How Medicare Deals with and Prevents Fraud for its Beneficiaries
Part 3, Chapter 9: Medicare and Medicare Related Programs: Medicare Page 12
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However, although those mechanisms have been effective in some cases, there also appear to be a number of circumstances in which they don't seem to work very well.
The Portability and Accountability Act, passed in the summer of 1996, attempts to deal with the problem of fraud by providing for the establishment of a new Medicare fraud prevention program and a new Medicare Beneficiary Incentive Program.
The fraud prevention program is designed to investigate fraud and payment errors. For the most part, the program is likely to affect providers rather than beneficiaries, although there may be a new educational program for beneficiaries, as well. That program is designed to help increase beneficiaries' understanding of Medicare rules.
The Medicare Beneficiary Incentive Program affects beneficiaries directly. The program is designed to encourage Medicare beneficiaries to report possible cases of fraud. The basic concept is that if those reports result in a recovery of funds, the Medicare beneficiary who originally made the report may receive a portion of those funds. Until that program is fully developed, Medicare beneficiaries can continue to report cases of possible fraud to the Medicare Inspector-General (See Appendix B).
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