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Enforcement Trends: Investment Return on Fraud Fighting Continues to Decline

by | Jul 22, 2019

From - National Intelligence Report Although it's still a profitable endeavor, enforcing federal health care fraud laws isn't providing the investment returns of yesteryears… . . . read more

Although it's still a profitable endeavor, enforcing federal health care fraud laws isn't providing the investment returns of yesteryears. That's the main takeaway of the new joint HHS and DOJ report on the financial performance of the Health Care Fraud and Abuse Control Program (Program) during fiscal year 2018.

ROI Keeps Trending Down

Arguably, the most significant metric in the report is the Program's return on investment (ROI). Continuing recent trends, ROI for FY 2018 dipped to $4.00 for every dollar spent, as compared to $4.20 in FY 2017. That's the sixth annual decline in a row since Program ROI peaked at $8.10 in FY 2013.

Annual Program ROI, FY 2013 to FY 2018
FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018
$8.10 $7.70 $6.10 $5.00 $4.20 $4.00

"Because the annual ROI can vary from year to year depending on the number and type of cases that are settled or adjudicated during that year, DOJ and HHS use a three-year rolling average ROI for results contained in the report," the agencies explain in their report. But while rolling averages may take off some of the edge for a particular year, they can't conceal the long-term trend. Simply put, the return on enforcement dollars is only about 50% of what it used to be just six years ago.

By The Numbers

Total recoveries from health care fraud judgements and settlements topped $2.3 billion in FY 2018, slightly down from the previous year. The chart below summarizes the key year-to-year findings.

Metric FY 2018 FY 2017
Total recoveries $2.3 billion $2.4 billion
New DOJ criminal health care fraud investigations 1,139 967
New DOJ civil health care fraud investigations 918 948
New criminal cases filed 572 439
Convictions 872 639
Criminal actions resulting from OIG investigations 679 788
Exclusions issued by OIG 2,712 3,244

While these accomplishments are noteworthy, they come at a higher price than in recent years.

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