Undercover: How I Went from Company Man to FBI Spy--And Exposed the Worst Healthcare Fraud in U.S. History

By John W. Schilling | Go to book overview

CHAPTER FOURTEEN
The Health Care Financing
Administration

Many healthcare trade publications published stories focusing on alleged cost reporting fraud in January 1999, partly because of the lawsuits filed by Jim Alderson and me and the growing government scrutiny into Medicare cost reports. Some articles offered advice ranging from the importance of compliance to the dos and don'ts of cost reporting. The issue, while not quite yet mainstream, was front-page news in the healthcare world.

At work, I tried to incorporate my inside knowledge of reserve cost reports to fiscal intermediary policies. Columbia/HCA had declared that reserve cost reports were commonly accepted practices throughout the hospital industry, so it made sense for FIs such as UGS to request and review the appropriateness of reserves maintained by all providers. After all, the entire government investigation into allegedly fraudulent business practices at Columbia/HCA began with reserve cost reports.

Initially, my fraud department manager and I attempted to enlist the cooperation of United Government Services' provider audit department. The department quickly rejected our request, though, claiming that since all providers prepared reserves, requests to review them would prove too labor intensive. Baffled by this curiously inadequate response, I asked the department to address the issue at an upcoming technical conference that included other fiscal intermediaries. At that conference, representatives of other FIs also expressed their trepidation about requesting reserve cost reports.

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