The Untold Obama Administration Success Story

One wonders what the Obama administration has to do to get a little credit. I’m sitting on vacation, looking at the ocean most of the day, and spending about a half hour on line at night erasing unread emails, killing out unread RSS feeds, and checking up on my declining retirement prospects. Amid the clutter, a series of press releases from the Inspector General of the Health and Human Services Department caught my eye. Here are the headlines, with links (I’d link to the press coverage, but near as I can tell, there was none):

That was Tuesday. On Monday, the HHS sleuths put out this press release:

PHILADELPHIA – A federal jury today convicted Dr. Joseph J. Kubacki, 62, of Destin, Florida, of 150 counts of health care fraud, wire fraud, and making false statements in health care matters, announced United States Attorney Zane David Memeger. Kubacki was the Chairperson of the Ophthalmology Department of the Temple University School of Medicine and also served as the Assistant Dean for Medical Affairs when, between 2002 and 2007, he caused thousands of false claims to be submitted to health care benefit programs with false charges totaling more than $4.5 million for services rendered to patients whom Kubacki did not personally see or evaluate. A sentencing hearing has not yet been scheduled.

Last month, the actuaries at the Centers for Medicare and Medicaid Services reported that costs grew by only 3.9 percent last year (not adjusted for inflation), the slowest rate of growth since the inception of the program. Health care as a share of the economy did not grow for the first time in years. In other words, health care costs last year were essentially “under control.” Think there’s any connection between slowing health care cost growth and fraud? Here’s a sentence from the final paragraph of the latest press release from the OIG. The “strike force” refers to the special unit set up in CMS to search out fraud, which has gotten a huge boost in funding and support during Obama’s first three years in office:

Since their inception in March 2007, Strike Force operations in nine locations have charged more than 1,000 individuals who collectively have falsely billed the Medicare program for more than $2.3 billion.

A billion here, a billion there. After a while we’re talking real money. It’s not that every doctor, hospital, clinic, or durable equipment supplier is a fraudster. But by cracking down on those who are, the rank-and-file Medicare practitioner begins to think twice about over-prescribing Medicare services for his or her patients.

Merrill Goozner has been writing about economics and health care for many years. The former chief economics correspondent for the Chicago Tribune, Merrill has written for a long list of publications including the New York Times, The American Prospect, The Washington Post and Financial Times. You can read more pieces by him at GoozNews, where this post first appeared.

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14 replies »

  1. Hi there, You have done an excellent job.
    I’ll certainly digg it and personally suggest to my friends.
    I’m sure they’ll be benefited from this website.

  2. I always astounds me that it takes so long and the losses are so great before fraud is detected. Surely CMS computers could keep tract of cost per patient per unit time by every provider number and find the outliers much faster. For just a start anyone billing over $25 million a year or $2 million a month might be worth looking at more closely. I am still very troubled that as a provider I do not get a statement as to what I am costing and particulary in the phenomenal growth area of home health services. I have no idea of what I am signing for other than help for an elderly or disabled person who does not have adequate family support. How can I be accountable without any account to evaluate?

  3. “Think there’s any connection between slowing health care cost growth and fraud?”

    This is pretty shoddy work. The right answer, of course, is : maybe, maybe not — nobody has any idea.

    Think the unemployment rate has anything to do with any Obama policy whatever? Of course not, it’s Bush’s fault.

    The mark of a political activist is that correlation is causation when they say it is. The mark of a journalist is that correlation is never causation, until proven. A “health care journalist”, on the third hand, is a political activist who has a tactical need for a different label.

  4. I was asking Merrill about this posting on his blog. Is this another case of like Father, like Son? Joe Kubacki is a son of our late Reading, Pennsylvania Mayor John C. Kuback, who was indicted on extortion charges by a federal grand jury in 1964, the last year of his first term, according to Reading Newspaper accounts.

    John Kuback was convicted along with reputed Reading mobster Abe Minker of extorting $10,000 from parking meter vendors who were told they should pay up or lose their city contracts. Is this kind of criminal activity in the genes or the epigenes?

    The paper said that in the closing arguments at trial, prosecutors argued that Kubacki had a serious alcohol problem and was drinking on the job. Boy! That make me feel even better. Well, he can take alchohol rehab with serving his eight years in prison.

    With a base salary of $210,000, a chair stipend of about $90,000 and a bonus of about $60,000, he thought “greed” would be more lucrative?

  5. I’m glad someone wrote about this. I have noticed an uptick in fraud prosecutions for over a year and wondered if they were having an effect on behavior. Of course, post hoc ergo propter hoc is a fallacy, so more evidence is needed to say that the prosecutions are causing the slowed growth.

  6. I had heard that the government was going to concentrate on a few areas of the country regarding medicare fraud. These were (are) areas with much higher than the median cost per medicare beneficiary. Hence the south Florida focus. I heard Chicago and parts of Texas were a focus as well. AT least in my area we are below median.

  7. Just a tip, most people who engage in Medicare fraud are not physicians, or use them as a front while the real crooks stay behind the scenes. Sorry to disappoint the mob, but most doctors aren’t antisocial. Or sociopaths.

    Again, a couple of fraudulent physicians are the generalized example of doctors run amok in fleecing the system. Anything to try to give PPACA traction for the defenders and apologists. And that is my flay.

  8. There should be no federal system that does not monitor how its money is spent. While I think that lot of the waste, fraud and abuse exists only by how you define it (usually done for political purposes) there is a lot that could be rooted out with some effort. Most of us in the trade are aware that it is concentrated in some areas. One would hope that they could catch a lot just by utilization patterns.


  9. “One wonders what the Obama administration has to do to get a little credit.” Is that a joke? He can ask either Warren Buffett or the Chinese. They still give Obama credit….for now.

    Thanks for the intro, Bobby.

  10. Why are we lied to? Example you can elect to change plans once each year without regard to health concerns. Well that may be true for Medicare subsidised plans but you cannot with medicare supplement plans.
    They set that up so politions could lie with a straight face.

  11. It is obvious for me that Obama Administration did some good things too.
    Even if little change in the end, the fact that the system was shaken around a bit at least dusted it off and removed some spider’s nests. That’s what happened in the success story described here.

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