Kelli Kennedy, the Associated Press' top reporter on issues of health care fraud and abuse, released an article on October 16, 2011 titled "Medicare yanks licenses, gives them right back." The article-- which was printed in major newspapers including the Wall Street Journal and Chicago Tribune-- exposed glaring problems and loopholes in the nation's $520 billion Medicare program. The article explains that private contrators now have substantial responsibility for safeguarding the Medicare Trust Fund, and are paid millions annually to process Medicare claims, screen Medicare providers, and combat fraud. Due in part to poor coordination between these government contractors, Medicare fraud is estimated at $60 to $90 billion annually, and remains rampant in hot spots including South Florida, Los Angeles, Baton Rouge, La., Houston, Brooklyn, N.Y., and Detroit .
Kennedy explains the problem as follows:
Medicare hires Contractor A, which is in charge of fraud detection, to inspect a medical equipment company. Under the law, providers are required to have an office that is open and staffed during regular working hours — but some have empty storefronts and some have only a post office box.
Contractor A recommends revoking the company's Medicare license to Contractor B. But Contractor B ultimately decides whether to revoke and often does not have the same information that Contractor A has.
Kennedy called upon Stumphauzer & Sloman partner Ryan Stumphauzer, the former Deputy Chief of Health Care Fraud at the Miami U.S. Attorny's office, to explain the problem:
Sometimes one subcontractor without firsthand knowledge of the case or the necessary medical expertise will overturn a suspension made by the contractor that had direct evidence of fraud, said Ryan Stumphauzer, a former Miami federal prosecutor who specializes in health care fraud.
So the company appeals, and an independent third party known as a hearing officer decides whether to reinstate the license. If the provider disagrees with that decision, the appeal can be kicked up to an administrative law judge.
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"Nobody from (the government) bothers to attend the appeal hearing, so the judge hears a one-sided story and the government is virtually guaranteed to lose," Stumphauzer said. "Every taxpayer should be outraged."
Ryan Stumphauzer is available to counsel business entities and individuals on health care fraud and abuse issues. Whether it is defending a client against a government enforement action, assisting a whistlelower in reporting ongoing fraud, or helping clients navigate onerous contractor audits, Ryan Stumphauzer has the skills to help.