When it comes to healthcare fraud prevention, the federal government recovers much more than it spends. In fact, the False Claims Act returned $20 for every $1 invested in healthcare fraud cases, according to a new report from the Taxpayers Against Fraud Education Fund (TAF).
Between 2008 and 2012, the government spent $574.6 million to recover $9.384 billion in federal civil healthcare fraud related settlements and judgments. That represents a more than 16-to-1 return on investment (ROI).
Federal criminal recoveries totaled more than $4.539 billion during that time period, while states collected $4.07 billion in civil recoveries. Factoring in both civil and criminal fines and recoveries yields an even greater total ROI of 20 to 1.
"It is clear that the federal government is getting a tremendous 'bang for the buck' in its anti-fraud activities in healthcare," the report states.
Moreover, the report suggests the ripple effect of large healthcare fraud recoveries makes the industry less likely to face bigger Medicare and Medicaid frauds.
"We don't know exactly how much fraud is being deterred by the False Claims Act, but the number is almost certainly many billions of dollars a year more than is simply being recovered," Jack Meyer, a healthcare economist, said yesterday in a TAF statement.
The report also emphasized the important of preventing healthcare fraud, waste and abuse amid government budget constraints. And the industry needs robust anti-fraud efforts as scammers continue to take advantage of the fact that a majority of Americans remain misinformed about healthcare reform.
However, thanks to budget cuts this summer, the Office of Inspector General can't monitor and investigate as many Medicare and Medicaid fraud and abuse allegations.