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Detecting Medicare Abuse

  • David Becker
  • Daniel Kessler
  • Mark McClellan
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    This paper identifies which types of patients and hospitals have abusive Medicare billings that are responsive to law enforcement. For a 20 percent random sample of elderly Medicare beneficiaries hospitalized from 1994-98 with one or more of six illnesses that are prone to abuse, we obtain longitudinal claims data linked with Social Security death records, hospital characteristics, and state/year-level anti-fraud enforcement efforts. We show that increased enforcement leads certain types of types of patients and hospitals to have lower billings, without adverse consequences for patients' health outcomes.

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    File URL: http://www.nber.org/papers/w10677.pdf
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    Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 10677.

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    Date of creation: Aug 2004
    Date of revision:
    Publication status: published as Becker, David, Daniel Kessler and Mark McClellan. "Detecting Medicare Abuse," Journal of Health Economics, 2005, v24(1,Jan), 189-210.
    Handle: RePEc:nbr:nberwo:10677
    Note: HE
    Contact details of provider: Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.
    Phone: 617-868-3900
    Web page: http://www.nber.org
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    1. Andreoni, J. & Erard, B. & Feinstein, J., 1996. "Tax Compliance," Working papers 9610, Wisconsin Madison - Social Systems.
    2. Rose-Ackerman, Susan, 1975. "The economics of corruption," Journal of Public Economics, Elsevier, vol. 4(2), pages 187-203, February.
    3. Daniel P. Kessler & Mark B. McClellan, 2002. "The Effects of Hospital Ownership on Medical Productivity," RAND Journal of Economics, The RAND Corporation, vol. 33(3), pages 488-506, Autumn.
    4. Mark Duggan & Steven D. Levitt, 2002. "Winning Isn't Everything: Corruption in Sumo Wrestling," American Economic Review, American Economic Association, vol. 92(5), pages 1594-1605, December.
    5. Porter, Robert H & Zona, J Douglas, 1993. "Detection of Bid Rigging in Procurement Auctions," Journal of Political Economy, University of Chicago Press, vol. 101(3), pages 518-38, June.
    6. Elaine Silverman & Jonathan Skinner, 2001. "Are For-Profit Hospitals Really Different? Medicare Upcoding and Market Structure," NBER Working Papers 8133, National Bureau of Economic Research, Inc.
    7. Dwayne Banks & Elliott Parker & Jeanne Wendel, 2001. "Strategic interaction among hospitals and nursing facilities: the efficiency effects of payment systems and vertical integration," Health Economics, John Wiley & Sons, Ltd., vol. 10(2), pages 119-134.
    8. Eduardo Engel & Alexander Galetovic & Claudio Raddatz, 1999. "A Note on Enforcement Spending and Vat Revenues," Documentos de Trabajo 52, Centro de Economía Aplicada, Universidad de Chile.
    9. Robinson, James C, 1996. "Administered Pricing and Vertical Integration in the Hospital Industry," Journal of Law and Economics, University of Chicago Press, vol. 39(1), pages 357-78, April.
    10. Mauro, Paolo, 1995. "Corruption and Growth," The Quarterly Journal of Economics, MIT Press, vol. 110(3), pages 681-712, August.
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