Interesting Problem

While reading a newspaper in Sydney I saw an interesting headline: "The $2bn health fraud" so of course I had to read the article.

I didn't want to copy paste so I'll paraphrase. The parts in quotation marks are taken directly from the article.

It turns out that doctors and dentists are skimming millions of dollars from a federal government medical program for chronically ill patients. "In an embarrassing federal spending bungle that has bled $2 billion from the struggling health system, investigators have uncovered systemic fraud in two programs." Those two programs are the "Chronic disease dental program" and the "Chronic disease program," which includes nine different professions.

Health care professionals in these areas are claiming government rebates for writing disease management plans or treating the chronically ill. "Medicare rebates are paid to GPs for drawing up the plans, which give patients up to $4250 worth of free treatments from dentists and five free visits with other health professionals." The doctors are getting rich by drafting needless plans and providing taxpayer-funded (that's right, I said taxpayer-funded) treatments to patients who should not qualify. Hmmmm, how could this happen in a government controlled system?

"The dental costs have blown out by 325 per cent to more than $800 million, while GPs who wrote chronic-disease management plans have earned $914 million since they were introduced in July 2005 - triple the forcast cost. The cost of the five 'free' visits... soaked up another $290 million, bringing the total bill to more than $2 billion."

"One whistleblower told...a doctor she worked for was writing plans for patients who arrived at the surgery in a Porsche." Can you believe it? A Porsche! If you can afford a Porsche, especially in Australia, you don't need "free" healthcare.

There was also a little chart showing how much the "free" healtcare is costing the taxpayers. The four year estimate for the dental program was $377m but the two year actual cost was $800m. The four year estimate for the chronic disease program was $247m but the four year actual cost was $745m. These are just two programs within the system. I wonder how much money is wasted on the whole system.

I seem to remember Obama claiming that one way he would pay for his healthcare monstrosity would be through cleaning up the waste, fraud, and abuse. Unfortunately, experience tells us that bureaucracies are fertile ground for fraud and the bigger the bureaucracy, the more fraud you'll find.

Now, I don't know exactly how the Australian healthcare system works but this could be a sign of things to come in the US.

Uploaded 03/30/2010
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