The federal investigation into the relationship between Democratic donor Dr. Salomon Melgen and Sen. Bob Menendez (D., N.J.) has exposed the rampant culture of Medicare and Medicaid fraud, which by some estimates cost taxpayers as much as $98 billion in fiscal year 2011.
The raid by the FBI and the Department of Health and Human Services (HHS) of Melgen’s eye center in Florida spanned two days in late January. The involvement of HHS indicated “the search-and-seizure raid has ties to a possible Medicare fraud inquiry,” the Miami Herald reported. The FBIreportedly went in after authorities spotted a shredding truck; boxes and bags of evidence were removed from Melgen’s office.
“Normally, federal searches of businesses occur during the day during normal business hours. The fact that this search began on Jan. 29 and lasted some thirty-plus hours and ended Jan. 30, tells us the scope of this search was major,” Ken Boehm, chairman and cofounder of the National Legal and Policy Center, said by email. “Also, the presence of crow bars and drills would seem to indicate that materials being sought were locked up. By any conventional yardstick, all of this activity tells us this is a very serious investigation.”
The exact scope of Medicare fraud in America is unknown. However, the GAO has long identified Medicare as a high-risk program, and it has issued frequent reports on identifying fraud and finding ways to help combat it.
The Obama administration recently touted its efforts in combating Medicare fraud, claiming in a release last week it had “record-breaking” recoveries of $4.2 billion for FY 2012 from individuals and companies who attempted to defraud Medicare and Medicaid.
However, while the numbers were impressive and reported by many media outlets, critics say such recovery figures are suspect.