FLOOR STATEMENT: Fighting Medicare Fraud

Friday, 11 February 2011 00:00

For The Congressional Record
Febuary 10, 1011

Mr. Speaker:

I rise with my colleague Ways and Means Health Subcommittee Chairman Wally Herger (R-CA) to re-introduce the Strengthening Medicare Anti-Fraud Measures Act. 

This bipartisan legislation is a direct byproduct of a joint hearing held by the Ways and Means Health and Oversight Subcommittees last year.  The hearing was on efforts to reduce fraud, waste and abuse in Medicare.

We heard testimony at that hearing from two panels of witnesses.  The first panel consisted of Members of Congress pursuing legislative initiatives to reduce Medicare fraud, waste and abuse.  The second panel was made up of government witnesses:  Office of the Inspector General of the Department of Health and Human Services (OIG), The Centers for Medicare and Medicaid Services, and the Government Accountability Office. 

Numerous witnesses raised concerns about limitations to the authority of the Office of the Inspector General to minimize Medicare fraud.  From this discussion it became clear to Rep. Herger and myself that we should change the law to provide the Inspector General with the additional tools requested to better protect Medicare.

This is a simple bill with only two provisions.  It expands the OIG’s permissive authority to ban executives whose companies have been convicted of Medicare fraud from the program.  Second, it expands the OIG’s permissive authority to exclude affiliates of corporations convicted of fraud, including parent companies hiding behind convicted corporate shells.

The first change is important because it will enable the OIG to protect Medicare from executives who circumvent exclusion by moving to another company.  Under current law, executives whose companies are convicted of fraud can be excluded from Medicare.  However, if the executive has left the company by the time of conviction, he or she cannot be barred from Federal health care programs.  These executives are able to move from one company to another and continue to defraud Medicare, seniors, and taxpayers.

The second change provides the OIG with stronger tools to address corporations that have engaged in fraud.  Companies that engage in fraud often set up shell companies to insulate themselves from liability.  Criminal settlement negotiations can result in the conviction of these shell organizations with no real operational impact on the parent company.  Without discretionary authority to exclude parent companies from the program, the OIG is missing a tool in its arsenal that could allow the government to exclude particularly bad actors or obtain stronger prospective remedies in settlements.

This legislation passed the House of Representatives last year by voice vote.  Unfortunately, it was not taken up in the Senate.  We urge our colleagues to cosponsor this bill so we can quickly enact these new anti-fraud tools to protect Medicare beneficiaries and all of America’s taxpayers.