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The home for VPR's coverage of health and health industry issues affecting the state of Vermont.

New Bill Would Cut Down On Medicaid Provider Fraud

Bob Kinzel
(From left:) Attorney General William Sorrell, Congressman Peter Welch and Human Services Agency Secretary Hal Cohen, discuss a plan that would cut down on Medicaid fraud by providers, using a newly created national clearinghouse.

State officials are enthusiastically supporting federal legislation that cracks down on Medicaid fraud.

Rep. Peter Welch is a lead sponsor of this bill. He says it's needed because millions of Americans have been added to the Medicaid program through the Affordable Care Act.

In Vermont, it's estimated that 30 percent of all adults and children now receive their health care through the expanded Medicaid program. The state program has a total budget of $1.2 billion.

Welch's bill creates a national clearinghouse to identify health care providers who have defrauded the program.

“This is intended to crack down effectively on a fraudulent actor,” Welch says, “who is caught in one state from being able to continue to perpetuate the fraud in another.”

For example, if a provider is convicted in Vermont, his or her name will go on a national database so that officials in other states can be aware of that person's illegal activity. Vermont officials will also be able to identify providers who have been convicted in other states.

Welch says he's been able to garner a lot of bi-partisan support for his bill.

“This is one of those areas where I can work with my Republican colleagues,” explains Welch. “A lot of them aren't in favor necessarily of the Medicaid program or Medicaid expansion. They’ve voted against Obamacare, but on the other hand they're with me rooting out fraud."

"This is intended to crack down effectively on a fraudulent actor, who is caught in one state from being to continue to perpetuate the fraud in another." - Rep. Peter Welch

Attorney General Bill Sorrell says the proposed law could also be used to help target drug companies that try to market their products for conditions other than the ones that they have been approved for.

"That's where you can get into billions of dollars nationally,” says Sorrell, “with Medicaid and Medicare paying way more for drugs than they should be paying, or for drugs that are not effective for the purposes for which they have been marketing."

Human Services Secretary Hal Cohen supports a provision in the legislation that requires states to foot the bill if they allow a discredited health care provider to do business in their state.

The legislation has been unanimously approved by the House Energy and Commerce Committee.

Welch is optimistic that the bill could be on the House floor in the coming weeks.

Bob Kinzel has been covering the Vermont Statehouse since 1981 — longer than any continuously serving member of the Legislature. With his wealth of institutional knowledge, he answers your questions on our series, "Ask Bob."
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