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A $20 million difference

As discouraging as government finances — both in Annapolis and Washington — have been of late, there is some good news on the horizon. Estimates released last week by the Maryland Department of Health and Mental Hygiene suggest the state will collect about $20 million more from scofflaws attempting to defraud the Medicaid program.

That may not solve the state's projected $1 billion-plus projected budget deficit in fiscal 2012, but it certainly doesn't hurt. In the fiscal year that ended June 30, the health department recovered about $26.5 million as a result of Medicaid fraud, waste and abuse investigations, which was also higher than in previous years.

But why a 75 percent jump in collections? It's all due to passage this year of a new law that puts more teeth in the state's prosecution of false health care claims. Amazingly, the measure backed by Gov. Martin O'Malley almost didn't pass in the last General Assembly session.

Beginning in October, the health department investigators will be able to seek triple damages against those caught defrauding Medicaid. A majority of states have similar authority, as does the federal government, but health care providers and some business lobbyists opposed the bill on the grounds it would generate frivolous lawsuits by disgruntled employees.

The reality is that those who defraud Medicaid deserve what they have coming. Without triple damages, the penalties against such abuse were modest. Bilking Medicaid too often resulted in no worse than reimbursement of the ill-gotten gains, as if the government had just provided the perpetrator with an interest-free loan.

Yet Medicaid fraud is not about accounting errors or honest mistakes. It's typically about knowingly billing the government for services that weren't provided or clearly weren't needed, making up patients who don't exist, or perhaps drug companies promoting off-label uses in violation of law.

The more money the government collects, the less health care will depend on large withdrawls from the state treasury. And in this category, things are looking up. A report released Monday by a state task force estimates that the sweeping health care legislation championed by President Barack Obama will boost Maryland's budgetary bottom line by more than $800 million over 10 years.

Of course, the anti-fraud law probably won't end problems in the massive Medicaid program, but it is certainly a step in the right direction. Between the savings to taxpayers and the prospect of less fraud in the future, it's a double benefit for Maryland.

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