Department of Health and Human Services 
OFFICE OF 
INSPECTOR GENERAL 
Beneficiary Awareness of Medicare Fraud 
A Follow-up 
JANET REHNQUIST 
Inspector General 
NOVEMBER 2001 
OEI-09-00-00590  OFFICE OF INSPECTOR GENERAL 
The mission of the Office of Inspector General (OIG) mandated by Public Law 95-452, as 
amended by Public Law 100-504, is to protect the integrity of the Department of Health and 
Human Services programs as well as the health and welfare of beneficiaries served by them.  This 
statutory mission is carried out through a nationwide program of audits, investigations, 
inspections, sanctions, and fraud alerts.  The Inspector General informs the Secretary of program 
and management problems and recommends legislative, regulatory, and operational approaches to 
correct them. 
Office of Evaluation and Inspections 
The Office of Evaluation and Inspections (OEI) is one of several components of the Office of 
Inspector General.  It conducts short-term management and program evaluations (called 
inspections) that focus on issues of concern to the Department, the Congress, and the public.  The 
inspection reports provide findings and recommendations on the efficiency, vulnerability, and 
effectiveness of departmental programs. 
OEI's San Francisco Regional office prepared this report under the direction of Paul A. Gottlober, 
Regional Inspector General.  Principal OEI staff included: 
REGION IX  HEADQUARTERS

Pamela Minniear, Project Leader  Rada Spencer, Program Specialist

Robert Gibbons, Program Analyst

Camille Harper, Program Analyst

Christopher Tarbell, Program Analyst

We would like to acknowledge the following OEI staff for their assistance in this project: 
Natasha Besch, Region II
 Norman Han, Region I

Timothy Brady, Region IX 
 Russ Hereford, Region I

Cheryl Dotts, Region IX
 Steve Keenan, Region I

Tanaz Dutia, Region III
 John Molnar, Region II

China Eng, Region I
 Gerius Patterson, Region IV

Tina Fuchs, HQ
 Elander Phillips, Region VII

Nicole Gillette, Region II
 Thomas Purvis, Region IX

Aimee Golbitz, Region I
 Barbie Robinson, Region IX

Chris Gould, Region I
 Marco Villagrana, Region V

Joyce Greenleaf, Region I 
 Kristy Williams, Region IV

Vincent Greiber, Region II
 Steven Zerebecki, Region IX

Erin Guay, Region V
 Thomas Zimmermann, Region II

To obtain copies of this report, please call the San Francisco Regional Office at (415) 437-7900. 
Reports are also available on the World Wide Web at our home page address: 
http://www.hhs.gov/oig/oei/  E X E C U T I V E  S U M M A R Y  
PURPOSE 
To assess Medicare beneficiary knowledge and awareness of Medicare fraud and the 
impact of the Department of Health and Human Services outreach initiatives. 
BACKGROUND 
In 1998, the Office of Inspector General (OIG) surveyed Medicare beneficiaries about 
their knowledge and awareness of Medicare fraud.  The OIG found that beneficiaries 
believed that Medicare fraud was common, and it was their personal responsibility to 
report suspected cases of Medicare fraud.  Most beneficiaries said that they read their 
Medicare statements but had not received information on Medicare fraud.  Beneficiaries 
said that recognizing fraud was difficult.  Most were neither aware of agencies that were 
working to stop Medicare fraud nor were they aware of the OIGs fraud hotline. 
In 1999, the OIG outreach partners launched a nationwide campaign to educate 
beneficiaries about Medicare fraud.  The campaign set forth a three-step process for 
beneficiaries to follow if they suspected Medicare fraud.  Beneficiaries were told that, as a 
first step, they should clarify unusual Medicare charges with their health care provider.  If 
questions remained, beneficiaries were advised to contact their Medicare insurance 
company.  If they remained dissatisfied and suspected fraud, they were told to call the 
OIG hotline. 
Out of a random sample of 1,498, we completed surveys with 543 Medicare beneficiaries 
for a 36 percent response rate.  We compared their responses to data in the 1998 OIG 
report.  We also interviewed the OIG outreach partners. 
FINDINGS 
Beneficiary knowledge of Medicare fraud has increased since 1998.  Beneficiary 
knowledge of Medicare fraud has increased 15 percentage points in the past 3 years. 
Twenty-four percent of beneficiaries are aware of efforts to reduce fraud. 
Beneficiaries are aware of groups both inside and outside the federal government who are 
involved in efforts to reduce fraud. 
Most beneficiaries are still not aware that there is a toll-free number to report 
Medicare fraud.  In 1998, 86 percent of beneficiaries were not aware of the toll-free 
hotline for reporting Medicare fraud.  In 2001, 85 percent of beneficiaries remain 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
ii  unaware of the hotline, despite the fact that the toll-free number appears on their claim 
statements which most of them read. 
Younger, urban beneficiaries are more likely to recall receiving information on 
Medicare fraud.  Beneficiaries who live in rural areas and beneficiaries who are more 
than 75 years old reported receiving less information. 
Beneficiaries who receive information are more likely to know whom to contact if 
they encounter Medicare fraud.  Of beneficiaries who receive information on Medicare 
fraud, only 14 percent would not know whom to call if they encountered fraud. 
Despite receiving more information on fraud, key beneficiary attitudes have not 
changed.  Beneficiaries are still not optimistic about efforts to eliminate fraud.  Almost 50 
percent do not believe that Medicare fraud is easy to recognize. 
Almost one-half of the beneficiaries who think they have experienced Medicare 
fraud reported it.  As a first step, beneficiaries who suspect fraud most frequently 
contact their health care provider for clarification. 
Most beneficiaries regularly read their claim statements.  As in the 1998 survey, the 
vast majority of beneficiaries report that they always read their claim statements.  Those 
with poor vision, limited English skills, and lower incomes are less likely to read their 
statements. 
CONCLUSION 
Outreach activities which are designed to educate beneficiaries about Medicare fraud are 
meeting most of their goals.  Beneficiaries in 2001 are more knowledgeable about 
Medicare fraud and are significantly more likely to receive information about fraud than 
they were 3 years ago.  Further, beneficiaries are reporting suspected fraud using an 
approach consistent with the three-step process outlined in the Who Pays?  You 
Pay.campaign. 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
iiii  T A B L E  O F  C O N T E N T S  
PAGE

EXECUTIVE SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  i

INTRODUCTION  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

FINDINGS

Awareness of Fraud . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5

Receiving Information on Medicare Fraud  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Encountering and Reporting Potential Fraud  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8

Attitudes and Behaviors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

CONCLUSION  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  12

APPENDICES

A:  Baseline Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

B:  Confidence Intervals for Selected Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14

C:  Analysis of Respondents versus Non-Respondents  . . . . . . . . . . . . . . . . . . . . . . . . . 17

Beneficiary Awareness of Fraud  OEI-09-00-00590 
iiiiii
 I N T R O D U C T I O N  
PURPOSE 
To assess Medicare beneficiary knowledge and awareness of Medicare fraud and the 
impact of the Department of Health and Human Services outreach initiatives. 
BACKGROUND 
Addressing Medicare fraud is an important issue within the Department of Health and 
Human Services (HHS).  Medicare is vulnerable to fraud because of the large 
expenditures and administrative complexity of the program.  Recent legislation, HHS 
initiatives, and educational outreach efforts all have attempted to address and eliminate 
fraud. 
Studies have shown that Medicare beneficiaries need more education about fraud.  In a 
previous Office of Inspector General (OIG) report (Beneficiary Awareness of Fraud, 
OEI-12-97-00440), we found that only 23 percent of beneficiaries were knowledgeable 
about Medicare fraud and very few received information about it.  Recent health surveys 
found that consumers believe that health care fraud is rampant, but they do not know how 
they can prevent it.1 
This report addresses current Medicare enrollees level of awareness of Medicare fraud 
and compares it to previous levels which we reported in our 1998 report.  We also 
assessed the effects of the HHS educational outreach activities, specifically the Who 
Pays?  You Pay. campaign. 
Recent Legislative Initiatives 
In recent years, Congress enacted a number of laws to assist in the fight against health 
care fraud and abuse.  The 1996 Health Insurance Portability and Accountability Act 
(P. L. 104-191), also known as HIPAA, contains several provisions designed to address 
Medicare fraud and abuse.  One provision created the Health Care Fraud and Abuse 
Control Program which mandates the coordination of health care law enforcement at all 
levels, established a dedicated stream of funding for fighting fraud and abuse, and 
provided for the education of the health care industry on fraudulent health care practices. 
Two other provisions in HIPAA are the Medicare Integrity Program and the Incentive 
Program for Fraud and Abuse Information.  These provisions allow HHS to contract with 
eligible entities to promote program integrity. 
1American Association of Retired Persons, America Speaks Out on Health Care Fraud, 
consumer surveys for 1996, 1998, and 2000. 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
11  The Omnibus Consolidated Appropriations Act of 1997 (P. L. 104-208) directs the 
Administration on Aging to establish demonstration projects that use the skills of retired 
professionals to help prevent Medicare fraud and abuse.  These demonstration projects, 
commonly referred to as Harkin Grants, fund Health Care Anti-Fraud and Abuse 
Community Volunteer Projects which assist with the recruitment and training of 
volunteers and the implementation of community education activities. 
The Balanced Budget Act of 1997 (P. L. 105-33) includes several provisions to strengthen 
anti-fraud and abuse efforts and to improve Medicare program integrity.  Among other 
things, the Act requires the Health Care Financing Administration - now known as the 
Centers for Medicare & Medicaid Services (CMS) - to issue an annual notice to 
beneficiaries that: 
C  encourages beneficiaries to check their Medicare statements carefully for accuracy 
and report any errors by calling the OIG toll-free telephone number, 
C  informs beneficiaries of their right to request an itemized statement for Medicare 
items and services, and 
C  describes the program established under HIPAA to collect information on 
Medicare fraud and abuse. 
Moreover, effective January 1, 1998, the Balanced Budget Act of 1997 requires 
that all Medicare claim statements include the OIG toll-free telephone number for 
reporting information about waste, fraud, and abuse. 
HHS Efforts to Address Health Care Fraud 
In 1996, HHS launched a nationwide educational outreach initiative to help reduce the 
incidence of fraud and abuse in Medicare.  This initiative evolved into a public-private 
partnership among five groups:  the Administration on Aging, the Department of Justice, 
the CMS, the American Association of Retired Persons (AARP), and the OIG.  Activities 
included conducting a nationwide outreach campaign to educate beneficiaries and others 
about Medicare fraud and abuse, establishing a more user-friendly OIG hotline, and 
increasing collaboration with other agencies and organizations involved in fighting 
Medicare fraud. 
In February 1999, the outreach partners launched a nationwide campaign to educate, 
inform, and advise millions of Medicare beneficiaries about Medicare fraud and abuse. 
"Who Pays?  You Pay." campaign materials set forth a three-step process for beneficiaries 
to follow if they suspect Medicare fraud.  First, beneficiaries were told that they should 
clarify unusual or questionable Medicare charges with their health care provider.  Second, 
if questions remained, the beneficiaries were directed to contact their Medicare insurance 
company.  As a last resort, if beneficiaries were still dissatisfied and suspected fraud, they 
were directed to call the OIG hotline.  As part of the campaign, the partners developed a 
televised public service announcement featuring a dripping faucet which represented 
Medicare money that was being lost due to fraud, waste, and abuse. 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
22  The launch of the campaign incorporated a single-day training event attended by 
approximately 10,000 Medicare beneficiaries nationwide.  Thirty-one cities held a press 
conference with five interactive sites.  Medicare beneficiaries convened in cinemas, AARP 
Regional Offices, university auditoriums, and other locations in major metropolitan areas 
to view a national training program to learn how to detect Medicare fraud. 
AARP Studies on Health Care Fraud and Abuse 
The AARP has conducted three consumer telephone surveys in the last 5 years that were 
designed to assess public attitudes toward health care fraud.  The 1996, 1998, and 2000 
consumer surveys measured Americans understanding of and personal experiences with 
health care fraud and abuse.  Although the majority of respondents to all surveys believed 
that fraud was widespread in the health care industry, the prevalence of this attitude 
appears to be declining.  In 1996, 93 percent of respondents reported that health care 
fraud was either somewhat or extremely widespread.  Approximately 83 percent believed 
this in 1998 and 78 percent in 2000. 
Previous Office of Inspector General Study 
In 1998, the OIG published the results of a survey of Medicare beneficiaries which 
assessed their knowledge and awareness of Medicare fraud.  According to the survey: 
C  more than half of the beneficiaries believed that Medicare fraud was common; 
C  ninety-four percent believed that it was their personal responsibility to report 
suspected cases of Medicare fraud; 
C  seventy-four percent of beneficiaries always read their Medicare statements; 
C  most beneficiaries believed that recognizing fraud was difficult, and most have 
never received information on Medicare fraud; and 
C  most respondents were not aware of agencies working to stop Medicare fraud nor 
of the OIGs toll-free number. 
METHODOLOGY 
To achieve the objectives of our study, we compared beneficiaries current knowledge and 
attitudes about Medicare fraud in 2001 to baseline data in our 1998 report.  To ensure 
comparability with the baseline data, we duplicated, as closely as possible, the 
methodology used in the previous study. 
We selected a simple random sample of 1,500 Medicare beneficiaries from CMSs national 
enrollment database, as of October 28, 2000.  Two of the beneficiaries in our sample died 
prior to October 28, 2000, but their names had not been removed from the enrollment 
database.  We omitted these beneficiaries from our sample, which reduced the 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
33  size to 1,498. Our sample included beneficiaries enrolled in both Medicare fee-for-service

and managed care plans.2

We modified the telephone survey instrument used in our 1998 evaluation to eliminate

questions that were not relevant to the follow-up effort, and added others about the Who

Pays?  You Pay. campaign.  We used two methods for collecting data from the

beneficiaries in our study.  First, we obtained telephone numbers for 59 percent of the

1,498 beneficiaries in our sample.  We attempted to conduct telephone surveys with the

890 beneficiaries for whom we had telephone numbers.  Secondly, some of the

beneficiaries that we spoke with by telephone expressed a preference to receive the survey

by mail.  For those beneficiaries, as well as some others that we were unable to reach by

telephone, we designed and mailed written surveys.  In total, we mailed 

118 surveys. 

A total of 543 beneficiaries responded to our survey.  We were able to complete telephone

surveys with 485 respondents.  Of the 118 mailed surveys, 58 were completed and

returned.  Of those beneficiaries for whom we obtained telephone numbers, 

61 percent responded (543 out of 890).  Overall, our response rate was 36 percent 

(543 out of 1,498).  We completed data collection during March - May, 2001.

We also interviewed the campaign partners for background information.

Our review was conducted in accordance with the Quality Standards for Inspections

issued by the Presidents Council on Integrity and Efficiency.

2Beneficiaries who completed our survey self-selected the type of Medicare insurance in which 
they were enrolled. Survey respondents answered a few screening questions to guide them in their 
selection. The categories were fee-for-service or managed care. We did not distinguish among the various 
types of non-traditional Medicare insurance, such as Medicare+Choice or preferred provider organizations. 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
44  F I N D I N G S  
AWARENESS OF FRAUD 
Beneficiary knowledge of Medicare fraud has increased since 1998 
Since 1998, beneficiary knowledge3 of Medicare fraud has increased 15 percentage points. 
We found that 38 percent of beneficiaries are knowledgeable about Medicare fraud in 
2001, as compared to 23 percent of beneficiaries in 1998.  (See Appendix A for a 
comparison of baseline and other selected statistics.)  Our analysis of the data shows that 
this increase can be attributed largely to the increase in information beneficiaries have 
received about Medicare fraud. 
Twenty-four percent of beneficiaries are aware of efforts to reduce Medicare 
fraud 
Approximately one-quarter of the beneficiaries who answered the question, Are you 
aware of any efforts to reduce Medicare fraud? said they were aware of some efforts to 
fight fraud.  Beneficiaries are aware of both federal government and non-federal groups 
that are involved in efforts to reduce fraud.  Beneficiaries mentioned the OIG, CMS, 
AARP, and the insurance companies that process their Medicare claims. 
Informed beneficiaries and those enrolled in fee-for-service plans are more aware 
of efforts to reduce fraud 
Medicare beneficiaries who receive information about Medicare fraud are more likely to 
be aware of efforts to reduce fraud.  We categorized beneficiaries as having received 
information if they have attended any presentations, seen a public service announcement, 
heard of the Who Pays?  You Pay. campaign, or asked about or looked for information 
on Medicare fraud.  Approximately 37 percent of beneficiaries who recalled receiving 
information about Medicare fraud were aware of efforts to reduce it.  In contrast, only 16 
percent of beneficiaries who did not recall receiving information were aware of efforts to 
reduce fraud.  Informed beneficiaries are more aware of efforts to reduce Medicare fraud. 
Fee-for-service beneficiaries also are more aware of efforts to reduce Medicare fraud than 
managed care beneficiaries.  Twenty-seven percent of fee-for-service beneficiaries are 
aware of efforts to reduce fraud compared to 15 percent of managed care beneficiaries. 
3In our previous report, Beneficiary Awareness of Medicare Fraud (OEI-12-97-00440), 
knowledge was defined as having received information on how to recognize Medicare fraud, asked about or 
looked for information about Medicare fraud, or being aware of a toll free hotline to report Medicare fraud. 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
55  Most beneficiaries are still not aware of the toll-free hotline to report Medicare 
fraud 
Beneficiary awareness of the toll-free fraud reporting hotline has not increased.  In 1998, 
approximately 86 percent of beneficiaries were not aware of the toll-free hotline for 
reporting Medicare fraud.  In 2001, 85 percent of beneficiaries remain unaware of the 
hotline.  In 1998, Congress mandated that the OIG hotline number appear on all Medicare 
claim statements.  According to one hotline employee, although the number of calls to the 
hotline has increased since 1998, the number of beneficiary complaints about fraud 
actually has decreased.  Hotline calls increased, because the OIG hotline number is 
included on the claim statements.  Therefore, beneficiaries call with general inquiries, not 
just to report fraud. 
RECEIVING INFORMATION ON MEDICARE FRAUD 
Beneficiaries receive information about fraud from a variety of sources 
Approximately 45 percent of beneficiaries recalled receiving information about Medicare 
fraud.  Beneficiaries mentioned receiving information from more than 15 different sources, 
including governmental organizations such as CMS and their Social Security office. 
Consumer advocacy groups, such as AARP, also were cited, as well as general media 
outlets, such as the radio and the Internet.  One beneficiary said, I get notices from lots of 
groups all the time... 
Source: Office of Evaluation and Inspections, 2001 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
66  Some beneficiaries also report receiving information about Medicare fraud from theWho 
Pays?  You Pay. campaign.  Medicare beneficiaries receive campaign information 
through written brochures and pamphlets, the Internet, public service announcements, 
seniors citizens groups, and AARP. 
Both Medicare beneficiaries and campaign partners report that television is a particularly 
effective method for providing information to beneficiaries about Medicare fraud.  Of the 
beneficiaries who heard about the Who Pays? You Pay. campaign, 54 percent 
mentioned the television public service announcement as the source.  Similarly, more than 
half of the campaign partners specifically mentioned the public service announcement as 
particularly successful in reaching beneficiaries.  According to one partner, The Dripping 
Faucet announcement received lots of play and was pretty effective. 
Older beneficiaries and those who live in rural areas are less likely to report 
receiving information concerning Medicare fraud 
Older beneficiaries are significantly less likely to recall receiving information about 
Medicare fraud than younger beneficiaries.  Sixty percent of those beneficiaries under 
65 years of age report receiving information.  In contrast, 48 percent of beneficiaries who 
are between the ages of 65 and 75 report receiving information.  This figure decreases to 
40 percent for beneficiaries who are more than 75 years old. 
Source: Office of Evaluation and Inspections, 2001 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
77  Beneficiaries living in urban areas are more likely to recall receiving information than 
beneficiaries who live in rural communities.  Of beneficiaries who reside in urban4 areas, 
48 percent reported receiving information on fraud.  In contrast, only 34 percent of 
beneficiaries who live in rural5 areas report receiving information on fraud. 
Source: Office of Evaluation and Inspections, 2001 
ENCOUNTERING AND REPORTING POTENTIAL FRAUD 
Beneficiaries still experience potential Medicare fraud 
Approximately 11 percent of Medicare beneficiaries suspect that they have encountered 
Medicare fraud.  This proportion is smaller, though not significantly, than the 19 percent 
of beneficiaries who reported experiencing Medicare fraud in our 1998 survey. 
Beneficiaries experience potential Medicare fraud in many forms.  Approximately 
6 percent of beneficiaries report that they were billed for the same services or equipment 
more than once, while approximately 5 percent report that they were billed for services or 
equipment they did not receive.  Beneficiaries believe these were incidents of actual fraud 
and not errors resulting from honest mistakes.  For example, one Medicare beneficiary 
stated that he continues to receive monthly bills for a hand brace made after an earlier 
surgery, while another beneficiary reported that he was billed for a pacemaker that he did 
not receive.  After reviewing claim statements following a hospital discharge, one 
beneficiary realized that Medicare was billed for 2 extra days and medications that she did 
not receive.  When she questioned the hospital, the response was, You didnt have to 
pay. 
4 Urban is categorized as 50 percent or more of the county is urban, according to census data. 
5 Rural is categorized as 50 percent or less of the county is designated as rural by census data. 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
88  Beneficiaries also report that individuals other than their regular health care providers have 
offered them free medical equipment or services that would be billed to the Medicare 
program.  Approximately 10 percent have been offered free medical services, tests, or 
equipment.  Less than 1 percent of beneficiaries report that they actually have been sent 
equipment that was not ordered by their doctor. 
Beneficiaries who receive information are more likely to know whom to contact if 
they encounter Medicare fraud 
Only 14 percent of beneficiaries who recalled receiving information said they would not 
know whom to call if they encountered fraud.  Comparatively, approximately 22 percent 
of beneficiaries who have not received information about fraud said they did not know 
whom to call if they encountered fraud in the Medicare program.  Receiving information 
can increase beneficiary awareness of groups that might be able to help them with fraud. 
Some of the groups that beneficiaries report they would call include: 
Medicare Fraud Contacts 
Groups Mentioned  Percent Mentioned 
Medicare/CMS  27.8 percent 
Social Security Office  10.3 percent 
Person or facility that may have committed the 
8.6 percent 
fraud 
Insurance company that processes the claims  8.4 percent 
Phone number on Medicare Notice  4.2 percent 
OIG Hotline  2.5 percent 
Source: Office of Evaluation and Inspections, 2001 
ATTITUDES AND BEHAVIORS 
Despite receiving more information on fraud, key beneficiary attitudes have not 
changed 
Beneficiaries are still not optimistic about efforts to eliminate Medicare fraud.  In 1998, 
almost 17 percent of beneficiaries agreed with the statement, Its not worth the time and 
effort for me to report and pursue suspected health care fraud.  In 2001, approximately 
16 percent of beneficiaries agree with that statement.  As one respondent mentioned, I 
don't really follow my mom's health expenses too much because she is in a nursing home. 
I really just let them do it and assume that she is getting what she needs.  Besides, how am 
I going to stop fraud? 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
99  Medicare beneficiaries still do not believe that Medicare fraud is easy to recognize.  In 
1998, almost 50 percent of beneficiaries did not believe that Medicare fraud is easy to 
recognize.  Some beneficiaries mentioned that confusing Explanation of Medicare Benefits 
Notices and Medicare Summary Notices make it difficult for them to determine what was 
billed to Medicare.  According to one beneficiary:  ...you can't figure out what they're 
billing for.  I have no idea what the codes are; whether they're right or wrong, you'll never 
know.  To catch fraud, you need to know what the codes are.  The public's never going to 
know.  I have to assume the best. 
Approximately half of beneficiaries who think they have encountered Medicare 
fraud reported it 
Of those beneficiaries who think they have encountered fraud, approximately 48 percent

reported the incident.  Beneficiaries reported fraud in several ways.  Most often,

beneficiaries contacted the person or facility that submitted the Medicare claim for

clarification (39 percent) or the Medicare program directly (35 percent).  Beneficiaries

also reported suspected fraud to the insurance company that processes their Medicare

claims (13 percent) and to the Inspector Generals fraud hotline (9 percent).

However, beneficiaries mentioned several reasons why they hesitate to report Medicare

fraud: 

C  They want to be sure it is fraud.

C  Their doctor might get in trouble.

C  They are concerned about the repercussions that would follow if proven wrong.

C  They do not want to get anyone in trouble.

Most beneficiaries regularly read their claim statements 
In both 1998 and 2001, we found that most beneficiaries who receive Medicare claims 
statements report that they always read them.  In 1998, approximately 74 percent of 
beneficiaries always read their claim statements.  In 2001, approximately 80 percent of 
beneficiaries stated that they always read their claim statements.  Approximately 
47 percent of beneficiaries have someone else, such as a family member, friend, or 
professional, also read their Medicare statements. 
Beneficiaries with poor vision, limited English skills, lower incomes, and who are 
pessimistic about fraud are less likely to read their claim statements.  The frequency with 
which beneficiaries read their Medicare claim statements is directly associated with 
income, comfort with reading English, and visual ability.  Eighty-two percent of 
beneficiaries who earn more than $10,000 per year always read their claim statements. 
In contrast, 67 percent of beneficiaries who earn less than $10,000 annually stated that 
they always read their claim statements.  Sixty-six percent of beneficiaries who are less 
comfortable reading English report always reading their claim statements, whereas 
82 percent of beneficiaries who read English very well report always reading their claim 
statements.  Eighty-three percent of respondents who see very well report 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
1100  always reading their claim statements; in contrast with 72 percent of beneficiaries who 
do not see as well.  Finally, beneficiaries who agree with the statement Its not worth the 
time and effort for me to report and pursue suspected health care fraud are also less likely 
toalways read their claim statements. 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
1111  C O N C L U S I O N  
Outreach activities which are designed to educate beneficiaries about Medicare fraud are 
meeting most of their goals.  Beneficiaries in 2001 are more knowledgeable about 
Medicare fraud and are significantly more likely to receive information about fraud than 
they were 3 years ago.  Further, beneficiaries are reporting suspected fraud using an 
approach consistent with the three-step process outlined in the Who Pays?  You 
Pay.campaign. 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
1122  Appendix 
Baseline Statistics

The following table compares the point estimates and 95 percent confidence intervals for 
selected baseline statistics from our 1998 and 2001 surveys.  To mirror the methodology 
used in the 1998 report, in calculating the 2001 baseline statistics, we limited our analysis 
to include those beneficiaries who submitted at least one claim to a Medicare Part B 
carrier during 2000.  Additionally, we excluded those beneficiaries who were enrolled in 
managed care during 2000.  (n = 271). 
1998 Survey Results  2001 Survey Results  Results of t Test 
Baseline 
95 %  95% 
Statistic  Point  Point  Significant  P 
confidence  confidence 
Estimate  Estimate  at 95%?  value 
interval  interval 
Percent of Medicare 
beneficiaries who 
74%  69% - 79%  79%  75% - 84%  No  0.13 
always read their 
claim statements 
Percent of Medicare 
beneficiaries who 
23%  19% - 28%  38%  32% - 44%  Yes  <0.01 
are knowledgeable 
about fraud 
Percent of Medicare 
beneficiaries who 
are not aware of any 
88%  84% - 91%  72%  66% - 77%  Yes  <0.01 
agencies that work 
to reduce Medicare 
fraud 
Percent of 
beneficiaries who 
do not know there 
86%  82% - 89%  85%  81% - 89%  No  0.87 
is a toll-free hotline 
to report Medicare 
fraud 
Of Medicare 
beneficiaries who 
say they may have 
55%  40% - 69%  50%  31% - 69%  No  0.71 
encountered fraud, 
percent who 
reported it 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
1133  Appendix B 
Confidence Intervals for Selected Statistics

The following table show the point estimates and 95 percent confidence intervals for 
selected statistics in the order that they appear in the report. 
95 Percent 
Point 
Statistic  Confidence 
Estimate 
Interval 
Of beneficiaries who answered the question Are you 
aware of any efforts to reduce Medicare Fraud, percent  24%  20% - 27% 
who answered yes 
Of beneficiaries who received information on Medicare 
fraud, percent who answered yes to the question Are  37%  31% - 44% 
you aware of any efforts to reduce Medicare Fraud? 
Of fee-for-service beneficiaries, percent who are aware of 
27%  23% - 32% 
efforts to reduce Medicare fraud 
Of managed care beneficiaries, percent who are aware of 
15%  7% - 23% 
efforts to reduce Medicare fraud 
Of beneficiaries who did not receive information on 
Medicare fraud, percent who answered yes to the 
16%  11% - 20% 
question Are you aware of any efforts to reduce 
Medicare Fraud? 
Percent of beneficiaries who reported receiving 
45%  41% - 50% 
information about Medicare fraud 
Percent of beneficiaries who had heard of the Who 
Pays? You Pay. campaign on how to report Medicare  6%  4% - 9% 
fraud 
Of the beneficiaries who heard of the Who Pays? You 
Pay. campaign, percent who said they had also seen a  54%  37% - 72% 
television PSA about the campaign 
Percent of beneficiaries who suspect that they have 
11%  8% - 15% 
encountered Medicare fraud 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
1144  Appendix B 
95 Percent 
Point 
Statistic  Confidence 
Estimate 
Interval 
Percent of beneficiaries who report that Medicare was 
6%  4% - 8% 
billed twice for the same goods or services 
Percent of beneficiaries who report that Medicare was 
5%  3% - 7% 
billed for services or equipment they did not receive 
Percent of beneficiaries who were offered free medical 
10%  8% - 13% 
services, tests, or equipment 
Percent of beneficiaries who report that they were sent or 
0.2%  .04% -1.02% 
delivered equipment that was not ordered by their doctor 
Of beneficiaries who received information about 
Medicare fraud, percent who answered dont know to 
14%  10% - 18% 
the question Who would you contact if you experienced 
fraud while in the Medicare program? 
Of beneficiaries who did not receive information about 
Medicare fraud, percent who answered dont know to 
22%  17% - 27% 
the question Who would you contact if you experienced 
fraud while in the Medicare program? 
Percent of beneficiaries who agreed with the statement 
Its not worth the time and effort for me to report and  16%  11% - 20% 
pursue suspected health care fraud. 
Percent of beneficiaries who disagree with the statement 
49%  43% - 55% 
Medicare fraud is easy to recognize. 
Of beneficiaries who encountered suspected Medicare 
48%  34% - 62% 
fraud, percent who reported the incident 
Percent of beneficiaries who report that they always 
80%  76%-84% 
read their Medicare claim statements 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
1155  Appendix B 
95 Percent 
Point 
Statistic  Confidence 
Estimate 
Interval 
Percent of beneficiaries who report that someone else 
47%  42%-52% 
reads their Medicare claim statements 
Of beneficiaries earning less than $10,000, percent who 
67%  53%-80% 
report always reading their Medicare claim statements* 
Of beneficiaries earning more than $10,000, percent who 
82%  77% - 87% 
report always reading their claim statements* 
Of beneficiaries who read English very well, percent 
who report that they always read their Medicare claim  82%  78% - 87% 
statements* 
Of beneficiaries who do not read English very well, 
percent who report that they always read their  66%  54% - 78% 
Medicare claim statements* 
Of beneficiaries who see very well, percent who report 
83%  78% - 88% 
that they always read their Medicare claim statements* 
Of beneficiaries who do not see very well, percent who 
report that they always read their Medicare claim  72%  65% - 80% 
statements* 
Of beneficiaries who agree with statement, Its not 
worth the time and effort for me to report and pursue 
67%  55% - 79% 
suspected health care fraud, percent who always read 
their Medicare claim statements 
Of beneficiaries who disagree with statement, Its not 
worth the time and effort for me to report and pursue 
83%  79% - 87% 
suspected health care fraud, percent who always read 
their Medicare claim statements 
*  Of beneficiaries who answered the question 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
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 Appendix C 
Analysis of Respondents Versus Non-Respondents 

We compared survey respondents with survey non-respondents for five variables: 
(1) beneficiary age at the time of the interview, (2) race of the beneficiary, (3) gender of 
the beneficiary, (4) median income of local community, and (5) urban-rural residence.  We 
found that respondents are not different from non-respondents by gender or the urban-
rural character of the community.  However, respondents are different from 
non-respondents by age, race, and median area income.  To determine the effect of the 
relationship between response rate and age, race, and median income, we conducted an 
additional analysis of the baseline statistics listed in Appendix A.  In this analysis, we 
assumed that non-respondents would have answered the same as respondents within the 
same age, race, or median area income categories.  We then recalculated the baseline 
statistics.  We found that the results were all within the 95 percent confidence intervals of 
the original estimates.  Therefore, we did not find any statistical evidence of age, race, or 
median income bias because of non-response. 
Analysis by Age 
Respondents differed significantly from non-respondents by age.  The under-65 and 
85-and-older groups are under represented among the respondents, whereas the 75 to 
84 age group is over represented. 
Respondents versus Non-Respondents by Age Group 
Age  Respondents  Non-Respondents 
Under 65 years  10.9%  16.0% 
65 to 74 years  41.8%  38.6% 
75 to 84 years  37.9%  30.9% 
85 years and older  9.4%  14.5% 
The chi-square for respondents versus non-respondents by age group is statistically 
significant: 
chi-square = 19.533  degrees of freedom = 3  probability = .0002 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
1177  Appendix C 
Analysis by Race 
Respondents differed significantly from non-respondents by race.  As shown in the table 
below, beneficiaries who were white were over-represented among respondents. 
Respondents versus Non-Respondents by Race 
Race  Respondents  Non-Respondents 
White  89.3%  80.7% 
Other  10.7%  19.3% 
Chi-square for respondents versus non-respondents by race is statistically significant: 
chi-square = 19.0535  degrees of freedom = 1  probability < .0001 
Analysis by Median Area Income 
Respondents differed significantly from non-respondents in the median income of the zip 
code of residence.  As shown in the table, respondents lived within zip codes with a higher 
median income than non-respondents. 
Respondents versus Non-Respondents by Median Income 
Median Income  Respondents  Non-Respondents 
Median zip code income  $31,470  $30,049 
(standard error)  ($509.06)  ($390.64) 
T-test for respondents versus non-respondents by median zip code income is statistically 
significant at the 95 percent confidence level: 
t= -2.21  degrees of freedom =1364  probability ># t# = .0270 
Beneficiary Awareness of Fraud  OEI-09-00-00590 
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