27 Pages Posted: 28 Jul 2010

Abstract

Health care fraud is all about the money. The United States spent an estimated $2.5 trillion on health care in 2009, with over $918 billion of that coming from the federal government. Under some estimates, up to 10 percent of that amount - no one quite knows for sure - might be lost to fraud. But the relationship between health care fraud and the U.S. health care system is far more complex than might first appear. Would-be “fraudsters” are not the only ones who respond to the financial incentives in the system. Due to the unique nature of the laws used to pursue health care fraud, both public and private prosecutors also follow the money in choosing their targets and both may share in the spoils of a successful prosecution. Perceptions about the money lost to health care fraud also have enormous influence on policymakers, as exemplified by the recent health care reform debate. In short, money may drive health care fraud, but not all roads lead in the same direction. This essay explores three different perspectives on the ways in which health care fraud “follows the money” - the would-be perpetrators of fraudulent schemes, the public and private prosecutors who pursue fraudulent activities, and the policymakers who work to prevent fraud and recapture lost funds for legitimate program purposes.