is a particular problem for MediCal, California’s Medicaid program. Medicare is harder to defraud because the insurance forms go out to the recipients. But Medicaid doesn’t send out notices of what claims are being submitted, so there’s no paper trail to track down criminals.
Physician identities are accessible from sources such as a state medical board’s Web site, local physician directories or the Yellow Pages.
Physician names, as well as copies of medical licenses and office addresses, also can be stolen from hospital personnel files. The criminals submit the documents to the state health department to obtain Medicaid provider numbers and then tell the state Medicaid program that the physician has a new address and request payment at that address. If the physician 101
T H E M E C H A N I C S O F I D T H E F T
doesn’t have a Medicaid provider number, crooks will use the stolen identities to file for one.
Another tactic involves stealing the names, Social Security numbers or identification numbers of Medicaid and Medicare beneficiaries. Both patient information and physician information are necessary to bill the programs.
Once armed with the physician’s name and provider numbers, as well as stolen patient information, criminals can submit bogus claims to Medicaid or Medicare .
The reimbursement checks are either mailed to the clinics, labs or post office box addresses, or directly deposited to bank accounts opened under the physicians’ stolen identities. The crooks then forge the physicians’ signatures on the checks that the state sends them.
This type of fraud can go on for years, until the physician gets a call from the Internal Revenue Service, asking why she didn’t pay taxes on $400,000 of income received from Medicaid. Neither Medicaid nor the physician knew what was going on.
In early August 2002, a claims entry operator for Wisconsin Physicians Service was charged with identity theft after he allegedly supplied personal information of WPS clients to a Milwaukee man who used it to apply for credit cards.
Mario L. Mason, who worked for WPS subsidiary Tricare health insurance, allegedly took names and personal data from claims he processed for Tricare 102
C H A P T E R 4
and gave them to Milwaukee resident Marques J.
Kincaid, who used the information to fill out credit card applications on the Internet.
Mason and Kincaid were each charged with identity theft. According to a criminal complaint, they had become acquainted while serving time in the Dane County Jail several months earlier. Kincaid used the name and personal information of an Arlington, Texas, man to obtain a credit card that he used to obtain cash advances of more than $8,000.
Why Tricare didn’t run a background check on Mason—the employee who had access to so much personal financial information—remained an unan-swered question.
Federal law enforcement agencies are particularly aware of medical ID theft issues. The Department of Health and Human Services , cooperating with the FBI, uses a sophisticated software data mining tool to analyze all claims submitted by medical providers and pharmacies and compare them against member enrollment data and other information.
Unusual billing practices are targeted for an in-depth audit or investigation.
Such schemes include: submitting altered medical bills; billing for services never received; doctor-shopping to obtain multiple prescriptions for controlled substances; and stealing a physician’s pre-103
T H E M E C H A N I C S O F I D T H E F T
scriptions pad and submitting forged prescriptions for controlled substances to pharmacists.
The software data mining tool helped the FBI build a case against Richard J. Farina and his business, Pennsylvania-based Inner Health Lifestyle Center.
Farina and Inner Health each pled guilty to two federal felony counts of health care fraud for submitting fraudulent bills to the local Blue Cross and its subsidiary, Keystone Health Plan
Physician identities are accessible from sources such as a state medical board’s Web site, local physician directories or the Yellow Pages.
Physician names, as well as copies of medical licenses and office addresses, also can be stolen from hospital personnel files. The criminals submit the documents to the state health department to obtain Medicaid provider numbers and then tell the state Medicaid program that the physician has a new address and request payment at that address. If the physician 101
T H E M E C H A N I C S O F I D T H E F T
doesn’t have a Medicaid provider number, crooks will use the stolen identities to file for one.
Another tactic involves stealing the names, Social Security numbers or identification numbers of Medicaid and Medicare beneficiaries. Both patient information and physician information are necessary to bill the programs.
Once armed with the physician’s name and provider numbers, as well as stolen patient information, criminals can submit bogus claims to Medicaid or Medicare .
The reimbursement checks are either mailed to the clinics, labs or post office box addresses, or directly deposited to bank accounts opened under the physicians’ stolen identities. The crooks then forge the physicians’ signatures on the checks that the state sends them.
This type of fraud can go on for years, until the physician gets a call from the Internal Revenue Service, asking why she didn’t pay taxes on $400,000 of income received from Medicaid. Neither Medicaid nor the physician knew what was going on.
In early August 2002, a claims entry operator for Wisconsin Physicians Service was charged with identity theft after he allegedly supplied personal information of WPS clients to a Milwaukee man who used it to apply for credit cards.
Mario L. Mason, who worked for WPS subsidiary Tricare health insurance, allegedly took names and personal data from claims he processed for Tricare 102
C H A P T E R 4
and gave them to Milwaukee resident Marques J.
Kincaid, who used the information to fill out credit card applications on the Internet.
Mason and Kincaid were each charged with identity theft. According to a criminal complaint, they had become acquainted while serving time in the Dane County Jail several months earlier. Kincaid used the name and personal information of an Arlington, Texas, man to obtain a credit card that he used to obtain cash advances of more than $8,000.
Why Tricare didn’t run a background check on Mason—the employee who had access to so much personal financial information—remained an unan-swered question.
Federal law enforcement agencies are particularly aware of medical ID theft issues. The Department of Health and Human Services , cooperating with the FBI, uses a sophisticated software data mining tool to analyze all claims submitted by medical providers and pharmacies and compare them against member enrollment data and other information.
Unusual billing practices are targeted for an in-depth audit or investigation.
Such schemes include: submitting altered medical bills; billing for services never received; doctor-shopping to obtain multiple prescriptions for controlled substances; and stealing a physician’s pre-103
T H E M E C H A N I C S O F I D T H E F T
scriptions pad and submitting forged prescriptions for controlled substances to pharmacists.
The software data mining tool helped the FBI build a case against Richard J. Farina and his business, Pennsylvania-based Inner Health Lifestyle Center.
Farina and Inner Health each pled guilty to two federal felony counts of health care fraud for submitting fraudulent bills to the local Blue Cross and its subsidiary, Keystone Health Plan
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