Stark, Herger vow to reintroduce Medicare fraud bill next year

The top Democrat and Republican on the Ways and Means's Health subcommittee vowed Thursday to reintroduce their bill closing loopholes in Medicare fraud prevention efforts.

The bill makes it harder for executives at companies that have defrauded Medicare to continue doing so. It also seeks to prevent companies from setting up shell companies to insulate themselves from liability.


The bill passed the House by voice vote but died in the Senate this week after anonymous Republicans placed a hold on the legislation.

"Congressman Herger looks forward to continue to combat Medicare fraud and abuse in the next Congress," said a spokesman for Rep. Wally Herger (R-Calif.). Herger, the ranking member on the subpanel, is widely expected to take over as chairman next year.

Rep. Pete Stark (D-Calif.), the current chairman, expressed outrage at the last-minute hold that prevented the bill from passing before Congress adjourned for the year on Wednesday.

"Fraudsters and crooks who bilk millions out of Medicare just received a Christmas present courtesy of anonymous Republican Senators," Stark said in  a statement.

The bill would empower the Health and Human Services Department's Office of Inspector General to bar executives from federal health programs if a company they worked for is convicted of fraud after the executive has left the company. Under current law, executives can only be excluded from Medicare if they're still with a company at the time of conviction, which can occur years after fraudulent activity begins.

The bill would also enable the OIG to exclude parent companies from the Medicare program. Under current law, criminal settlements sometimes result in the dissolution of shell organizations with "no real penalty to the parent company," according to Stark.