US Medicare Program: "How Medicare Became a Thieves' Bazaar with Florida as the Epicenter" - by Chris Parker

Florida Governor Rick Scott former CEO of  Columbia/HCA

Think of the Medicare program as a bank that never bothered to buy a safe. Everyone from HMOs to drug dealers have been caught robbing it time and time again, stealing the kind of money that makes the sequester look like pocket change. While the credit-card industry uses data-mining techniques to flag fraud within minutes, CMS has allowed the most obvious schemes to run for years, rarely the wiser.

"Washington has long bragged that Medicare only has a 2 percent administrative overhead," Brady says. "But with that, we've paid a steep price in far too much fraud."

Given how often such blatant thievery goes undetected, no one's sure how much fraud there really is. Conservative estimates place the bill at $100 billion annually. The more adventurous peg the figure closer to $300 billion — three times what the feds spend on education.

It has left federal health care little more than an unlocked home, where street punks and gangsters, doctors and even states walk right in and help themselves to whatever's inside.

Then there's Armen Kazarian, kingpin of Los Angeles' Armenian mob. The feds say his gang stole the identities of doctors and patients while setting up fake clinics across the country. They knew nothing of medicine, sending Medicare fake bills that showed eye doctors doing bladder tests, obstetricians testing for skin allergies and dermatologists billing for heart exams.

Warm weather attracts mold, mosquitoes and retirees with government benefits. So it's no surprise that Miami is the epicenter of health-care fraud.

Then there's the culture of fraud that stinks to the very head of Florida government.

During the 1990s, Republican governor Rick Scott was CEO of the hospital company Columbia/HCA. As the feds later discovered from the largest fraud case in Medicare history, the company seemed more organized-crime outfit than health-care provider.

Columbia billed for tests that weren't necessary or ordered, submitted false diagnoses to increase reimbursements, paid kickbacks to doctors for patient referrals and billed for home visits that people didn't qualify for or receive.

The smoking gun was the two sets of books Columbia kept. One detailed all Medicare submittals. The other noted which were fraudulent, allowing Columbia to keep enough reserves to pay penalties should it ever get caught. A whistleblower estimated that fraud alone accounted for more than one-third of the company's profits.

When the whip came down in 2003, Columbia settled for $2 billion in fines for "systematically defrauding federal health-care programs." Scott claimed ignorance, though it's hard to believe that a self-described hands-on executive wouldn't know where a third of his company's profits came from. He was eventually fired — but with the velvet landing accorded to disgraced CEOs.

Scott walked away with nearly $10 million in severance, stocks worth $300 million, and a $1 million-a-year consulting contract - and then he went into politics.

Read more: How Medicare Became a Thieves' Bazaar - News - Dallas - Dallas Observer