Running Head: Fraud and Abuse

Fraud and Abuse in the U.S. Healthcare System
Tenisha Howard
Keller Graduate
Professor Cutspec
June 12, 2011

Background
People can be affected by healthcare fraud and abuse directly and indirectly. Fraud is defined as an intentional deception, false statement or misrepresentation made by a person with the knowledge that the deception could result in unauthorized benefit to oneself or another person. It includes any act that constitutes fraud under applicable federal or state law. Abuse is defined as practices that are inconsistent with professional standards of care; medical necessity; or sound fiscal, business, or medical practices. Intent is the key distinction between Fraud and Abuse. An
Despite federal legislation and a commitment of millions of dollars to fight fraud and abuse, research suggests that less than 5 percent of the losses from fraud and abuse are recovered annually (Eberhart III, Hart-Hester, Pierce, & Rudman, 2009). After making more than $70 billion in improper Medicare and Medicaid payments last year, CMS should focus on five key strategies to help reduce waste, fraud, and abuse and improper payments in Medicare and Medicaid, according to a Government Accountability Office (GAO) report: strengthening provider enrollment standards and procedures, improve payment review of claims, focus post payments claims review on most vulnerable areas, improve oversight of contractors, and develop a robust process for addressing identified vulnerabilities, (“Urgent need for," 2011). In a report about OIG, Julie Taitsman stated “Good medical record-keeping not only ensures that you’re billing appropriately, it also promotes better patient care because everyone treating that patient should be able to see the full documentation of your patient encounter ("Is your doctor," 2011).
Problem Analysis Vicarious liability allows for liability for a wrongdoing to be broadened beyond the
Original wrongdoer to persons who have not committed a wrong but on whose behalf the wrongdoer acted. This theory potentially provides the