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Bill would double Medicare fraud penalties

MIAMI — Medicare fraud suspects would face longer prison sentences under a U.S. House bill proposed Tuesday that also advocates biotechnology such as fingerprint scanning to ensure patients are getting the goods the government is billed for.

Authorities have warned Medicare fraud, an estimated $60 billion annual crime, is now more lucrative than dealing drugs. Until now the penalties have been far less severe.

For example, a Medicare scammer could easily net at least $25,000 a day while risking 5-10 years in prison if convicted on a single count. A cocaine dealer could take weeks to make that amount while risking up to life in prison.

The bill is sponsored by U.S. Representatives Ileana Ros-Lehtinen, R-Fla., and U.S. Rep. Ron Klein, D-Fla., both from South Florida, which has long been ground zero for the fraud. Miami-Dade County alone generates more than $3 billion a year.

The Medicare Fraud Enforcement and Prevention Act will double prison sentences from 5 to 10 years and fines from $25,000 to $50,000 for Medicare fraud-related crimes.

The bill would also create a new crime for illegally distributing patients’ Medicare or Medicaid IDs or billing information, which would carry a maximum 3-year sentence.

After years of serving in Florida’s state legislature, Klein says he repeatedly hears frustrations about Medicare fraud from his senior constituents.

“They don’t want to hear that billions of dollars are coming out of a system that they depend on and going to fraud and criminal activity,” he said.

The bipartisan proposal also seemed like a natural follow up to the recent health care bill, Klein said.

Medicare fraud has been a focus of the health care debate with the Obama administration promising to help pay for the health care overhaul by cutting down on the abuse. Outlandish scams, such as billing Medicare for dead patients or charging prosthetic limbs to patients with all four limbs, have also caused public outrage. In December, a Florida doctor was charged with running a $40 million home health care scheme that falsely listed patients as blind diabetics so that he could bill for costly, twice-daily nurse visits.

The criminal opportunity has created a sophisticated network including doctors, nurses, patient recruiters and patients. Organized crime rings have also dipped into the pot in recent years, authorities said.

“The government cannot incarcerate its way out of Medicare fraud, prevention is the answer,” said attorney Kirk Ogrosky, former head of the U.S. Department of Justice’s criminal health care practice.

Experts have long criticized the program for loose restrictions that make it easy for crooks to obtain a Medicare supplier license.

Klein says the bill would target high risk suppliers, requiring criminal background checks, fingerprinting and random site visits to make sure the claims are legitimate. Under the current Medicare system, suppliers are automatically paid within 30 days, making it easier for fly-by-night storefronts to flourish.

A 5-year pilot program by the Department of Health and Human Services that would use biometric technology to ensure that patients are physically present to receive certain services is also proposed in the bill.