Medicaid fraud and abuse in Florida: a new approach to an old problem.

• Author: Dudek, Elizabeth

Health care fraud and abuse is suddenly a high profile issue. Thanks to Congress' recent attention, the public is waking up to the fact that fraudulent and abusive activities on the part of health care providers cost public insurance programs billions of dollars every year. This is old news at the Agency for Health Care Administration (AHCA).

AHCA administers Florida's Medicaid program, and is a $6.5 billion program that covered more than 1.5 million people in 1997. Estimates are that up to 10 percent of public health care expenditures are related to fraud and abuse. But not anymore -- not in the Florida Medicaid program, at any rate. AHCA's programs not only promise to loosen the grip that fraud has had on Medicaid's budget but also already are producing groundbreaking results.

Health Care Fraud and Abuse: A Definition

What is fraud and abuse? Simply put, fraud and abuse means paying people who shouldn't have been paid or paying people more than they deserve. For the purposes of Medicaid, F.S. [sections] 409.913 defines fraud and abuse follows:

Fraud: An intentional deception or misrepresentation made by a person with the knowledge that the deception results in unauthorized benefit to himself or another person. The term includes any act that constitutes fraud under applicable federal or state law.

Abuse: 1. Provider practices that are inconsistent with generally accepted business or medical practices and that result in an unnecessary cost to the Medicaid program or in reimbursement for goods or services that are not medically necessary or that fail to meet professionally recognized standards for health care. 2. Recipient practices that result in unnecessary cost to the Medicaid program.

How Fraud Impacts the Entire Economy

Discussions of fraud and abuse in the Medicaid program do not capture most people's attention. This usually is because people are not interested in things that do not involve them or their pocketbook; however, the public should be aware that Medicaid fraud and abuse affects both. Fraud and abuse are the "stealth tax" of the health care system.

To a certain extent, the lack of public concern is due to a lack of effective communication on the issue. Many of the ways fraud and abuse impact John Q. Citizen are straightforward. Fraud and abuse make the Medicaid program more expensive than it should be. This means higher taxes. Most people can understand this type of social calculus. The more esoteric effects of fraud and abuse are elusive and more difficult for the public to understand. Ironically, these effects undoubtedly have the most direct impact upon individual citizens.

For example: A traditional response to rising costs in the Medicaid program has been for lawmakers to cut the size of the program by limiting the number of people covered. This is considered politically expedient because the people being cut don't often vote and the people who do vote believe Medicaid reductions don't involve them directly. Such thinking fails to consider the fact that the indigent will continue to require medical care. If Medicaid is increasingly unavailable, as a consequence of cost-cutting policies, the indigent will seek care in settings which often are partially funded through local property taxes. Fewer Medicaid beneficiaries means more medically indigent, and in many areas of the state, that means upward pressure on local taxes.

But that's not the end of it, because the largest hit to the average citizen's pocketbook...