WASHINGTON, June 25 – Sen. Bernie Sanders, a member of the Senate health committee, said today that real health care reform must address the billions of dollars in fraud and abuse that comes from the major corporations in the health care industry.

“What we have seen for many years is the systemic fraud perpetrated by private insurance companies, private drug companies, and private for-profit hospitals ripping off the American people and the taxpayers of this country to the tune of many billions of dollars,” Sanders (I-Vt.) said at a committee markup session.

Sanders cited example after example indicating that virtually all of the major hospital chains, private insurance companies, and pharmaceutical companies have been involved in massive health care fraud over the past decade.

The senator said Health and Human Services Department investigators found this year that 80 percent of insurance companies participating in the Medicare prescription drug benefit overcharged subscribers and taxpayers by an estimated $4.4 billion.  Altogether, he added, Medicare and Medicaid fraud totals some $60 billion a year.

Sanders also pointed to a string of criminal and civil cases against many of the leading corporate health care providers in the country, including:

In 2004, Warner-Lambert, a division of Pfizer Inc., pled guilty to two felonies and agreed to pay $430 million for fraudulently promoting the drug Neurontin.

In 2003, GlaxoSmithKline paid $88 million in civil fines for overcharging Medicaid for its anti-depressant Paxil.

In 1999, Hoffmann-LaRoche paid a $500 million criminal fine for leading a worldwide conspiracy to fix prices for certain vitamins.

In 2009, UnitedHealth, a leading insurance company, paid $350 million to settle lawsuits brought by the American Medical Association and other physician groups for shortchanging consumers and physicians for medical services outside its preferred network.
 
In 2009, the Centers for Medicare & Medicaid Services barred WellPoint, a major insurance company, from participating in Medicare Part D because WellPoint has “demonstrated a longstanding and persistent failure to comply with CMS’s requirements for proper administration…” 

In 2000, the Hospital Corporation of America agreed to pay $745 million to settle civil charges that it systematically defrauded Medicare, Medicaid and other federally-funded health programs.

In his remarks before the committee, Sanders suggested that it is absolutely imperative that real health care reform prevent major insurance companies, drug companies and hospital chains from perpetrating fraud and abuse on government health care programs and individuals, which are driving up health care costs in this country by billions of dollars every single year.