The Centers for Medicare & Medicaid Services announced Aug. 28 that it prevented $1.6 billion in fraudulent Medicare laboratory payments. The agency also revoked 157 laboratory providers from the program in one of the largest single anti-fraud enforcement actions in recent years.
The revocations are effective immediately, cutting off billing access for the affected providers and protecting taxpayers and the more than 65 million Americans covered by Medicare, CMS said.
CMS characterized the action as a major blow to a persistent fraud scheme in which illegitimate laboratories submit inflated or fictitious bills for tests that were never performed, were medically unnecessary, or were ordered without proper physician authorization.
Medicare lab fraud has cost taxpayers billions in recent years. The clinical laboratory sector has been one of the most fraud-prone areas of the Medicare program, according to the Department of Health and Human Services Office of Inspector General.
The $1.6 billion in prevented payments represents money that would have been drawn from the Medicare Trust Fund, which finances health coverage for seniors and people with disabilities. Every dollar lost to fraud reduces the program’s long-term financial sustainability.
The 157 revocations in a single action represent a significant escalation from typical enforcement, which tends to address providers individually or in smaller batches. CMS said the scale of the action reflects improvements in data analytics and fraud detection capabilities.
Beneficiaries who received services from the revoked providers will continue to have access to Medicare-covered laboratory services through legitimate providers, CMS said.