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Massachusetts Faces Record Health Care Fraud

Massachusetts State Auditors identified $9.5 million in welfare fraud in fiscal year 2014, the highest amount in years. While Medicare and Medicaid fraud are a nationwide phenomenon, the increase in identified fraud could be the result of a higher rate of fraud, or simply better detection and investigation. 

Suzanne Bump, the Massachusetts State Auditor, released a report identifying the millions in welfare fraud. The highest percentage of came from MassHealth fraud, the state's Medicaid program. The fraud noted in the report reflects 824 cases of fraud, of which 150 were MassHealth cases. According to Christopher Thompson, a spokesman for the auditor's office, MassHealth cases involve higher amounts of money because of the high costs of health care and benefits.

Last month, twin sisters were charged with medical fraud, stealing more than $580,000 from state and federal agencies posing as psychologists. The sisters allegedly used the names of other psychologists and counselors when they billed the government for conducting psychological exams, when neither was a licensed psychologist.

The investigation began after after a licensed psychologist informed the Attorney General's office that someone was using the psychologist's name and license number. The sisters are facing allegations of medicaid fraud, larceny, identity fraud, and the unlicensed practice of psychology.

Earlier this year, the former director of a Waltham-based home health care agency plead guilty for defrauding Medicare over $27 million. From 2011 to 2012, the home health agency signed certifications to provide services to hundreds of Medicare beneficiaries who were not qualified for home health services. In fact, many of these patients had not requested home health services and many were not even provided with nursing services. The owners of the company also plead guilty to healthcare fraud and money laundering.

Of the fraud identified in 2014, the state has only collected $1.4 million. Some individuals have been unable to pay the state the defrauded money. According to Thompson, there is also a delay between identifying and collecting the money, and other people are paying in installments.

Suzanne Bump has said that the higher amount of welfare fraud does not necessarily correlate with an actual increase in fraud, but rather their office has taken an, "increasingly vigorous approach" to investigating fraud. According to Thompson, the number of investigators in the auditor's office has not changed since 2011, but thanks to a new "fast-track" process, the investigators are processing more cases.

The State Auditor's have cited direct access to MassHealth databases in order to initiate investigations, with real-time results. Based on this enhanced access, Bump has stated that her office wants the same access to records at the Department of Transitional Assistance. The DTA has come under fire after the Auditor's detected fraudulent benefits to almost 1,200 people last year.

In other states, some Medicaid anti-fraud programs have faced harsh criticism for their lack of investigative prowess. According to the Houston Chronicle, the Texas Health and Human Services Commission's Office of Inspector General will face a special review after an audit found virtually no prevention efforts, a more than three year backlog, and collection of only a fraction of the detected health care fraud.

A copy of the Office of the State Auditor's full report can be found here.

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