Disturbing New Statistics Show Huge Percentage Of Financial Fraud Against U.S. Government Comes From Healthcare Industry

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Don Soeken

Dr. Donald Soeken is a social worker with 40 years of professional experience in the multidisciplinary areas of practice, research, and teaching

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June 10th, 2011 8:22 PM

Disturbing New Statistics Show Huge Percentage Of Financial Fraud Against U.S. Government Comes From Healthcare Industry

By Don Soeken

Ever wondered who the biggest culprits are, when it comes to defrauding the taxpayers of the United States?

The answer to that question may surprise you.

According to some shocking new statistics from the nonprofit Taxpayers Against Fraud (TAF) public interest group, the ranks of the admitted federal cheaters are occupied almost entirely by health insurers and the healthcare pharmaceutical industry.

That’s the clear and thoroughly disturbing conclusion to be found in a revealing TAF study of the “Top 20” fraud lawsuits (ranked by dollar amounts) to have been decided by court judgments or agreed-upon settlements in recent years. Amazingly, the list of penalty awards – as adjudicated under legal procedures mandated by the U.S. False Claims Act – contains no fewer than 19 healthcare or health insurance entities . . . and only a single financial entity who isn’t engaged in the business of health insurance or medical care.

Astonishing? You bet it is. Even a quick look at the list of recent fraud convictions and fraud case settlements involving the U.S. healthcare industry (to review them for yourself: www.taf.org) should be enough to make any alert taxpayer ask: Why haven’t all of these obvious fiscal abuses by healthinsurers and the pharmaceutical industry been reported in the news media . . . even as the entire nation continues to debate the future of healthcare reform?

As the Taxpayers Against Fraud website makes chillingly clear, some of America’s most best known and most trusted healthcare industry corporations are heading up the list of despicable cheaters whose conscienceless manipulation of federal health dollars has resulted in convictions or financial settlements with Uncle Sam.

Some appalling examples from the TAF “Top 20”: list:

No. 1 Fraud Offender: Pfizer -- $1 billion under the False Claims Act. Pfizer paid a total of $2.3 billion, of which $1.3 billion was a criminal fine for kickbacks and off-label marketing and $1 billion was paid under the False Claims Act.

No. 2 Fraud Offender: Tenet Heathcare -- $900,000,000 under the False Claims Act. In July 2006, Tenet Healthcare agreed to pay the Federal Government $900 million for billing violations that included manipulation of outlier payments to Medicare, as well as kickbacks, upcoding, and bill padding.

No. 3 Fraud Offender: HCA -- $731,400,000 under the False Claims Act.?In December 2000, HCA The Healthcare Company (formerly known as Columbia HCA), the largest for-profit hospital chain in the United States, pled guilty to criminal conduct and agreed to pay more than $840 million in criminal fines, civil penalties and damages for unlawful billing practices.

No. 4 Fraud Offender: Merck - $650,000 under the False Claims Act.?In January of 2008, Merck settled the very first nominal pricing fraud case in which the company was accused of taking kickbacks and violating Medicaid best price regulations for Vioxx (an arthritis drug), Zocor (a cholesterol drug), Pepcid (an acid-reflux drug), Cozaar (a hypertensive medication), Fosamax (a bone loss drug) Maxalt (a migraine medication) and Singulair (an asthma medication).

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As you read through the “Top 20” list of fiscal malefactors who were either found guilty or agreed to settle in fraud cases against Uncle Sam, one fact stands out with startling clarity: 95 percent of these massively unprincipled cheaters were healthcare players . . . including some of the most venerated names in the pharmaceutical, hospital and health insurance industries.

Unfortunately, however, the taxpayers who are so frequently being bilked by these unscrupulous players haven’t been told that the record already shows how willing the U.S. healthcare industry is to stretch the rules and cheat the public in its ceaseless quest for grotesquely swollen profits.

As a Ph.D. social worker who has spent much of the past 30 years counseling and defending whistleblowers who dare to speak out against fraud against the U.S. government, I learned a long time ago that the U.S. healthcare industry can’t be trusted to provide adequate medical care for the citizenry, or even to obey the laws and regulations that protect the taxpayers from being defrauded.

Make no mistake: That disturbing list of “Top 20” awards against healthcare insurers and the Pharmaceutical industry shows clearly that we cannot leave healthcare to the “profit-oriented” insurance companies and the hospital chains whose greed and willingness to short-change consumers on care is now common knowledge everywhere.

The record shows clearly that allowing the insurers to dictate healthcare policy and healthcare costs can only produce disastrous results. A massive Harvard University study of treatment patterns among patients who were treated in hospital emergency rooms showed that “uninsured” patients were much more likely to die while in the hospital than those who were able to pay the sky-high premiums for adequate healthcare coverage. (To learn more about the study, click on: http://news.yahoo.com/s/hsn/uninsuredtraumapatientsmorelikelytodiestudy).

The first step on the road to getting healthcare reform right is to understand that we are not on a “level playing field,” and that the health industry will stop at nothing to protect its immense profits, regardless of the needless death and the needless suffering their behavior may cause the rest of us.

Donald R. Soeken, founder of the nonprofit Whistleblower Support Fund – a public service organization that supports whistleblowers – can be contacted at: helpline@tidalwave.net and by phone at 301-953-7353. All healthcare fraud cases can be researched on the International Whistleblower Archive at www.whistleblowing.us