Fraud 'unavoidable' in gov't-run healthcare

Thursday, January 4, 2018
Steve Jordahl (

stethoscope and cashA massive Medicare fraud – one of the largest in the program's history – clearly demonstrates the federal government isn't cut out to efficiently run healthcare. That's the opinion of a healthcare policy expert with the Cato Institute.

Dr. Solomon Melgen was convicted last April on 67 counts of healthcare fraud after he billed Medicare for more expensive procedures and medicine than he actually provided patients over several years. It was revealed yesterday that the Florida eye doctor could get more than 30 years in prison for defrauding the public health program of more than $100 million.

Dr. Jeffrey Singer of the CATO Institute says Medicare is ripe for fraud.

"There are certain specialties like ophthalmology [and] oncology where there are very expensive medications that you get reimbursed by Medicare for infusing into patients," he tells OneNewsNow. "There are certainly ways in which doctors who are dishonest can game the system."


According to The Associated Press, prosecutors said Melgen was the nation's highest-paid Medicare provider for five straight years.

Singer, who is a general surgeon in private practice in Arizona, says advocates of going to a single-payer system point to Medicare as having much lower administrative costs than the private insurers. There's a reason for that, he explains.

"Most of the private insurers' [administrative] costs deal with adjudicating claims, policing against fraud – because their money is on the line," he says.

With Medicare, the government spends taxpayer dollars on a patient the system will never see. Singer says there's nowhere near the level of oversight to make sure the books are clean.

Medicare"[In the Melgen case] we're probably just seeing the tip of the iceberg," he continues, "because Medicare doesn't spend as much administrative expense on policing and adjudicating claims and protecting against fraud."

He contends the government isn't cut out to run healthcare. "When you're asking for someone to spend someone else's money on something for yet another person, it's going to wind up having a lot of opportunities for error, for mistakes," he argues. "And people who want to take advantage are going to have lots of opportunities to take advantage. It's unavoidable."

Singer says the same problems apply to the much larger Medicaid program.


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