In a report out last week, New York Downtown Hospital, was ordered to pay $13.4 million in illegal charges to Medicare and Medicaid. Outlined in the settlement, the New York hospital much return $12.6 million to Medicaid and $800,000 to the federal Medicare program. The allegations leading up to the settlement include, illegally contracting with an out of state vendor for the referral of Medicaid patients and for unlicensed drug and alcohol treatment to patients who were “unlawfully referred there.”
The scheme allegedly took place of the course of 10 years. During the investigation, it was discovered that the hospital entered into an illegal patient referral scheme for which the hospital paid the vendor $38,500 in exchange for the referral of Medicaid patients to its unlicensed inpatient detoxification unit. New York Downtown Hospital has made no admission of liability under the settlement.
Fraud is big business and very profitable, even in unsuspecting places. Well established corporations can fall prey to fraud when the return on investment may help the bottom line in a down economy. Strong internal controls and audit oversight is needed throughout all companies. Fraud departments should also work with internal audit and risk management to shore up any vulnerability points. Increase due diligence of any new vendors, conduct random reviews of internal control, and annual fraud education to keep employees on their toes. We need everyone’s help to stop fraud, says Linda Webb, leading fraud expert aka the Fraud Dog.
To report potentially fraudulent activity, contact Linda Webb aka The Fraud Dog, leading fraud expert at 1-855-FRAUD-DOG.