like lift chairs Medicare, are only partially covered under Medicare. However, blood work and other laboratory services are often covered completely. A 15% surcharge is added if the physician is not certified by Medicare.

Medicare Part C Benefits: Medicare Advantage Plans

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Medicare is a socialized insurance program that is funded by the Federal Government and was first established during the 1960’s. Originally, Medicare included two Parts, Part A and Part B, and was both funded and administered over solely by the Government. However, beginning in 1997, a new part of Medicare was added that allowed those on Medicare to opt to use a private insurance plan, instead of the traditional federally run plans. These plans are called Medicare Advantage Plans and are under Part C of Medicare Benefits.

What Are Medicare Advantage Plans?

The idea behind Medicare Advantage Plans is that the actual plan itself is run by private insurance companies. The plans are still funded by the Federal Government, but are actually administered over by the private health industry. Medicare Advantage(MA) Plans, were added onto Medicare as part of the Balanced Budget Act of 1997 and in 2003, Prescription Drug Coverage was added as part of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003.

Like traditional Medicare Plans, such as Part A Benefits, the insured usually has to pay a premium when using an MA plan. MA plans are also required to cover anything that regular Medicare would, but are given a good deal of leeway in how they implement their insurance program. So, for example, an MMA plan is required to help cover the cost of a doctors visit, but they may require a higher co-pay than traditional Medicare.

Many Medicare Advantage Plans will also cover some things that traditional Medicare does not, in an effort for the Private Insurance Companies to get people to use their programs.

Dangers of Using Medicare Advantage Plans

Since the private insurance companies run MA plans and are allowed to make some changes to what they charge or how they cover certain things, it is important to be very careful when choosing a plan. It is important to compare the benefits and costs of the plans to traditional Medicare, taking into account the needs of the insured. It is also important to compare the different Medicare Advantage Plans available, as they can differ too.

Again, because MA Plans are run by Private Insurance instead of the Government, many patients find that they have difficulty getting items covered and must fight the insurance companies, who are, after-all, out to make a profit. Each year, a great deal of those who signed up for MA plans, wooed by the extra perks, like dental coverage, decide to switch to the Federally run programs, with about a third of these people citing problems getting coverage through the private insurance companies.

Cost to the Taxpayers

In addition to many finding that the for-profit Medicare Advantage Plans do not provide adequate coverage and making claims is often met with resistance from the private insurance industry, these plans are also much more expensive to the taxpayers.

On average during 2005, these plans cost the taxpayers about 12.5% more than traditional Medicare, with the private insurance companies usually earning at least 6% profit.

When you take into account the fact that so many people are dissatisfied with MA plans and the added cost to tax payers, it makes it very hard to support allowing Private Insurance to become involved with Medicare. However, as can be seen from the current health care debate, Private Insurance Lobbyists have a very deep hold on the Senate and the President.