Recently introduced legislation in the House would prevent corporate executives from doing business with Medicare if their companies were convicted of fraud - even if the conviction occurs after their departure. It also would exclude parent companies that may be committing fraud through shell companies, according to The Hill.
The Strengthening Medicare Anti-Fraud Measures Act (H.R. 6130), introduced by Reps. Pete Stark (D-Calif.) and Wally Herger (R-Calif.), addresses two gaps that exist in fighting Medicare fraud. "Law enforcement officials have informed Congress that there are gaps in our current anti-fraud laws, and I am pleased to join Chairman Stark in offering legislation to close the loopholes so that these offenders will pay the price for their crimes," Herger said.
Under current law, executives from companies that are convicted of fraud can be excluded from Medicare, but if executives left the company by the time of conviction, they cannot be barred from federal health programs. These executives can move from one company to another and continue to defraud Medicare. Additionally, companies that engage in fraud often set up shell companies to insulate themselves from liability. Current law allows for dissolution of these shell organizations with no real penalty to the parent company.