Fraud plagues government health care

Two recent headlines convey a disturbing contradiction: "Medicare fraud: A $60 billion crime" ("60 Minutes"), and "Reid to announce push for public option" (Politico). The former is the latest in a long parade of similar articles about Medicare, the government's biggest health care program. The latter updates liberal Democrats' continued effort to expand government health care despite its long and dreary record of waste and fraud.

Indeed, Medicare corruption has been so extensive for so long that the terms "federal health care spending" and "waste, fraud and abuse" are virtually synonyms. In May 1986, for example, Department of Health and Human Services Inspector General Richard Kusserow reported that in the prior six months 65 people were convicted of attempting to defraud Medicare, Medicaid or Social Security, with savings of more than $50 million as a result. During his long tenure as the department IG from 1982 to 1991, Kusserow unearthed hundreds of millions of dollars in fraud and helped gain convictions of thousands of people.

Nothing much has changed in the 23 years since Kusserow's 1986 report. Last Sunday, "60 Minutes" broadcast a devastating segment featuring a depressing progression of government and private lawyers, law enforcement officers, auditors, investigators, and people convicted of Medicare fraud explaining why and how ripping off Medicare has become one of the easiest and most profitable crimes in America.

One of the criminals explained that Medicare management was so lax that he got $150,000 by claiming reimbursement 10 times for a "gas-powered prosthetic arm." The same criminal said there are "thousands" of companies in the Miami area being paid for such fraudulent claims every day. A lawyer with extensive experience defending those accused of Medicare scams told "60 Minutes" that Medicare fraud is bigger than the drug trade in South Florida.

Predictably, Attorney General Eric Holder told "60 Minutes" the government needs a bigger budget and more employees before it can stop the fraud. But HHS has worked for more than two decades to clean up Medicare fraud and currently has more than 63,000 employees. If, after working all those years -- with the Justice Department, FBI and state authorities -- HHS still can't stop Medicare fraud, why is hiring more people and fattening up the department's budget going to do the trick?

Kusserow told the San Francisco Chronicle in 2003 that every time the government nailed one abuse, three new ones soon took its place. We hear a lot these days about companies that are "too big to fail." We should worry even more about government that has grown too big to do anything but fail.