We spoke with attorney John LeBlanc of Manatt, Phelps & Phillips about the rise of healthcare fraud.
“Over the last ten years or so, it has become increasingly easy to commit healthcare fraud because of advances in technology and information increases,” said LeBlanc. “There is a lot more information out there, so it makes it easier for people to steal.”
LeBlanc went on to explain how this has impacted businesses.
“Healthcare fraud is expensive for commercial enterprises,” he said. “The top-line cost of healthcare fraud comes in the form of higher premiums because there are always some providers who overcharge.”
Additionally, LeBlanc added that companies often absorb these costs, which can be financially crippling in the long term.
“The second type of cost is when you are defrauded, your company loses money,” he said. “The third type is when you are impaired with criminal liability.”
When asked what businesses can do to prevent healthcare fraud, LeBlanc suggested that companies hire attorneys or forensic accountants to investigate suspicious activity.
“These people are good at uncovering fraud, and hopefully, they can catch it before it gets out of hand,” he said. “In all likelihood, you’re going to have a lot fewer problems if you take these precautious measures.”
Additionally, LeBlanc explained that many cases of healthcare fraud go unreported.
“A lot of the time, we see people committing healthcare fraud over and over,” he said. “People go to prison for a little while. Then, they get out and continue committing the same crimes.”
This is why LeBlanc stressed that it’s vital to cooperate with investigators and report suspicious activity as soon as possible.
“The longer you wait, the more difficult it becomes to reconstruct what happened and thus prove that a crime occurred,” he said.
“We live in a world that’s run on data,” added LeBlanc. “If you have robust data controls and good computer security, you’re going to have fewer problems from healthcare fraud.”
For companies to protect themselves from healthcare fraud, LeBlanc says they must be proactive.
“We live in a world where information is at our fingertips,” he said. “In many cases, the faster you respond to a problem, the more likely it is that you can contain it.”
LeBlanc further argued that there is little downside to being proactive.
“All of this stuff costs you money if you don’t do it,” he said. “The government is cracking down on healthcare fraud. They’re going after people, and we see this in the news all the time.”
“The law views whistleblowers as an asset,” he added. “It is just another method of uncovering criminal conduct.”
LeBlanc concluded by sharing research that found that 48% of companies experience a moderate to severe level of healthcare fraud. “This is a mind-boggling number,” he said. “They estimate the cost of healthcare fraud to be $30 billion a year.”
“Healthcare fraud is not benign,” he said. “It’s a serious problem for businesses. The ones that are proactive and understand the issues are going to be better off. Do yourself and your company a favor and make sure you address problems when they come up.”