FILE COpy

P HIE  PHYSICIANS' 
P RO 
J Y  of 
RECEIPT of 
FEDERAL, PA YMENTS 
.' OFFICE OF I'NSPECTOR GENERAL

OFF ICE OF. ANALYSIS AND INSPECTIONS 
OCTOBER 1986
 Offiee of the Inspector General

The mission of the Office of the Inspector General 

(OIG) is to

effectiveness and integri ty of 
tin'r tohmeot .e the eff iciency,  programs
Uni ted Stat'es Department of Health and Human Services
(HHS). It does this by developing methods to detect and prevent

fraud, waste and abuse. 
Created by statute in 1976, the
tnspector General keeps both the Secretary and the Congress fully

and currently informed about programs or management problems and

recommends correcti ve action. The 
erforms its mission by
conducting audits, investigations anOIGd  inspections with

approximately 1, 
200 staff strategically loc 
ted around the
country. 
Office of Analysis and Inspections

This report is produced by the Office of Analysis and Inspections 
(OAI), one of the three major offiees within the OIG. 
two are the  The other
Off ice of Audi t and the Off ice of Inves tigations .
OAI conducts inspections which are 
typically, short-term studies

signed to determine program effect1ve 
es$, efficieney and

vulnerabi Ii ty to fraud or abuse.

This Report

Enti tIed 
" Propr iety of Physicians ' Receipt of Federal Payments,
this study was conducted to determine whether the Social Security 
administrative structure and Social Security benefits were 
vulnerable to abuse by certain problem physicians. 
The report was prepared by the Regional Inspector 
General, Office

of Analysis and Inspections, Region VI and the Office of Analysis

and Inspections Social Security Branch 
 PROPRIETY OF PHYSICIANS' 
FEDER 
RECEIPT OF  PAYMENTS 
RICHAD P. KUSSEROW  DATE OF INSPECTION

INSPECTOR GENER  OCTOBER 19 86

OAI-06-86-00067  =,
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EXECUTIVE SUMMY 
The Inspector General began this study after discovering a 
physician barred from the Medicare program had obtained Social 
Security disability benefits based upon false medical evidence. 
The purpose of the study was to determine whether the Social 
Securi ty Administration I  (SSA) administrative structure, and Social 
Security benefits, were vulnerable to fraud or abuse by physicians
wi th  known or suspected problems. (These physicians were those 
barred from the Medicare program, in default on Health and Human 
Services loans, or identified by the U.S. Postal Service as 
having suspect medical credentials.  The study was completed by 
reviewing all active SSA disability cases from the problem 
physicians, reviewing employment records of the Social Security 
(DDS) 
Administration and State Disability Determination Service 
offices in the region assigned to this study, and by reviewing 
DDS records to determine if problem physicians were engaged in 
providing consultative examinations. 
We are pleased that our study surfaced no major problems.

The Social Security Administration is providing State DDS

offices information on debarred physicians, and Disability

Determination Service offices are using the listings to

screen candidates for consultant services. None of the

physicians were employed by the Social Security

Administration or by the State DDS offices.

We did find one physician in loan default and with an

indirect role in the Disability Determination Service

consultative process. The physician was one of many

physicians employed by a clinic providing consultative

services. 
The review of disability files on problem physicians did not

surface additional fraud. 
We recommend that the State Disability Determination Service 
offices carefully review medical evidence submitted on behalf 
entitlement. 
of debarred physicians to prevent fraudulent  TABLE OF CONTENTS 
PAGE 
EXECUTIVE  SUMMY 
PURPOSE 
BACKGROUND 
METHODOLOGY 
FINDINGS 
CONCLUSION 
3-4 
RECOMMNDATIONS 
i i
 I RECEIPT OF FEDERA PAYMENTS 
PROPRIETY OF PHYSICIANS 
PURPOSE 
The purpose of this inspection was to determine the
vulnerabili ty of Health and Human Services (HHS) programs 
to physicians who are known abusers of the Medicare or
Medicaid programs. 
either:
For this inspection, abusers are defined as 

physicians debarred for Medicare and or Medicaid

violations 
individuals identified by the U. S. Postal Service as

having suspect medical credentials 

physicians who are in default on loans from the

Department. 
II. 
BACKGROUND
(SSA) relies heavily on

The Social Security Administration 
preexisting medical evidence and consultative examinations

purchased from physicians by the State Disability

Determination Service (DDS) in determining a claimant'
eligibili ty for  In one 
payments as a disabled individual. 
known instance, this determination had been made on the 
basis of the claimant' s submission of falsified medical 
This 
records attesting to a nonexisting disability. 
claimant was a physician who had also been found to have 
commi tted criminal violations in the Medicare program. 
Medical practitioners who engaged in criminal or abusive 
practices in the Medicare or Medicaid programs may be 
sanctioned by the Secretary of HHS from future
participation in those programs. The Office of Inspector 
General periodically informs SSA of physicians who have 
been sanctioned and who should be precluded from serving as 
DDS. 
a staff or consultant physician for the State 
Although not previously explored, this same preclusion

S. Postal

could apply to individuals identified by the U.
Service as having suspect medical credentials as well as to

those physicians who have defaulted on education loans from

the Department.

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III. 
METHODOLOGY
Records of sanctioned physicians through December 1984 and

indi viduals with suspect medical credentials were compared 
to SSA' s Master Beneficiary Record and Supplemental

Security Record to identify those receiving payments as

disabled individuals. The disability claim folders were

then reviewed to identify any with suspect medical
evidence. 
For purposes of this inspection, suspect medical 
evidence is defined as: 
evidence that originates from a single treating

physician that is unsupported by other preexisting or

subsequently obtained medical evidence, such as a

consultative examination~ or

evidence that is clearly in contradiction with other

file. 
medical evidence in 
In a second phase of this inspection, these same records, 
plus those pertaining to physicians who had defaulted on HHS 
loans, were compared to DDS records in the five States 
comprising the Dallas region to determine if any abuser was 
serving on the staff or as a consultant examiner for the
DDS. This latter review was limited to the Dallas region 
because the State records needed for this review were only 
available in a paper format requiring a labor intensive 
manual records check. 
IV.  FINDINGS 
This inspection revealed:

A. Abuser Receipt of Disability Payments

Of the 190 debarred physicians, 16 had applied for

disability benefits. 
Six of these were denied and two 
died shortly after entitlement. Of the remaining eight 
cases, only the case that led to the initiation of this 
inspection involved the receipt of payments under 
fraudulent circumstances. No new cases involving 
suspect medical evidence were discovered. 
Only two of the 165 individuals with suspect medical

credentials received disability payments. Neither of 
these involved suspicious circumstances.

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 B. Abuser Involvement in the Disability Determination

Process 
The DDS in the five States comprising the Dallas region 
were free of any significant involvement by the abusers. 
None of the known abusers were working on the staff of 
examiners. In only one 
the DDS or as consultative 
instance was a physician who had defaulted on an HHS 
loan di scovered to have a connection wi th a 
educa tion 
State DDS. This connection was rather remote, in that 
the physician was employed by a clinic performing 
consultant examinations for the Louisiana State DDS. 
CONCLUSION 
Based on our review in the Dallas region no additional

actions, beyond those currently in place, appear necessary

to exclude abusers from the disability determination

process. However, since thi s review was limited to the 
Dallas region DDS' s, we cannot say with assurance that

these results apply nationally.

Al though no new cases of fraudulent disability payments 
were discovered among the 190 debarred physicians, the 
instant case that led to this inspection demonstrates that 
the disability determination process is vulnerable to 
manipulation by unscrupulous physicians. Physicians, by 
experience, can readily 
virtue of their knowledge and 
fabricate convincing evidence of a nonexistent medical 
condition that will (as in the instant case) satisfy SSA' 
requirements for a favorable disability determination. 
Though all medical doctors pose some degree of risk in
si tuations where the disability determination is based on a 
single source of medical evidence, the sanctioned 
physicians would seem to pose the greatest risk since they 
have evidenced a diminished credibility through their 
actions to defraud the Medicare and Medicaid programs. 
VI.  RECOMMNDATIONS 
should: 
The Commissioner of Social Security 
A. Remind State Disability Determination Services (DDS) to

exclude sanctioned physicians from the disability

determination process. 
I s should
Distributing copies of this report to the DDS 

highlight the need for continued vigilance in excluding

the sanctioned physicians from the consultative

examination or staff medical consultant positions.

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 B. Use the listings of sanctioned physicians to screen 
evidence. 
physician claimants for suspect medical 
Instruct the State DDS' s to use the listings of

sanctioned physicians generated by the Office of 
Inspector General to identify those who are applying for

disability benefits and to stringently review the

medical evidence submitted in connection with such

claims. 
Consultative examinations should be requested 
in cases where conflicting medical evidence has been 
provided or the only evidence establishing the

source. 
disabili ty originated from a single 
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