Elder Fraud in the USA - Essay Example

 Elder Fraud in the USA Abstract: Elder fraud is a contributor to increasing healthcare costs in America. This research paper will discuss the types of elder frauds and offer recommendations on solving elder fraud. American senior citizens are vulnerable to health care fraud due to their limited cognitive capability and desire for cheap healthcare solutions. Lifestyle diseases such as obesity and cancer and desire for a youthful appearance have made many elders vulnerable to fake anti-aging products and telemarketing frauds. Elder fraud Introduction Healthcare frauds targeting senior citizens have now been classified as a 21st century crime due to their prevalence (Busch, 2012). Many of the elder frauds are unreported but leave the senior citizens in devastating situations since most of them have little time to recoup the losses. Surprisingly, most of the elder frauds against the senior citizens are committed by family members and mainly the adult children or grand children. Some of the common frauds include Medicare or health insurance frauds where the perpetrators pose as genuine Health insurance agents in order to obtain personal information from the elderly people or provide inferior services in small clinics and bill the costs to Medicare (Busch, 2012). Another common elder fraud in nursing is counterfeit prescription drugs which mainly are conducted through the internet. Elder people usually obtain drugs that may even lead to more harm and worsening of their medical conditions (Federal Bureau of Investigations, 2012). This research paper will discuss types of elder fraud in the United States and offer recommendations on how to deter the fraud. The paper will utilize available literature on books and journals in order to understand elder fraud problem in the United States of America. Literature review According to figures released by the Federal Bureau of Investigations, health care related frauds cost the US economy about $ 250 billion every year. Elder fraud is one of the contributors of the skyrocketing medical costs in the US healthcare systems. Controlling elder fraud is difficult since the fraudsters who established sophisticated fraud schemes that entail overbilling the elderly patient, billing for more hours in a day or even charging the elder for services which were not offered (Busch, 2012). Elder people are polite and have excellent credit that makes them vulnerable to health care frauds. Elderly people also make poor witnesses since they do not provide detailed evidence and information to law enforcement officers due to their age effects on memory. Elderly people are also interested in products or medicines that increase their cognitive functioning, physical conditioning, and anti-cancer products thus increasing their vulnerability to fraudsters (Busch, 2012). The most common type of elder fraud is Medicare or health insurance fraud. All US citizens over the age of 65 years are eligible to Medicare plan that is primary financed by the federal government. “The fraudsters usually pose as agents of medical insurance companies or Medicare in order to obtain the victim’s personal information such as credit card details” (Federal Bureau of Investigations, 2012, p 2). The perpetrators may also provide sub-standard medical services in mobile clinics and charge the services to Medicare in order to pocket the money. Other smaller frauds on Medicare and health insurance include the medical equipment fraud whereby the equipment manufacturers may offer free medical equipment to the elderly but the insurers are charged for the equipments even when they have not been delivered. Rolling lab fraud schemes is a common elder fraud which takes place when elderly people unnecessary or fake medical tests at their retirement homes or health clubs and the bogus service is charged to Medicare or the insurance companies. Fraudsters usually enter in to a fraud coalition with medical doctors who are required to issue certified forms that an equipment is needed or medical tests are necessary in order bill the Medicare for services which may not be provided and which are not necessary to the elderly person (Price & Norris, 2009, p. 287). Other Medicare frauds committed against the elderly patients include reflex testing whereby the fraudster automatically runs another medical test if the results of the initial test fall under a certain range even without the approval of the physician. Billing of defective tests which happen due to machine malfunction or destroyed samples and code jamming in diagnosis codes in order to obtain Medicaid coverage are other common frauds in healthcare. Submitting multiple claim forms and inappropriate cost reports in order to obtain higher reimbursements from medical insurance companies and also listing complicated reports and additional complications that are non-existence in a common fraud against the senior citizens (Busch, 2012). Counterfeit drug prescription is another common elder fraud that takes place mainly through the internet. The elderly patient may be conned to purchase sub-standard drugs that might be harmful to their health condition. “Elderly people may not have the visual capability to closely examine the packaging and contents of drugs purchased from the fake physicians (Busch, 2012, p 109)”. Another type of elder fraud is funeral and cemetery fraud. This is a sophisticated fraud since the fraudsters will read obituaries and call the public to attend a funeral service of a stranger in order to take advantage of the grieving elderly widower or widow (Federal Bureau of Investigations, 2012). The con artists will make claims that the deceased had outstanding debts and try to solicit money from the relatives in order to settle the non-existing medical debts. The con artists will also try to fraudulently increase the funeral costs if the relatives are unfamiliar with the funeral expenses. For instance, an expensive burial casket can be replaced with a cardboard even when direct cremation of the remains of the deceased is being performed (Price & Norris, 2009). Fraudulent anti-aging products schemes are a common fraud against the elderly citizens. Many elderly people wish to conceal their old age in order to participate in social circles and gain acceptance in social groups and places such as in business. Older American citizens prefer using treatments that will maintain their youthful appearance. A common anti-aging fraud against the elderly is the Botox case in Arizona where the product contained botulism neurotoxin that is a dangerous and toxic chemical. The fraudsters will claim that the anti-aging product is capable of healing several medical conditions and has been approved scientifically which is not true since these products have secret formulas that are dangerous to the health of elderly people. Telemarketing fraud is another common nursing fraud on elderly citizens in the United States of America (Busch, 2012). This involves inexpensive vacations, free prizes and low cost vitamins that fraudsters claim are intended at boosting the immune system of elderly person. Telemarketing frauds are difficult to trace and investigate since no face-to-face meetings are involved and no paper work details are signed (Federal Bureau of Investigations, 2012). These frauds take place in the form of charity frauds whereby the fraudsters solicit money for non-existence charity activities or fake accident ploys whereby the elderly person is connected to send money to a close relative who they claim is in hospital or has been involved in an accident (Busch, 2012). Many elderly people have been forced to pay bribes in order to access certain medical services. Due to limited knowledge on types of services covered by their health care insurance, elderly patients are conned by dishonest health care providers to provide bribes in order to access certain medical services like drugs or laboratory tests. Internet fraud and investment schemes are other frauds that mainly target the elderly patients. Investment scheme frauds include advance fee frauds, pyramid schemes while internet frauds include non-delivery of goods and services purchased online, debit and credit cards frauds. The elderly people are may receive e-mail messages from the con artists requiring them to verify their Medicare details with the fraudster in order to receive a medical expense refund or special discounts (Stone, 2011). These fraudsters will obtain the credit card information of the elderly people and transfer any funds in the elderly person’s bank account. Reverse mortgage frauds is another common fraud which entails different fraudsters from the real estate sector, and financial sector. The elderly people are offered investment opportunities, refinance assistance and free homes. The seniors are intended to act as straw buyers since senior citizens over the age of 62 years can occupy a house as a primary residence or own the property before completion of mortgage payments (Stone, 2011). Medicaid and Medicare finance more than one quarter of the US health care expenses. About ten percent of Medicare costs are spent fraudulently thus leading to the increasing healthcare costs in the economy. Health insurance Portability and Accountability Act of 1996 have not been able to detect and adequately deter elder fraud in Medicare. The Beneficiary Incentive programs have failed in controlling elder fraud since majority of senior citizens have limited cognitive capability and knowledge to identify and report healthcare frauds. The False Claims Act penalties for inaccurate and fraudulent billing practices are so low while Prescription drug Marketing Act has not fully been enforced in order to deter fake repackaging and sale of counterfeit drugs to elder patients (Stone, 2011). Recommendations for resolving elder fraud Elderly patients can control healthcare fraud by refusing to sign any blank insurance forms and maintaining accurate records of all health care appointments. Elderly people should desist from purchasing prescription drugs from unauthorized pharmacies and not falling victim to counterfeit drug promotions that purport to offer special deals (Federal Bureau of Investigations, 2012). For funeral and cemetery fraud, the elder person should carefully read all contracts documents and know the funeral home basic fees and any other professional services fees. The elder patient should consult his physician before buying any nutritional supplements and avoid responding to unsolicited advertisements. Elder people should remain cautious of health fairs and rolling lab tests or free treatments that promise to waive part of the medical costs with the rest been covered by the insurance company (Federal Bureau of Investigations, 2012). The US Department of Justice and Health care Fraud division should be strengthened to deter elder fraud. Heavy penalties including life imprisonment should be imposed to those selling counterfeit drugs or engaging in fraudulent billing of the elderly patients. Law enforcement officers should be trained on how to identify and trace elder fraud through inspection of claim records and payment records. Advanced analysis software predictive modeling techniques should be implemented at all payment and claim points in order to compare transaction patterns and identify any unusual payments. The Medicare authorities should educate the elderly patients on the services provided by the insurance plan and how they can track expenses billed by the health facilities (Stone, 2011). Conclusion Elder fraud is responsible for the increasing Medicare health costs. Elder people are more vulnerable to health care fraud due to limited knowledge of their health insurance plans and poor memory capacity. Some of the elder frauds which are common include fraudulent billing, rolling lab tests, code jamming, counterfeit prescription drugs, fake anti-aging products and telemarketing frauds. However, elder fraud can be controlled by strengthening law enforcement inspection of medical claims, educating the elderly citizens on how to detect fraud and imposing heavier penalties to the perpetrators. Advanced analytics software should be utilized to detect any abnormal billing patterns while all pharmacies should be strictly licensed and regulated. References: Busch, R.S. (2012). Healthcare fraud: auditing and detection guide. New Jersey. John Wiley & Sons. Federal Bureau of Investigations. (15th September, 2012). Common fraud schemes: fraud target senior citizens. Retrieved from http://www.fbi.gov/scams-safety/fraud/seniors . Price, M & Norris, D. (2009). “Health care fraud: Physicians as white collar criminals”. Journal of the American academy of Psychiatry and the law online. Vol 37(30: 286-289. Retrieved from http://jaapl.org/content/37/3/286.full Pyrek, K.M. (2011). Healthcare crime: investigating abuse, fraud and homicide by caregivers. New York. CRC Press. Stone, C.L. (2011). Geriatrics. Santa Barbara. Greenwood Publishing. Read More