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At the start of the new millennium, Americans were spending 1.3 trillion dollars each year on healthcare; anyone with a proper understanding of human nature recognizes that, when that much money is at stake, the unethical among us seek their personal benefit at the cost of those around them. The IRS estimates that between 3 and 10% of healthcare costs may be fraudulent. Even at minimum, that's an absolutely paralyzing $39 billion lost, including over $13 million in Medicare payments-yearly.
Obviously, something should be done. And yet, as so often happens, federal investigators and prosecutors typically rely on a heavy and injudicious hand-rather than a consistent one-when it comes to stanching the flow of money lost to healthcare fraud. The strategy appears to be to make examples of individuals, rather than bring about systemic change, which would be inconvenient and difficult.
Statistical data bears this out. According to government statistics, a mere 466 investigations of healthcare fraud were undertaken between 2005 and 2007, with only 203 cases actually resulting in sentencing. Investigation and prosecution of fraud cases is certainly a complex field, but it seems obvious that a $39 billion dollar problem can't be caused by a mere 50-60 people each year.
The same human nature that leads to healthcare fraud leads investigators and prosecutors to cut corners, attempting to solve a legitimate problem with minimal effort and personal expenditure. The problem lies in the fact that, when the focal point become individual prosecution rather than systemic change, it's entirely possible for the innocent to be greatly inconvenienced, falsely accused, or even wrongfully convicted.
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