[Congressional Record Volume 156, Number 128 (Wednesday, September 22, 2010)]
[House]
[Pages H6837-H6839]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STRENGTHENING MEDICARE ANTI-FRAUD MEASURES ACT OF 2010
Mr. PALLONE. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 6130) to amend title XI of the Social Security Act to expand
the permissive exclusion from participation in Federal health care
programs to individuals and entities affiliated with sanctioned
entities, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 6130
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Strengthening Medicare Anti-
Fraud Measures Act of 2010''.
SEC. 2. PERMISSIVE EXCLUSION FROM FEDERAL HEALTH CARE
PROGRAMS EXPANDED TO INDIVIDUALS AND ENTITIES
AFFILIATED WITH SANCTIONED ENTITIES.
Section 1128(b)(15) of the Social Security Act (42 U.S.C.
1320a-7(b)(15)) is amended to read as follows:
``(15) Individuals or entities affiliated with a sanctioned
entity.--(A) Any of the following:
``(i) Any individual who--
``(I) is a person with an ownership or control interest (as
defined in section 1124(a)(3)) in a sanctioned entity or an
affiliated entity of such sanctioned entity (or was a person
with such an interest at the time of any of the conduct that
formed a basis for the conviction or exclusion described in
subparagraph (B)); and
``(II) knows or should know (as defined in section
1128A(i)(7)) (or knew or should have known) of such conduct.
``(ii) Any individual who is an officer or managing
employee (as defined in section 1126(b)) of a sanctioned
entity or affiliated entity of such sanctioned entity (or was
such an officer or managing employee at the time of any of
the conduct that formed a basis for the conviction or
exclusion described in subparagraph (B)).
``(iii) Any affiliated entity of a sanctioned entity.
``(B) For purposes of this paragraph, the term `sanctioned
entity' means an entity--
``(i) that has been convicted of any offense described in
subsection (a) or in paragraph (1), (2), or (3) of this
subsection; or
``(ii) that has been excluded from participation under a
program under title XVIII or under a State health care
program.
``(C)(i) For purposes of this paragraph, the term
`affiliated entity' means, with respect to a sanctioned
entity--
``(I) an entity affiliated with such sanctioned entity; and
``(II) an entity that was so affiliated at the time of any
of the conduct that formed the basis for the conviction or
exclusion described in subparagraph (B).
``(ii) For purposes of clause (i), an entity shall be
treated as affiliated with another entity if--
``(I) one of the entities is a person with an ownership or
control interest (as defined in section 1124(a)(3)) in the
other entity (or had such an interest at the time of any of
the conduct that formed a basis for the conviction or
exclusion described in subparagraph (B));
``(II) there is a person with an ownership or control
interest (as defined in section 1124(a)(3)) in both entities
(or had such an interest at the time of any of the conduct
that formed a basis for the conviction or exclusion described
in subparagraph (B)); or
``(III) there is a person who is an officer or managing
employee (as defined in section 1126(b)) of both entities (or
was such an officer or managing employee at the time of any
of the conduct that formed a basis for the conviction or
exclusion described in subparagraph (B)).''.
SEC. 3. BUDGETARY EFFECTS OF PAYGO LEGISLATION.
The budgetary effects of this Act, for the purpose of
complying with the Statutory Pay-As-You-Go Act of 2010, shall
be determined by reference to the latest statement titled
``Budgetary Effects of PAYGO Legislation'' for this Act,
submitted for printing in the Congressional Record by the
Chairman of the House Budget Committee, provided that such
statement has been submitted prior to the vote on passage.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from New
Jersey (Mr. Pallone) and the gentleman from Kentucky (Mr. Whitfield)
each will control 20 minutes.
The Chair recognizes the gentleman from New Jersey.
General Leave
Mr. PALLONE. Mr. Speaker, I ask unanimous consent that all Members
may have 5 legislative days in which to revise and extend their remarks
and include extraneous material in the Record.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from New Jersey?
There was no objection.
Mr. PALLONE. Mr. Speaker, I yield myself such time as I may consume.
[[Page H6838]]
Mr. Speaker, I rise today in strong support of H.R. 6130. The
legislation expands the authority of the Health and Human Services
Office of Inspector General to allow it to ban corporate executives
from doing business with Medicare if their companies were convicted of
fraud. It also gives the inspector general the ability to exclude
parent companies that may be committing fraud through shell companies.
This important bill will close two loopholes in current law so that
criminal offenders who defraud our Nation's seniors will have to pay
for their crimes. Mr. Speaker, for every dollar put into the pockets of
criminals, a dollar is taken out of the system to provide much-needed
care to millions of Medicare patients, including two of our Nation's
most vulnerable populations--seniors and the disabled.
This morning, my subcommittee held a hearing on Medicare fraud in
which we talked about the many important provisions of the new health
care law that will assist CMS, the OIG, and the Justice Department in
identifying abusive suppliers and fraudulent billing practices. In that
hearing, we heard from the inspector general about how this bill will
help fight fraud by closing two remaining gaps.
The first gap allows an executive who has left the company being
charged with fraud by the time of conviction to continue to participate
in Federal health programs. This shortfall willingly permits these
criminals to move from one company to another and continue to steal
from Medicare seniors and taxpayers. H.R. 6130 would give the OIG the
authority to ban these executives from doing business with Medicare.
The second gap allows companies that engage in fraud who have set up
shell companies to insulate themselves from liability and get off scot-
free. Once these shell organizations dissolve, there is no real penalty
to the parent company. So H.R. 6130 would give the OIG the authority to
ban these parent companies from doing business with Medicare.
Mr. Speaker, all forms of fraud undermine the integrity of our public
health system, and I applaud my colleagues from the Ways and Means
Committee--particularly Mr. Stark--for working on this important
legislation.
I urge my colleagues to support this bill.
Mr. Speaker, I reserve the balance of my time.
Mr. WHITFIELD. Mr. Speaker, I rise today to support H.R. 6130, a
commonsense solution to combating fraud in Medicare. This legislation
will provide the Health and Human Services Office of the Inspector
General with tools to properly combat Medicare fraud.
First, it will close an important loophole in current law and give
the Office of the Inspector General additional authority to fight
fraud. Under current law, for example, if an executive leaves a company
before the company is convicted of Medicare fraud, that executive
cannot be barred from participating in Federal health programs. Under
current law, an executive intent on defrauding Medicare could simply
move from one company to another and continue to inequitably use
American taxpayers' money.
Second, this law will prevent companies from hiding behind corporate
shells. Some companies use shell companies to protect the parent
company from any liability. If the company is caught participating in
fraud, the shell could be dissolved, leaving the parent company fully
intact. Under this bill, the Office of Inspector General can exclude
parent companies when such punishment is merited.
I am glad that we are continuing to find ways to combat fraud in
Medicare because we know that health care costs are out of control. And
I might say, I am sure every Member had the same experiences that I did
when we were home over this recent 3-week work period in which people
were coming up asking all sorts of questions about the health care
reform bill, and we really do not know the answers to it because HHS is
basically going to be writing these regulations. And we are not going
to fully know the outcome of this legislation for many years to come,
which I think merits, once again, the importance of starting to have
oversight hearings to have some questions answered that the American
people are asking for.
{time} 1610
I would ask unanimous consent at this time to yield the balance of my
time to the gentleman from California (Mr. Herger).
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Kentucky?
There was no objection.
Mr. HERGER. I reserve the balance of my time.
Mr. PALLONE. Mr. Speaker, I ask unanimous consent that the gentleman
from California (Mr. Stark), the Health Subcommittee chair on the Ways
and Means Committee, control the remainder of the time on the majority
side.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from New Jersey?
There was no objection.
Mr. STARK. Mr. Speaker, I yield myself such time as I may consume and
rise in support of H.R. 6130, which strengthens the Medicare Anti-Fraud
Measures Act, as you have heard described here.
This bipartisan fraud and abuse-fighting legislation was co-authored
by our ranking member, Mr. Herger, and was cosponsored on our side of
the aisle by Mr. Lewis, who chairs the Oversight Subcommittee on Ways
and Means.
It was developed in a way that I think Congress should do more
legislation. It was a problem that was called to the attention of Mr.
Herger and myself, and we worked together with the Office of the
Inspector General and the Centers for Medicare and Medicaid and
expanded the authority to ban executives from companies who have been
convicted of fraud from the program.
As you have heard, many of those executives can come back and
repeatedly take money from the Medicare or Medicaid program to which
they're not entitled, and this would put an end to that. It expands the
permissive authority to exclude affiliates, and it sees that the funds
thereby go to the services that beneficiaries need. The bill has been
endorsed by AARP, which states that the bill would expand the authority
of the United States Health and Human Services to accomplish just that.
I want to thank my ranking member, Mr. Herger, and Mr. Lewis, for
cooperating on this. I think we have unanimous agreement that it's a
bill that's necessary, a bill that will reduce fraud and abuse, and a
bill that will aid the Medicare and Medicaid programs.
I reserve the balance of my time.
Mr. HERGER. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, there is broad agreement that more needs to be done to
combat waste, fraud, and abuse in Medicare. In fact, fraud is such an
issue in Medicare, that the chief counsel to the HHS Inspector General,
Lewis Morris, who testified before the Ways and Means Health
Subcommittee this summer, said, ``A lot of career criminals and
organized criminals have decided that building a Medicare fraud scam is
far safer than dealing in crack or dealing in stolen cars, and it's far
more lucrative. Right now, it's a good bet that you can take millions
from us, and chances are you're not going to get caught.''
Mr. Speaker, it's clear more must be done to ensure that taxpayer
dollars and seniors' premiums are being used wisely and efficiently.
That is why Chairman Stark and I authored the legislation before us
today, H.R. 6130, the Strengthening Medicare Anti-Fraud Measures Act.
When Mr. Morris testified at our subcommittee, he identified ways in
which the current law could be improved. This legislation seeks to
address those areas.
The bill makes two improvements to current law. First, it provides
authority to exclude from Federal health programs executives whose
companies have been convicted of fraud. The HHS Office of Inspector
General would be allowed to exclude executives who were in positions of
authority at the time the fraud was committed but subsequently left
those positions.
Because the current statute is written in the present tense, it only
punishes officers, managing employees, and owners at the exact time OIG
levels punishment. Therefore, the individual who was the CEO of a
company that engaged in criminal fraud can
[[Page H6839]]
evade Medicare penalties if he or she resigns before the company is
convicted. The ex-CEO is then free to take on jobs with other health
care entities and commit fraud all over again.
Under H.R. 6130, OIG could exclude the individuals who are
responsible corporate officials at the time fraud was being committed,
regardless of where they are employed later.
The second change this bill makes prevents companies that are
convicted of fraud from hiding behind corporate shells and evading
punishment. The bill does this by strengthening OIG's ability to impose
penalties on corporations affiliated with convicted entities, or to use
``permissive exclusion'' authority to exclude them from program
participation.
Currently, corporations that engage in health care fraud can resolve
the criminal case through a guilty plea of a non-operating subsidiary.
OIG's only remedy in such a case doesn't allow for any meaningful
punishment against the company that's actually behind the Medicare
fraud.
This legislation gives OIG the authority to exclude corporate parents
or other affiliates from the Medicare program so that OIG will be
better positioned to require significant changes at these companies
beyond the remedies that are generally required in civil cases. This
would provide a significant incentive to corporate parents to promote
compliance and police the activities within their corporate families.
With these additional tools, OIG will be better able to stop those
individuals who commit fraud but who have been able to stay one step
ahead of law enforcement, saving taxpayer dollars and protecting
seniors.
Medicare fraud is a crime that hurts senior citizens, law-abiding
health care providers, and every American who pays taxes.
I thank Chairman Stark for working with me on this legislation and
urge the support of my colleagues.
I reserve the balance of my time.
Mr. STARK. Mr. Speaker, at this time I would like to yield 2 minutes
to the gentleman from Georgia (Mr. Lewis), the distinguished chair of
our Oversight Subcommittee on Ways and Means, who, like Mr. Herger,
recognizes the seriousness of this problem and was helpful in our
hearings in calling attention to many of the problems.
Mr. LEWIS of Georgia. Mr. Speaker, I want to thank my friend, my
colleague, Chairman Stark, for yielding time.
Mr. Speaker, we as a Nation have a duty to provide the very best
health care to our seniors and our disabled brothers and sisters. For
them, Medicare is a blessing, a lifeline.
Each time someone steals money from Medicare, it weakens the public
trust, it hurts our seniors, and threatens the future of Medicare. We
must not, and we will not allow, criminals to rob Medicare. If you
defraud Medicare once, you will never, ever do it again.
CEOs who defraud Medicare should not be able to simply move to a
different company and continue to bill Medicare. Their companies should
not be able to hide behind corporate shells that rob Medicare. This
legislation will strengthen the anti-fraud laws and stop these bad
practices.
{time} 1620
I want to thank Mr. Herger and again the chairman of our Subcommittee
on Health, Chairman Stark, for working side by side with the Oversight
Subcommittee to end these abuses.
I ask all my colleagues on both sides of the aisle to support this
necessary bipartisan bill.
Mr. HERGER. In closing, I urge all Members to vote ``yes'' on H.R.
6130, and I yield back the balance of my time.
Mr. STARK. Mr. Speaker, I yield myself the balance of my time.
I want to thank my distinguished ranking member for his support and
work in bringing this bill to the floor, and thank the staff who have
worked on this bill; John Barket, who was a fellow in our subcommittee,
got it started. He has now moved to Health and Human Services, but I
wanted to recognize his leadership. I would like to thank Erik
Rasmussen and Dan Elling on Mr. Herger's staff for their work and help
in this area. And as always, Debbie Curtis and Hannah Neprash on my
subcommittee as well for their good work. And again to thank Mr. Herger
for joining with us to see that we bring an end to these bad practices.
I yield back the balance of my time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from New Jersey (Mr. Pallone) that the House suspend the
rules and pass the bill, H.R. 6130, as amended.
The question was taken; and (two-thirds being in the affirmative) the
rules were suspended and the bill, as amended, was passed.
A motion to reconsider was laid on the table.
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