If you like Medi-fraud, you’ll love Obamacare

By Michelle Malkin  •  October 23, 2009 10:47 AM

Hey, just what we and future generations of taxpayers need: Vast new opportunities for out-of-control government health care fraud!

Philip Klein at the American Spectator reports:

Guillermo Denis Gonzalez was released from prison in Florida in 2004 after serving 12 years for murder. By the end of 2006, he owned a health care business officially licensed by Medicare.

This August, the Miami Herald reported that Gonzalez pled guilty to filing $586,953 in phony Medicare claims for supplies that were never given to any actual patients — but this was only after he was arrested for murdering and dismembering another victim, to which he also confessed.

While it’s shocking that government policing efforts are so lax for Medicare that even a convicted murderer can be granted a license to sell equipment and file claims, Gonzalez is actually a small player compared to other cheats. Last June, for instance, the Washington Post ran a story about a high school dropout who scammed $105 million from the federal government by filing 140,000 fraudulent Medicare claims, buying herself a Mercedes-Benz and two condominiums with a portion of the proceeds.

The rampant fraud in existing government health care programs is nothing new, but the problem warrants increased attention given recent reports of growing momentum behind Democrats’ push to create a new government-run program modeled after Medicare.

Earlier this week, the Hill reported that House Democrats were discussing rebranding their so-called “public option” as “Medicare Part E,” or “Medicare for Everyone,” in hopes that it would be an easier sell. And on Thursday, ABC News cited sources who said that Senate Majority Leader Harry Reid planned to include some form of a government plan in Senate legislation.

“I thought the government plan was dead,” Republican Sen. John Thune said during a Wednesday conference call with bloggers. “I don’t think that anymore.”

Proponents of creating a new government plan argue that Medicare is much more efficient than private insurance and boast that it has administrative costs of just two percent. The number is highly misleading in that it doesn’t include many expenses that would be considered when calculating administrative costs in the private sector, because those expenses show up elsewhere in the federal budget. Examples include the cost of tax collection, office space, and staff salaries. The true administrative cost of Medicare is more like 6 percent to 8 percent, according to a 2006 report by the Council for Affordable Health Insurance. But to the extent that Medicare does have lower administrative costs than private insurance, the programs’ defenders ignore one of the consequences: lax oversight of claims that leads to widespread fraud.

Ironically, President Obama has insisted that he will cut several hundred billion dollars out of Medicare’s budget without affecting benefits simply by eliminating waste, fraud, and abuse — yet he simultaneously makes the case that creating a new government plan is necessary to improve efficiency in the health care system.

The Debt Death Sprial

By Steve McCann

America’s economy faces a miserable future, according to an important government report. The media collectively have yawned, and official Washington has barely blinked. The Government Accountability Office recently issued its report to the Congress on the long-term fiscal outlook for the United States.   It is a bleak picture.  The report opens:

Weakness in the economy and financial markets — and the government’s response to them — have contributed to near-term increases in federal deficits, which reached record level in fiscal year 2009.  While a lot of attention has been given to the recent fiscal deterioration, the federal government faces even larger fiscal challenges that will persist long after the return of financial stability and economic growth.

And:

…the federal government is on an unsustainable fiscal path.