MU Docs Suspected of Medicare Fraud--Par for the Course in the Reform Era?

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Radiologists Kenneth Rall and Michael Richards were terminated from the Missouri University Health System today after a yearlong internal investigation revealed that they had committed Medicare fraud.

According to the Columbia Daily Tribune, the pair was endorsing Medicare claims for imaging second reads that only had been done by residents, and collecting reimbursement dollars for the same.

The scandal is also forcing the retirement of MU medical school dean Bob Churchill. Although Churchill was not suspected of any criminal activity in the matter, he re-hired Rall in 1998—12 years after the latter was indicted in a check-cashing and embezzlement scandal that never made it to trial.

Rall is the former radiology department chairman, and the 2011 Boone County Medical Society Doctor of the Year.

An article published today in the magazine Insurance Journal posits that greater fraud liability, such as that absorbed by MU, is inevitable amid the evolution of a reform-bound healthcare system, and that the insurance industry is ahead of the curve in detecting and reporting such issues.

“Managing reimbursements from both private and governmental (Medicare) has always been a challenge for healthcare organizations and practitioners, but now the coding and billing practices of such entities are coming under increased scrutiny…[and] that’s not likely to change even if part or all of the Patient Protection and Affordable Care Act (PPACA) is shot down.”

According to the article, the U.S. federal government will “continue to come down pretty hard on the medical community,” recovering “billions of dollars” every year thanks to greater scrutiny of such practices. In such an environment, organizations whose staff risk liabilities will need to take steps to protect themselves.

The MU Department of Radiology announced it will upgrade its security and verification policies around the handling of patient images as a result of the discovery. The health system says patient care was not compromised as a result of any suspected wrongdoing, and that the studies were necessary and had been read by qualified residents.