Testimony of:  
Daniel R. Levinson  
Inspector General  
U.S. Department of Health & Human Services  
_________________________________________________________________________________ 
 
Good afternoon Chairman Obey, Ranking Member Tiahrt, and other distinguished Members of 
the Subcommittee.  I am Daniel Levinson, Inspector General for the U.S. Department of Health 
& Human Services (HHS).  I thank you for the opportunity to appear before you today to discuss 
the Office of Inspector Generals (OIG) efforts to combat health care fraud, waste, and abuse in 
Medicare and Medicaid.  I also thank you for your continued commitment to furthering our 
shared goal of safeguarding the fiscal integrity of these programs against those who would divert 
resources that are vital to so many Americans. 
 
Medicare and Medicaid fraud, waste, and abuse cost the taxpayers billions of dollars each year 
and put the programs beneficiaries health and welfare at risk.  The growing numbers of people 
served by these programs and the increased strain on Federal and State budgets caused by the 
economic recession further exacerbate the impact of these losses.  It is critical that we strengthen 
oversight of these essential programs and reduce their vulnerability to fraud, waste, and abuse. 
 
My testimony today will describe the nature and scope of the health care fraud, waste, and abuse 
that we have identified; strategies and recommendations to fight these problems; and OIGs role 
in fraud prevention, detection, and enforcement, including our highly productive collaboration 
with our colleagues in HHS and the Department of Justice (DOJ).  It will also describe how we 
have deployed our resources and the results we have achieved, as well as our plans for the new 
appropriations requested in the Presidents Budget for fiscal year (FY) 2011. 
 
OIGs Mission to Protect the Medicare and Medicaid Programs and Beneficiaries 
 
OIG fights health care fraud, waste, and abuse through a nationwide program of investigations, 
audits, evaluations, and enforcement and compliance activities.  Our FY 2010 appropriation 
included approximately $232 million in funding dedicated to protecting the integrity of Medicare 
and Medicaid.1  In recognition of the value and impact of OIGs oversight and enforcement 
activities, the Presidents Budget for FY 2011 requests approximately $272 million in Medicare 
and Medicaid integrity funding for OIG, a net increase of $40 million.  With this increased 
funding, OIG will expand its activities in support of the joint HHS-DOJ Health Care Fraud 
Prevention and Enforcement Action Team (known as HEAT and described in more detail 
below), including expanding the OIG-DOJ Medicare Fraud Strike Forces to 13 new locations. 
 
OIGs funding is used to hire and support investigators, auditors, evaluators, attorneys, and 
management and support staff to carry out our mission and functions.  OIG is comprised of more 
than 1,500 professionals who perform comprehensive oversight and enforcement activities for 
HHS programs, including: 
                                                 
1 OIGs total appropriation for FY 2010 was approximately $282 million, which also included $50 million to 
oversee the more than 300 other HHS programs. 
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House Appropriations Committee    Page 1 of 10 
Subcommittee on Labor, Health and Human Services, Education, and Related Agencies 
March 4, 2010                                                                                                     Office of Investigations:  conducts criminal, civil, and administrative investigations of health 
care fraud, which result in convictions, monetary recoveries, and exclusions of providers and 
suppliers from Federal health care programs; 
  Office of Audit Services: conducts and oversees audits of Medicare and Medicaid payments 
and operations, identifies improper payments and program vulnerabilities, and recommends 
audit disallowances and program improvements; 
  Office of Evaluation and Inspections:  conducts evaluations of the Medicare and Medicaid 
programs to identify program integrity vulnerabilities and make recommendations to prevent 
fraud, waste, and abuse and to promote economy, efficiency, and effectiveness; and 
  Office of Counsel to the Inspector General:  represents OIG in all civil and administrative 
fraud cases and, in connection with these cases, negotiates and monitors corporate integrity 
agreements; provides guidance to the health care industry to promote compliance; and 
provides legal support to OIG operations. 
 
OIGs program integrity activities are a sound investment.   
 
In FY 2009, OIG investigations resulted in $4 billion in settlements and court-ordered fines, 
penalties, and restitution, and in 671 criminal actions.  OIG audits resulted in almost $500 
million in receivables through recommended disallowances.  We also produced equally 
important but less quantifiable gains in deterrence and prevention of fraud, waste, and abuse.  
OIG has recommended numerous actions to address program integrity vulnerabilities.  For 
example, we found that Medicares average spending per beneficiary for inhalation drugs was 
five times higher in South Florida, an area rife with Medicare fraud, than in the rest of the 
country, and that a disproportionately high rate of these claims in South Florida exceeded the 
maximum dosage guidelines.  OIGs recommendations included adding new claims edits to 
prevent fraudulent or excessive payments, including edits to detect dosages exceeding coverage 
guidelines.  Many other recommendations to prevent and deter fraud, waste, and abuse are 
described in our annual Compendium of Unimplemented OIG Recommendations, the latest 
edition of which will be published later this month.   
 
OIG Work Highlighting the Nature and Scope of Health Care Fraud, Waste, and Abuse 
 
Fraud is a serious problem requiring a serious response. 
 
Although there is no precise measure of health care fraud, we know that it is a serious problem 
that demands an aggressive response.  We must not lose sight of the fact that the vast majority of 
health care providers are honest and well-intentioned; nonetheless, a small minority of providers 
intent on abusing the system can cost billions of dollars.  We believe that the $4 billion in 
settlements and court-ordered returns in FY 2009 resulting from OIG fraud investigations is just 
the tip of the iceberg.  More disturbing, even if the rate of fraud remains constant, as health care 
expenditures continue to rise, the financial impact of health care fraud will continue to increase. 
 
OIG investigations uncover a range of fraudulent activity.  Health care fraud schemes commonly 
include billing for services that were not provided or were not medically necessary, billing for a 
higher level of service than what was provided (upcoding), misreporting costs or other data to 
increase payments, paying kickbacks, and/or stealing providers or beneficiaries identities.  The 
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House Appropriations Committee    Page 2 of 10 
Subcommittee on Labor, Health and Human Services, Education, and Related Agencies 
March 4, 2010                                                                                                   perpetrators of these schemes range from street criminals, who believe it is safer and more 
profitable to steal from Medicare than trafficking in illegal drugs, to Fortune 500 companies that 
pay kickbacks to physicians in return for referrals.   
 
Many OIG investigations target fraud committed by criminals who masquerade as Medicare 
providers and suppliers but who do not provide legitimate services or products.  The rampant 
fraud among durable medical equipment (DME) suppliers in South Florida is a prime example.  
In these cases, our investigations have found that criminals set up sham DME storefronts to 
appear to be legitimate providers, fraudulently bill Medicare for millions of dollars, and then 
close up shop and reopen in a new location under a new name and repeat the fraud.  The 
criminals often pay kickbacks to physicians, nurses and even patients to recruit them as 
participants in the fraud scheme.     
 
The Medicare program is increasingly infiltrated by violent criminals, and our investigations are 
also finding an increase in sophisticated and organized criminal networks.  Some of these fraud 
schemes are viral, i.e., schemes are replicated rapidly within geographic and ethnic communities.  
Health care fraud also migrates  as law enforcement cracks down on a particular scheme, the 
criminals may shift the scheme (e.g., suppliers fraudulently billing for DME have shifted to 
fraudulent billing for home health services) or relocate to a new geographic area.  To combat this 
fraud, the Governments response must also be swift, agile, and organized. 
 
Health care fraud is not limited to this blatant fraud among sham providers.  Major corporations 
such as pharmaceutical and medical device manufacturers and institutions such as hospitals and 
nursing facilities have also committed fraud, sometimes on a grand scale.  OIG has a strong 
record of investigating these corporate and institutional frauds, which often involve complex 
billing frauds, kickbacks, accounting schemes, illegal marketing, and physician self-referral 
arrangements.  In addition, we are seeing an increase in quality of care cases involving 
allegations of substandard care.   
 
Waste and abuse cost taxpayers billions of dollars and must be addressed. 
 
Waste of funds and abuse of the health care programs also cost taxpayers billions of dollars.  In 
FY 2009, CMS estimated that overall, 7.8 percent of the Medicare fee-for-service claims it paid 
($24.1 billion) did not meet program requirements.  Although these improper payments do not 
necessarily involve fraud, the claims should not have been paid.  For our part, OIG reviews 
specific services, based on our assessments of risk, to identify improper payments.  For example, 
an OIG audit uncovered $275.3 million in improper Medicaid payments (Federal share) from 
2004 to 2006 for personal care services in New York City alone.  An OIG evaluation of 
payments for facet joint injections (a pain management treatment) found that 63 percent of these 
services allowed by Medicare in 2006 did not meet program requirements, resulting in $96 
million in improper payments.   
 
OIGs work has also repeatedly demonstrated that Medicare and Medicaid pay too much for 
certain services and products and that aligning payments with costs could produce substantial 
savings.  For example, OIG reported that Medicare reimbursed suppliers for pumps used to treat 
pressure ulcers and wounds based on a purchase price of more than $17,000, but that suppliers 
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House Appropriations Committee    Page 3 of 10 
Subcommittee on Labor, Health and Human Services, Education, and Related Agencies 
March 4, 2010                                                                                                   paid, on average, approximately $3,600 for new models of these pumps.  Likewise, in 2006, 
Medicare allowed approximately $7,200 in rental payments over 36 months for an oxygen 
concentrator that cost approximately $600 to purchase.  Beneficiary coinsurance alone for 
renting an oxygen concentrator for 36 months exceeded $1,400 (more than double the purchase 
price). 
 
OIGs Strategy and Recommendations for Combating Fraud, Waste, and Abuse 
 
Combating health care fraud requires a comprehensive strategy of prevention, detection, and 
enforcement.  OIG has been engaged in the fight against health care fraud, waste, and abuse for 
more than 30 years.  Based on this experience and our extensive body of work, we have 
developed five principles of an effective health care integrity strategy.  OIG uses these principles 
in our strategic work planning to assist in focusing our audit, evaluation, investigative, 
enforcement, and compliance efforts most effectively. 
 
1.  Enrollment:  Scrutinize individuals and entities that want to participate as providers and 
suppliers prior to their enrollment in the health care programs. 
  
The first step in preventing health care fraud and abuse is to stop those who would defraud or 
abuse the programs from gaining entry to them.  The concept is simple but the execution can be 
challenging.  The Medicare program was designed to make it easy to enroll as a provider to 
encourage participation and ensure beneficiary access to services.  However, this also makes it 
too easy for sham providers and suppliers to obtain Medicare billing numbers and bill for 
millions of dollars in fraudulent claims.  
 
In 2006 and 2007, OIG conducted unannounced site visits to almost 2,500 Medicare DME 
suppliers in South Florida and Los Angeles and found that almost 600 of these suppliers (about 
24 percent) did not maintain a physical facility or were not open and staffed during business 
hours, as required.  OIG has recommended heightened enrollment screening and oversight for 
high-risk items and services.  CMS has taken some important steps toward this end, particularly 
for DME providers in South Florida.  Additional scrutiny for high risk areas through 
unannounced site visits, background checks, enhanced claims screening for new enrollees, and 
enhanced authorities (such as explicit authority to impose temporary enrollment moratoriums) 
could further discourage this type of fraud.  OIG will continue to monitor the effectiveness of 
provider enrollment safeguards. 
 
2.  Payment:  Establish payment methodologies that are reasonable and responsive to changes in 
the marketplace and medical practice. 
 
Establishing reasonable and responsive payment methodologies prevents the type of waste, 
described above, that results when payment methodologies are misaligned with costs and market 
prices.  OIG has identified these misalignments for various health care services and products, and 
we have recommended fixes.  For example, capping rental of oxygen concentrators at 13 months 
instead of 36 months would save Medicare billions of dollars.   
 
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House Appropriations Committee    Page 4 of 10 
Subcommittee on Labor, Health and Human Services, Education, and Related Agencies 
March 4, 2010                                                                                                   Applying this principle can also deter fraud.  For example, an OIG evaluation found that in 2007, 
Medicare allowed, on average, about $4,000 for standard power wheelchairs that cost suppliers, 
on average, about $1,000 to acquire.  Profit margins like these attract fraud.  OIG has 
investigated numerous cases of fraudulent billing for power wheelchairs, and in some of these 
cases, the suppliers actually provide wheelchairs to beneficiaries who do not need them because 
the reimbursement  even after purchasing the wheelchair  is high enough to make this scam 
lucrative.  CMS has the authority to make certain adjustments to payments for DME and other 
items or services, but for some changes (such as reducing the rental period for oxygen 
concentrators), legislative changes are needed.   
 
3.  Compliance:  Assist health care providers and suppliers in adopting practices that promote 
compliance with program requirements.   
 
The vast majority of health care providers and suppliers are honest and well-intentioned.  They 
are valuable partners in ensuring the integrity of Federal health care programs.  OIG seeks to 
collaborate with health care industry stakeholders to foster voluntary compliance efforts.  
Toward this end, OIG has produced extensive resources (available on our Web site at 
http://oig.hhs.gov) to assist industry stakeholders in understanding the fraud and abuse laws and 
designing and implementing effective compliance programs.  These resources include sector-
specific Compliance Program Guidance documents that describe the elements of effective 
compliance programs and identify risk areas, advisory opinions, and fraud alerts and bulletins.  
We have a self-disclosure program that encourages providers to self-report fraud uncovered 
within their company and to work with OIG to resolve the problem fairly and efficiently.  
Effective compliance programs help make honest providers our partners in the fight against 
health care fraud.  OIG recommends that providers and suppliers should be required to adopt 
compliance programs as a condition of participating in the Medicare and Medicaid programs.   
 
4.  Oversight:  Vigilantly monitor the programs for evidence of fraud, waste, and abuse. 
 
Rapid detection of fraud, waste, and abuse is essential to ensuring the integrity of health care 
dollars.  This includes using data and technology to detect potential problems as claims are 
submitted and before they are paid.  It also includes conducting advanced data analysis to 
identify, track, and monitor patterns of fraud to target enforcement efforts.  With appropriate 
protections, identifying effective ways to share information across Federal and State agencies 
and with private insurers can leverage resources and improve our collective effectiveness in 
fighting fraud, waste, and abuse.  Through HEAT, progress has been made in improving law 
enforcements access to Medicare data, sharing information and intelligence, and conducting 
data analysis to prioritize and target our fraud-fighting efforts. 
 
5.  Response:  Respond swiftly to detected fraud, impose sufficient punishment to deter others, 
and promptly remedy program vulnerabilities. 
 
Although it is ideal to prevent payments for fraudulent or improper claims, there will never be 
perfect prevention.  An effective anti-fraud strategy must incorporate a strong enforcement 
component.  Criminals balance the risk of detection and punishment against the benefits of the 
crime and have concluded that Medicare and Medicaid fraud are a good bet.  It is imperative that 
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House Appropriations Committee    Page 5 of 10 
Subcommittee on Labor, Health and Human Services, Education, and Related Agencies 
March 4, 2010                                                                                                   we change the calculation by increasing the risk of prompt detection and the certainty of 
punishment.   
 
As part of this strategy, OIG is working closely with its partners in DOJ and in the States to 
accelerate and maximize the effectiveness of our law enforcement response to fraud.  Medicare 
Fraud Strike Forces represent one very successful enforcement model.  In addition, OIG 
investigates and DOJ prosecutes civil cases that return billions of dollars to the Medicare and 
Medicaid programs.  OIG is also using our administrative authorities to hold responsible 
individuals accountable for fraud, including physicians who accept kickbacks and responsible 
corporate officials whose companies have committed fraud.   
 
CMS and States must also respond swiftly to recoup misspent funds, take appropriate 
administrative actions (e.g., revoking billing privileges, suspending payments), and remedy 
program vulnerabilities.  Through the HEAT initiative, described in more detail below, the 
Government is significantly accelerating and strengthening its response to fraud, waste, and 
abuse. 
 
Resources and Tools for Health Care Oversight and Enforcement Activities 
 
Adequate funding of the Health Care Fraud and Abuse Control (HCFAC) Program is vital to the 
fight against fraud, waste, and abuse. 
 
The Health Care Fraud and Abuse Control (HCFAC) Program is a comprehensive program under 
the joint direction of the Attorney General and the Secretary of HHS, acting through our OIG, 
designed to coordinate Federal, state and local law enforcement activities with respect to health care 
fraud and abuse. The HCFAC Program draws funds from the Medicare Trust Fund to finance 
anti-fraud activities.  Certain of these sums are to be used only for activities of OIG, with respect to 
the Medicare and Medicaid programs.  The HCFAC Program is OIGs primary funding stream, 
and accounts for 73 percent of our FY 2010 appropriation. 
 
From its inception in 1997 through 2008, HCFAC Program activities returned more than 
$13.1 billion to the Federal Government.  The HCFAC return-on-investment is $6 for every $1 
invested in OIG, DOJ, and HHS activities through the HCFAC Account.2  This return-on-
investment calculation includes only actual recoveries, such as dollars returned to the Federal 
Government and redeposited in the Medicare Trust Fund, the Treasury or returned to other 
Federal victim agencies.  Savings realized from implementation of OIGs recommendations to 
promote economy, efficiency, and effectiveness of Medicare and Medicaid operations create 
additional returns from OIG operations, but these are not captured in HCFAC return-on-
investment calculations. 
 
Thanks to this Subcommittees support for investing in HCFAC activities, OIGs total HCFAC 
appropriation for FY 2010 is $207 million, which includes $177 million in mandatory funds and 
almost $30 million in discretionary funding.  OIG is directing these resources to conduct 
                                                 
2 The $6 to $1 return on investment is a 3-year rolling average from 2006-2008, which is used to help account for 
the natural fluctuation in returns from investigative, enforcement, and audit activities. 
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House Appropriations Committee    Page 6 of 10 
Subcommittee on Labor, Health and Human Services, Education, and Related Agencies 
March 4, 2010                                                                                                   Medicare and Medicaid investigations, audits, evaluations, enforcement, and compliance 
activities to support our health care program integrity strategy described above.  Examples of our 
HCFAC-funded activities include:  
  Establishment of Strike Force teams in seven cities;  
  Support of Civil False Claims Act investigations and enforcement;  
  Support of administrative enforcement activities; 
  Evaluations of Medicare contractor operations, services provided to nursing home residents, 
Medicare and Medicaid reimbursement for prescription drugs, and other issues;  
  Audits of payments to hospitals, home health agencies, Medicare Advantage plans, and 
Medicare Part D plans, among other providers;  
  Monitoring of providers under corporate integrity agreements; and  
  Issuance of advisory opinions and other guidance to the health care industry. 
 
In addition to the $30 million in discretionary HCFAC funds in FY 2010 (which will continue 
into FY 2011), the Presidents FY 2011 Budget proposes an additional $65 million increase in 
HCFAC discretionary funding.  This represents a net increase of $40 million in total funding for 
OIGs health care integrity activities.   
 
The proposed $65 million increase in HCFAC discretionary funding includes $25 million to 
continue funding OIGs oversight and enforcement activities that were previously funded 
through the Deficit Reduction Act of 2005 (DRA).  The DRA provided $25 million each year in 
FYs 2006-2010 to fund OIGs Medicaid integrity activities.  In recognition of the continued need 
for OIG oversight and enforcement beyond FY 2010, the Administration included $25 million in 
its request for FY 2011 for OIG to sustain health care oversight activities.  The proposed budget 
would enable us to continue fraud-fighting efforts that would otherwise necessarily dwindle as 
the DRA funding ceased.  Further, providing these funds under HCFAC provides the advantages 
of consolidating funding streams with similar purposes and expanding the authorized use of 
these funds to include Medicare oversight as well as Medicaid oversight.  Medicare and 
Medicaid program integrity activities are often related.  For example, many of our investigations 
involve an individual or entity committing fraud against both programs.   
 
The proposed $65 million HCFAC increase also includes $40 million in new funding for OIGs 
activities in support of the HEAT initiative, including establishing Strike Force teams in 13 new 
locations.  We estimate that almost $25 million of this funding would be needed to support the 
Strike Force expansions and the remaining $15 million would support OIGs other HEAT 
activities, including audits, evaluations, civil and administrative enforcement, and compliance 
activities. 
 
Through HEAT, OIG is enhancing the impact of our prevention, detection, and enforcement 
efforts.  
 
OIG is a key member of HEAT; indeed, HEATs fraud and abuse prevention, detection, and 
enforcement activities are our primary focus and core mission.  The collaboration brought about 
by HCFAC and enhanced by HEAT has improved coordination and communication, which has 
in turn led to greater impact and effectiveness of our collective fraud-fighting efforts. 
 
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House Appropriations Committee    Page 7 of 10 
Subcommittee on Labor, Health and Human Services, Education, and Related Agencies 
March 4, 2010                                                                                                   Prevention.  Prevention of health care fraud, waste, and abuse was written into the legislation 
that created OIG  it is integral to our mission and activities.  OIG makes recommendations to 
the Centers for Medicare & Medicaid Services (CMS) to remedy program vulnerabilities that we 
uncover through our evaluations and audits.  OIG also provides CMS with intelligence gleaned 
from our investigations and data analysis to help CMS target its prevention efforts effectively.  In 
addition, OIGs guidance and outreach to the health care industry help the well-intended health 
care providers avoid fraudulent or abusive conduct and promote compliance with program 
requirements.  Further, our enforcement activities prevent fraud by stopping ongoing schemes 
and deterring future fraud. 
 
HEAT has strengthened these prevention efforts.  It has provided a forum for advancing OIGs 
recommendations to remedy program vulnerabilities in Medicare and Medicaid.  For example, 
senior staff from OIG and CMS are working together to plan actions that CMS can take in the 
short term to address some of OIGs outstanding recommendations.  In addition, HEAT has 
increased interagency communication about fraud trends, new initiatives, and ideas through the 
creation of committees and work groups comprised of experts from across HHS and DOJ who 
meet regularly to collaborate and develop new strategies for preventing fraud, waste, and abuse.  
Also, in conjunction with HEAT, OIG is considering further outreach opportunities to engage 
health care providers in fraud prevention. 
 
Detection.  In support of HEAT, OIG has developed and leads a data analysis team, which 
includes DOJ and CMS, to identify fraud patterns and trends and strategically target all of our 
resources.  This data analysis team identified geographic concentrations of fraud to help 
determine in what cities to establish new Strike Force teams and analyzes fraud indicators to 
provide specific investigative leads to Strike Force teams.  
 
Collaborating with our partners through HEAT has also resulted in improved data access for law 
enforcement.  Access to real-time claims data  that is, as soon as the claim is submitted to 
Medicare  is critical to identifying fraud as it is being committed.  With real time knowledge, 
we would be better able to stop the fraud more quickly and to bring the perpetrator to justice and 
recoup the stolen funds before the criminal or the money disappears.  Timely data is also 
essential to our agile response as criminals shift their schemes and locations to avoid detection.  
Although we do not yet have access to comprehensive real-time claims data, we have made 
important strides in obtaining data more quickly and efficiently.  On a pilot basis, CMS recently 
provided several OIG investigators and analysts access to a Medicare data system that includes 
much of the real-time claims data that law enforcement needs.  OIG, DOJ, and CMS have also 
worked together to develop a data request template so that CMS contractors can process our data 
requests faster and with more efficiency.   
 
Enforcement.  OIG and DOJ jointly lead the Medicare Fraud Strike Force teams, which have 
expanded through HEAT from two to seven locations.  The successes of these Strike Forces are 
described in detail below.  In addition, HEAT has also led OIG and DOJ to jointly reassess our 
resource allocation for our civil fraud cases, which have yielded billions of dollars in returns, to 
ensure that we are prioritizing these resources most effectively. 
 
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House Appropriations Committee    Page 8 of 10 
Subcommittee on Labor, Health and Human Services, Education, and Related Agencies 
March 4, 2010                                                                                                   Medicare Fraud Strike Forces have proven to be successful in fighting health care fraud. 
 
The Strike Forces are an essential component of HEAT and have achieved impressive 
enforcement results.  Collectively, Strike Forces have resulted in approximately 270 convictions, 
indictments of more than 500 defendants, and more than $240 million in court-ordered 
restitutions, fines, and penalties.  Strike Forces also deter fraud.  For example, during the first 
year of Strike Force operations in Miami, which focused on DME fraud, submissions of DME 
claims decreased by 63 percent, representing a decrease of $1.75 billion, compared to the 
previous year.  The Strike Force model is especially effective for investigating and prosecuting 
health care fraud cases involving sham Medicare providers and suppliers masquerading as 
legitimate health care providers and suppliers. 
 
Strike Forces are designed to identify, investigate, and prosecute fraud quickly.  Strike Force 
teams are comprised of dedicated DOJ prosecutors and Special Agents from OIG, the Federal 
Bureau of Investigations, and, in some cases, State and local law enforcement agencies.  These 
on the ground enforcement teams are supported by the data analysis team (described above) 
and by CMS program experts and contractors.  This coordination and collaboration has 
accelerated the Governments response to criminal fraud, decreasing by roughly half the average 
time from an investigations start to the cases prosecution. 
 
Under HEAT, Strike Forces have expanded from two locations (Miami and Los Angeles) to 
seven.  In May 2009, new Strike Forces were announced in Houston and Detroit.  In December 
2009, Strike Forces teams became operational in Brooklyn, Tampa, and Baton Rouge. 
 
The Presidents FY 2011 Budget proposal would expand Strike Forces to 13 new locations, 
bringing the total number of Strike Force locations to 20.  The selection of Strike Force locations 
is based on data analysis of Medicare claims to determine fraud hot spots. 
 
OIG estimates that it will require almost $25 million to establish and operate Strike Forces in 13 
new locations.  This funding would support an estimated 130 full-time employees dedicated to 
Strike Force operations and support.  These 130 employees would primarily be comprised of 
investigative staff, including criminal investigators, supervisory investigators, computer forensic 
specialists, and investigative operations trainers.  Additional staff supporting the new Strike 
Forces would include auditors, evaluators, data analysts, attorneys, and administrative and 
information technology (IT) staff.   
 
With this funding, OIG is committed to working with our DOJ partners to establish Strike Forces 
in 13 new locations.  We anticipate that it will take us through 2012 to fully launch Strike Force 
teams in all 13 cities, consistent with the two-year time frame for which the money would be 
available under the Presidents proposal.  However, immediately upon receiving the funding, we 
will begin hiring and training staff and conducting the other preparatory work, such as leasing 
additional space and purchasing IT and other equipment, necessary to launch and support the 
new Strike Force teams. 
 
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House Appropriations Committee    Page 9 of 10 
Subcommittee on Labor, Health and Human Services, Education, and Related Agencies 
March 4, 2010                                                                                                   Conclusion 
 
Health care fraud, waste, and abuse are serious problems that cost taxpayers billions of dollars 
every year and require focused attention and commitment to solutions.  Protecting Medicare and 
Medicaid beneficiaries and taxpayer dollars is integral to OIGs mission.  Through the dedicated 
efforts of my staff and our collaboration with HHS and DOJ, we have achieved substantial 
results in the form of recoveries of stolen and misspent funds; enforcement actions taken against 
fraud perpetrators; improved methods of detecting fraud and abuse; and solutions to address 
program vulnerabilities and prevent fraud, waste, and abuse from occurring.  Working together, 
we are maximizing our collective effectiveness and success in this endeavor.  Health care fraud, 
waste, and abuse are long-standing problems that require sustained commitment to combat them.  
On behalf of OIG, I make that commitment to you.  Thank you for your attention to and support 
for this mission.  I welcome your questions. 
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House Appropriations Committee    Page 10 of 10 
Subcommittee on Labor, Health and Human Services, Education, and Related Agencies 
March 4, 2010