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Holder, Sebelius Tout New Tools At Health Fraud Summit

Attorney General Eric Holder and Human Services Secretary Kathleen Sebelius convened at a day-long summit to discuss ways to prevent fraud in the health care system.

The Obama administration is adopting tools that banks, credit card companies and insurance investigators use, in this case, to predict who is a legitimate home health agency or medical equipment vendor and who is not.

The Department of Health and Human Services is seeking bids for “predictive modeling” software it hopes to put in use across the country next year. Sebelius said this will institutionalize a significant change in strategy.

"We spot a problem, stop the claim before it is paid, go after the perpetrators and it really shifts us from the old days of 'pay and chase,' where the claims went out for months and sometimes, years later, we would try to track down the bad guys and recover those funds," Sebelius said.

Sebelius said tougher penalties established in the new health care law will also help the administration cut down on Medicare and Medicaid fraud.

Waste and fraud cost Medicare and Medicaid an estimated $54 billion in 2009, including elaborate schemes by fraudsters peddling everything from wheelchairs to hospice care.

Earlier this year, President Obama announced a nationwide series of regional summits as part of an expanded effort to crack down on Medicare fraud. Summits have already taken place in Miami, Los Angeles and New York City.

This program aired on December 16, 2010. The audio for this program is not available.

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