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Powered Wheelchair Medicare Fraud

Monday August 18th, 2014   •   Posted by Craig Eyermann at 6:06am PDT   •  

10341566_S The single most expensive item for which the Medicare welfare program will pay claims is a power wheelchair. In 2008, Medicare “paid” for 158,185 power wheelchairs at a cost of over $490.4 million, or an average cost of $3,100.37 per power wheelchair. By contrast, the second most expensive medical line item that Medicare will pay toward is for a total knee arthroplasty, which costs $1,207 per procedure.

According to news broken by the Washington Post this past weekend, the people who run the Department of Health and Human Services and the Medicare program have absolutely no idea how many of the claims filed for power wheelchairs that they pay each year are completely bogus.

The wheelchair scam was designed to exploit blind spots in Medicare, which often pays insurance claims without checking them first. Criminals disguised themselves as medical-supply companies. They ginned up bogus bills, saying they’d provided expensive wheelchairs to Medicare patients — who, in reality, didn’t need wheelchairs at all. Then the scammers asked Medicare to pay them back, so they could pocket the huge markup that the government paid on each chair.

A lot of the time, Medicare was fooled. The government paid.

Since 1999, Medicare has spent $8.2 billion to procure power wheelchairs and “scooters” for 2.7 million people. Today, the government cannot even guess at how much of that money was paid out to scammers.

Now, the golden age of the wheelchair scam is probably over.

But, while it lasted, the scam illuminated a critical failure point in the federal bureaucracy: Medicare’s weak defenses against fraud. The government knew how the wheelchair scheme worked in 1998. But it wasn’t until 15 years later that officials finally did enough to significantly curb the practice.

As part of its reporting, the Washington Post provides a helpful video describing how to scam Medicare in four easy steps.

While the scam’s easy days seem to be over, Medicare’s administrators and bureaucrats still aren’t able to quantify how much fraud it tolerated during the 15 years they knew they had the problem:

When officials review old wheelchair bills, they discover that at least 80 percent of them were “improper”: They contain major errors and shouldn’t have been paid as is. Perhaps the patient’s diagnosis didn’t actually qualify for a power wheelchair. Perhaps the paperwork was incomplete.

How many of those bills were sent in by fraudsters, trying to squeeze through the system’s blind spots?

Medicare can’t say.

“You’d have to talk to the patient. You’d have to talk to the providers” and ask if the wheelchair was really needed, said Shantanu Agarwal, a doctor who is Medicare’s top fraud fighter. “And then, at the end of it, you could make a reasonable, fact-based, experienced-based determination about whether this is probably fraud,” Agarwal said. Medicare doesn’t have the time or money to do that for power wheelchairs now.

Why doesn’t Medicare take the time to prevent such fraud? Because, in the bureaucratic mind, doing that kind of work is more costly and demanding of government employees than is just sitting back and enabling the fraud. Because that’s Uncle Sam’s money. If he runs low, he can just go borrow more.

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August 2014