Patient Whistleblower Exposes $150 Million Medicaid Fraud
EmailIn a real-life David versus Goliath story, a 63-year-old wheelchair-bound Medicaid patient took on the multi-billion-dollar healthcare giant Maxim Healthcare. And he won.
Today the House Oversight Committee heard the saga of how Richard West exposed Maxim’s widespread Medicaid fraud and helped government officials reclaim millions for the cash-strapped program.
“This [fraud] is wholly unacceptable,” said Rep. Trey Gowdy, R-S.C., “This is why people have lost trust in the insitutions of government and why our fellow citizens have so little trust that we are spending their money as carefully as we would spend our own.”
Richard West is in a wheelchair, uses a ventilator and needs oxygen. He also needs Medicaid so he can stay at home while getting care.
In March of 2003, West started receiving that in-home care but in September of 2004 New Jersey state officials suspended his Medicaid benefits claiming he had exceeded his monthly cap. West knew that was wrong. He keeps good records.
West determined that his healthcare provider, Maxim, had billed Medicaid for 735 hours of nursing care he never got, fraudulent charges that amounted to more than $20,000.
Armed with the evidence, West complained to New Jersey officials. They ignored him.
Next he went to Medicaid. They didn’t care.
He took his case to a social worker, but the social worker did nothing.
So West found an attorney who filed a whistleblower lawsuit under the False Claims Act and that triggered an investigation of Maxim.
“Somebody decided to make a profit on my disability and rip off the government,” West, also a Vietnam War veteran, told the committee. “That was wrong and the right thing for me to do was expose it.”
Today, seven years later, Gary Cantrell, a top government investigator in the Health and Human Service’s Inspector General’s office, told Congress that West is the reason Maxim Healthcare got caught and recently agreed to pay more than $150 million to “resolve civil and criminal charges,” the “largest ever involving home healthcare services.”
But Rep. Elijah Cummings, D-Md., said that fine was nothing more than a “slap on the wrist.”
“Here we have Maxim, a company that has basically stolen, stolen from the American people,” Cummings animatedly said at Wednesday’s hearing. “Maxim, a country that has taken away the services not only from you, but from so many others, but yet and still they are in a position to continue to make millions. Something is absolutley wrong with that picture.”
Cummings said it was “ridiculous” that Maxim can “steal millions” and continue to be employed by the federal government when a young man who steals a $300 bike will have a criminal record “not be able to get a job for a lifetime.”
“I cannot understand for the life of me how every member of this Congress should not want to put Maxim out of business, at least with regard to its business with the federal government,” Cummings said.
Nine people–eight former Maxim employees, including three senior managers and the parent of a former Maxim patient–have pleaded guilty to felony charges for committing fraud, Cantrell testified.
Under the whistleblower protection act, West will receive $14.8 million from the fine Maxim will pay.
“It is impossible to believe that Mr. West’s story is isolated,” Gowdy said. “Medicaid is designated a high-risk program and is therefore highly susceptible to waste, fraud and abuse. ”
In fiscal year 2010, whistleblowers like West helped recover $2.39 billion lost to fraud, according to a Taxpayers Against Fraud report cited in West’s attorney’s testimony. Gowdy said as much as one-fifth of the money Medicaid spends is wasted on fraud.
A provision of the Affordable Care Act provides an additional $350 million over the next decade to help fight fraud, resources Cummings said were necessary to prevent cases like West’s.
“When we invest in fraud prevention government spending more than pays for itself,” Cummings said. “That is one reason why repealing the Affordable Care Act and cutting Medicaid’s enforcement budget would be very short sighted and indeed counter-productive.”
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If there were no Medicaid, there would be no fraud. Close many government programs..NASA, Social Security, Dept. of Energy, and Dept. of Education – For starters….
Posted by: Ned | December 7, 2011, 10:31 am 10:31 am
I’d like to report a suspected fraud that occurred in a $433 MILLION no-bid contract for a dubious smallpox vaccine ordered from Siga Technologies. DEMOCRATS have a problem with no-bid contracts, but only when they go to Halliburton. If it goes to a bunch of oBama supporters? No problem.
Posted by: Michelle Shu Jas | December 7, 2011, 10:36 am 10:36 am
The moral of the story: Don’t be a whistle blower because you’ll be ostrisized at best, harrassed and or demoted or arrested at worse. All this under an administration that was going to be better (at this) that former admins?
Posted by: deanbob | December 7, 2011, 10:45 am 10:45 am
Well, NED, I see you’re a Ron Paul supporter. Before spouting the party line, try examining for yourself what the impact would be on the entire nation if all of the agencies you mention suddenly didn’t exist. I’m not sure you could comprehend the devastation to the economy and to people. All of those agencies have problems, but there’s a reason for them existing, which may not be obvious to you. Do some research.
Posted by: Bob | December 7, 2011, 10:49 am 10:49 am
This may go down as 1 of the most corrupt admins ever.
Posted by: deanbob | December 7, 2011, 10:49 am 10:49 am
Obamacare cuts $500 billion from these programs, any one seen any cuts of fraud by this administration? This whole administration is a fraud, look at Dept. of Energy,, Dept of Justice Holder, Homeland Security, public workers taking FEMA money and the list goes on and on. Corruption from top to bottom.
Posted by: Freedom | December 7, 2011, 11:22 am 11:22 am
bob wrote:”Before spouting the party line, try examining for yourself what the impact would be on the entire nation if all of the agencies you mention suddenly didn’t exist.”
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Better to collapse the whole nation from the unsustainable spending currently under way. But, just think, it would bring about the REAL Hope and Change that oBama wants even faster.
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” I’m not sure you could comprehend the devastation to the economy and to people.”
.
Back at you….
Posted by: Michelle Shu Jas | December 7, 2011, 11:23 am 11:23 am
The notable fact here, is that after much talk about cracking down on medicare fraud, Obama administration officials did NOTHING when presented with the evidence.
Obama is a fraud, about everything. He just gives speeches, and then promptly forgets what he said.
Posted by: Rick McDaniel | December 7, 2011, 11:25 am 11:25 am
I love how many of you are condemning the current administration. The fraud took place in 2003 and 2004 – DURING THE REPUBLICAN TRIUMVIRATE IN THE WHITE HOUSE AND CONGRESS. THEY wasted the money and made sure their buddies got paid. wonder if the $150million settlement included a provision where Maxim does not have to admit guilt.
Posted by: pksk531 | December 7, 2011, 11:27 am 11:27 am
Not seeing my last post so I will do it again. many are condemning the current administration when the article clearly states it took place in 2003-2004 and he was ignored. That puts this squarely in the laps of the REPUBLICAN Congress and White House.
Posted by: pksk531 | December 7, 2011, 11:34 am 11:34 am
RICK MCDANIEL | DECEMBER 7, 2011, 11:25 AM…..”Obama is a fraud, about everything.”…..I’d guess Obama (or someone one direct orders from Obama) gave assurances of a quid pro quo to many of his Solyndra like contributors. He has yet to address the corruption of another of his large contributors – Corzine – who stole billions. And the the only retribution to Corzine or MF Global, so far, has been to penalize the clients of MF Global. Add to that How many Wall St execs have been indicted or sent to jail for causing the financial collapse of 2006-2008?
Posted by: deanbob | December 7, 2011, 11:38 am 11:38 am
Jack Abramoff is shaking his head…. darn… should have given more to the DEMOCRATS….. then I could be protected like Corzine.
Posted by: Michelle Shu Jas | December 7, 2011, 11:46 am 11:46 am
Ok, the article is about 2005. My question is what is the current admin (now in office near 3 years) doing about waste fraud and abuse? If MF Global, Solyndra, “Fast and Furious, Boeing in S Caroline are any indication, this current admin is facilitating it.
Posted by: deanbob | December 7, 2011, 11:53 am 11:53 am
Pksk531, thanks for pointing out the time frame that these abuses were not dealt with by Bush administration officials, not during Obama’s administration.
Republicans here seem to have trouble with simple math.
I’m glad the bad guys got caught but Congress needs to toughen up the penalties. This crooked business should be shuttered and anyone who worked for their administration should be banned from working in insurance or any part of the health field.
Posted by: Librarian53 | December 7, 2011, 12:12 pm 12:12 pm
Deanbob, no, the moral of the story is that the Bush administration dropped the ball when they refused to investigate this man’s claims.
And the moral of the story is that whistle blowing can be lucrative as the patient received $14 million dollars for his trouble! Thanks, Mr. West for helping to catch the rats!
Posted by: Librarian53 | December 7, 2011, 12:15 pm 12:15 pm
You guys have GOT to read the entire article,not just the first paragraph: “A provision of the Affordable Care Act provides an additional $350 million over the next decade to help fight fraud, resources Cummings said were necessary to prevent cases like West’s.
“When we invest in fraud prevention government spending more than pays for itself,” Cummings said. “That is one reason why repealing the Affordable Care Act and cutting Medicaid’s enforcement budget would be very short sighted and indeed counter-productive.”
Posted by: pksk531 | December 7, 2011, 12:20 pm 12:20 pm
I would love to know when the American people will get fed up with all the fraud in the Medi-cal, Medicaid, AFDC, and food stamp programs. The government doesn’t seem to give a damn how much taxpayer money is wasted.
Posted by: moonie | December 7, 2011, 12:21 pm 12:21 pm
many are condemning the current administration when the article clearly states it took place in 2003-2004 and he was ignored. That puts this squarely in the laps of the REPUBLICAN Congress and White House. Posted by: pksk531 | December 7, 2011, 11:34 am.
Shhhh. Don’t confuse the Right Wing ‘All Hate All the Time’ crowd with the facts. They’ll turn on you like a month old avocado……….
Posted by: Searambler | December 7, 2011, 12:35 pm 12:35 pm
The moral of the story: Don’t be a whistle blower because you’ll be ostracized at best, harassed and or demoted or arrested at worse. All this under an administration that was going to be better (at this) that former admins? Posted by: deanbob | December 7, 2011, 10:45 am.
A) This happened seven years ago, under the previous Republican administration. B) Mr. West did the right thing, and got a $15 million reward for it. C) Who ostracized, harassed, demoted, or arrested Mr. West? D) Even IF Mr. West was subjected to something like you said, it’s STILL the right thing to do, exposing crimes like this. Because if everyone took YOUR attitude, then nothing would ever change…………
Posted by: Searambler | December 7, 2011, 12:41 pm 12:41 pm
searambler wrote:”Shhhh. Don’t confuse the Right Wing ‘All Hate All the Time’ crowd with the facts. They’ll turn on you like a month old avocado……….”
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DEMOCRATS don’t have a problem with this fraud since it typically benefits one of their constituents and it has a chance of making it back into their campaign coffers. When called on it, they revert back to the old “waahhh…but Bush did it too… waahhh”.
Posted by: Michelle Shu Jas | December 7, 2011, 12:45 pm 12:45 pm
I’d agree with the article, if Maxim stole money from the American People, Maxim Healthcare should never be allowed to work for Medicaid again. that would put a stop to all this fraud. lets punish these companies.
Posted by: Fezzy Bear | December 7, 2011, 12:58 pm 12:58 pm
Michelle Shu Jas | December 7, 2011, 12:45 pm post ———— You are a liar. You lie. You do not tell the truth. You must be a Conservative Christian Republican………
Posted by: Searambler | December 7, 2011, 1:03 pm 1:03 pm
Ned, so by your logic we should ignore all the good Medicaid does poor sick people because some companies commit fraud? Couldn’t we just catch the criminals, put stronger penalties in place, like mandatory jail time for the worst offenders, rather than throw the baby out with the bathwater?
Posted by: Librarian53 | December 7, 2011, 1:14 pm 1:14 pm
This may go down as 1 of the most corrupt admins ever. Posted by: deanbob | December 7, 2011, 10:49 am…………….Exactly how does that work? The fraud was committed in 2004 and discovered, finally, during this administration. Can you see how your words have no logic and make no sense?
Posted by: Taintedbylies | December 7, 2011, 1:21 pm 1:21 pm
Ned, please do some basic research on Siga before you start spreading lies…The amount of misinformation going on regarding this contract is astounding. First off Siga’s St-246 is not a vaccine, it is an antiviral. There is a major difference. If you are infected with smallpox, become symptomatic, and try to treat with vaccine, you are dead meat. If you use St-246 in time, you will live…. IT IS A REVOLUTIONARY DRUG AND A CURE FOR SMALLPOX (VARIOLA) and all other orthopox infections. Secondly, while the disease was eradicated from in the 1980’s by the World Health Organization, it IS still a threat because of synthetic biology. Synthetic biology, is not science fiction. Do the research and you’ll see for yourself that the genome for variola (smallpox) is readily available in the public domain and can be created in a laboratory setting. This threat is real as well as Siga’s drug. It is a shame to see the facts getting lost in the political rhetoric. PS, I am not an Obama supporter, in fact I would love to see him replaced in the next election.
Posted by: Mark Nutello | December 7, 2011, 6:29 pm 6:29 pm
mark nutello wrote:”IT IS A REVOLUTIONARY DRUG AND A CURE FOR SMALLPOX (VARIOLA) ”
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Did you volunteer to be guinea pig for it? Know anybody that did?
Posted by: Michelle Shu Jas | December 7, 2011, 6:49 pm 6:49 pm