HHS Could Boost Fraud Reward to Nearly $10 Million

Secretary Sebelius launches proposed rule to substantially boost reward payout for reporting acts of Medicare fraud.

Health and Human Services Secretary Kathleen Sebelius has unveiled a proposed rule that would increase the pay-outs for rewards paid to Medicare fraud reporters to as high as $9.9 million. The rewards would be paid to those who report tips about suspected fraud that lead to the successful recovery of funds.

“President Obama has made the elimination of fraud, waste and abuse, particularly in health care, a top priority for the administration,” said Secretary Sebelius in a public statement.  “Today’s announcement is a signal to Medicare beneficiaries and caregivers, who are on the frontlines of this fight, that they are critical partners in helping protect taxpayer dollars.” 

The announcement marks a massive ratcheting up in rewards for fraud reporters. Under HHS’s current incentive program, the agency currently offers a reward of 10 percent up to $1,000. Under the proposed changes, a person that provides specific information leading to the recovery of funds may be eligible to receive a reward of 15 percent of the amount recovered, up to nearly $9.9 million. 

CMS modeled the changes are modeled on an IRS program that has returned $2 billion in fraud since 2003. CMS chalked up some of the $14.9 billion in Medicare fraud it has recovered over the past three years to reporting by individuals, but did not specify how much.

The proposed rule would also strengthen certain provider enrollment provisions including allowing HHS to deny enrollment of providers who are affiliated with an entity that has unpaid Medicare debt, deny or revoke billing privileges for individuals with felony convictions, and revoke privileges for providers and suppliers who are abusing their billing privileges.

About the Author

David Kopf is the Publisher and Executive Editor of HME Business and DME Pharmacy magazines. Follow him on Twitter at @postacutenews.

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