Medicare from 2000 to 2007 paid between $60 million and $92 million to medical suppliers that used the identification numbers of dead physicians to file fraudulent claims, according to a report presented on Tuesday by the Senate Homeland Security and Governmental Affairs Investigations Subcommittee, the Washington Post reports (Lee, Washington Post, 7/9).

For the report, subcommittee investigators examined a random sample of 1,500 physicians who died between 1992 and 2002 and found that 734 of their Medicare identification numbers appeared on claims filed from 2000 to 2007 (Diaz, Minneapolis Star Tribune, 7/9). Those ID numbers were used for 21,458 claims totally $3.4 million, and investigators extrapolated from these amounts to estimate a total number of fraudulent claims (Washington Post, 7/9).

Medicare paid an estimated "478,500 claims containing identification numbers that were assigned to deceased physicians" during that period, and those claims "contained identification numbers for an estimated 16,548 to 18,240 deceased physicians," the report found (Pear, New York Times, 7/9). Active identification numbers for as many as 2,895 dead physicians remain in the Medicare database, according to the report (Washington Post, 7/9).

According to a report released in 2001 by the HHS Office of Inspector General, Medicare in 1999 paid $91 million in claims that used the identification numbers of physicians who no longer participated in the program. In response, CMS required a one-time elimination of the identification numbers of dead physicians from the Medicare database and ordered contractors to reject claims that used inactive or invalid identification numbers.

However, the subcommittee report found that those measures did not address the issue. "The fact is that, seven years after the problem was first identified, the claims-review process is still not working properly to reject claims containing the provider numbers of deceased physicians." The report recommended that CMS eliminate the identification numbers of dead physicians from the Medicare database "on a timely and efficient basis" (Zhang, Wall Street Journal, 7/9).

Comments
Subcommittee ranking member Norm Coleman (R-Minn.) said, "Scam artists have treated Medicare like an automated teller machine, drawing money out of the government's account with little fear of getting caught," adding, "When Medicare is paying claims and the doctor has been dead for 10 or 15 years, you know there is a serious problem" (New York Times, 7/9). Subcommittee Chair Carl Levin (D-Mich.) said, "The slipshod procedures that let these claims get through are an insult to U.S. taxpayers. It is long overdue to shut the door on this multimillion-dollar abuse" (Appleby, USA Today, 7/9).

CMS spokesperson Jeff Nelligan said, "Fraud and abuse in the context of Medicare-covered durable medical equipment has been a focal point of ours in recent years." He added that a new Medicare competitive bidding program for medical equipment suppliers that took effect July 1 requires suppliers to "be fully accredited based on strict financial and quality standards" (Washington Post, 7/9).

In a June 24 letter to Coleman and Levin, CMS Deputy Administrator Herb Kuhn said that the agency "shares your concerns" and has taken steps to address the issues raised in the report. "We believe the initiatives we have initiated will address many -- if not all -- of the issues," he wrote (Minneapolis Star Tribune, 7/9).

ABC's "World News" on Tuesday included coverage of the fraud (Stark, "World News," ABC, 7/8).

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