Medicare is a program that is designed to ensure our nation’s seniors receive the best possible health care. Despite this noble goal, Medicare is highly susceptible to fraud. Over the course of a two-year bipartisan investigation, I have identified multiple vulnerabilities in the Medicare system — areas where the program simply didn’t have a guard at the front door to prevent scam-artists from ripping off taxpayer dollars. The good news is that the Center for Medicare & Medicaid Services has finally agreed to implement sweeping changes to prevent waste, fraud, and abuse in Medicare

As former chairman and current ranking member of the Permanent Subcommittee on Investigations (PSI), I focused on the Medicare Durable Medical Equipment (DME) program, in which Medicare pays for certain medical supplies such as walkers and wheelchairs. The program, through which billions of dollars flow each year, has been plagued by persistent and pervasive waste, fraud and abuse. The DME process is designed to be simple: after a doctor prescribes a medical device, the patient obtains the prescribed equipment from an approved DME supplier. The DME supplier then bills Medicare directly, and Medicare reimburses the DME supplier for most of cost of the device. At every stop along the way, my subcommittee uncovered vulnerabilities in the system that can allow crooks to game the system, steal taxpayer dollars and ultimately hurt seniors who lose out when these con-artists bilk resources from the system.

Perhaps most disturbingly, we found Medicare had paid for roughly 500,000 claims in which the doctors who allegedly wrote the prescriptions had died long ago. For hundreds of thousands of claims, the doctors had died five, ten, or even 15 years earlier. Many cases were jaw-dropping; there was no doctor, no patient and no prescription — just fraudulent DME suppliers using the identification numbers of dead doctors to bill Medicare directly. All told, we estimated that these improper payments could have reached as high as $100 million in just a few years. Shockingly, Medicare paid the claims without so much as raising an eyebrow.

Another part of our investigation focused on the following question: How easy is it for scam artists to become authorized DME suppliers? Sadly, if you have a computer, the answer is: too easy. To examine the problem, we directed the Government Accountability Office (GAO) to set up fake DME supplier storefronts to test the Medicare system. With no inventory, and with relative ease, these investigators were able to establish a virtual office, and Medicare was all too eager to give them the necessary billing numbers. Once they became approved DME suppliers, they could essentially treat Medicare like an ATM machine. In fact, GAO stated that “We could have fraudulently billed Medicare for substantial sums — potentially reaching millions of dollars.”

As my subcommittee examined the DME industry, over and over we noticed claims for medical equipment that didn’t match the listed diagnosis. For example, the DME supplier would submit a claim to be reimbursed for a walker, when the diagnosis code was for sinus congestion. We uncovered thousands upon thousands of claims with these questionable diagnoses. I simply don’t think it is plausible that a doctor would prescribe a blood glucose test strip for the bubonic plague. Nevertheless, Medicare paid for those claims without batting an eyelash — to the tune of $1 billion. Since the Medicare payment systems didn’t check the diagnosis code, it was as easy as drawing numbers out of a hat, calling it a code, and waiting for Medicare to send them a check — all at the expense of the American taxpayer.

CMS’s failure to examine questionable diagnosis codes is only half the story. More than $4.8 billion of paid claims contained an invalid diagnosis code. We found cases in which suppliers entered an exclamation point or a question mark as the diagnosis. We examined a large swath of these claims and found that more than 30 percent had characteristics of fraud. Despite these glaring problems, CMS sent them a check too.

Not only did we uncover these problems, we also examined solutions and made numerous recommendations to fix the problems. As a result of bringing these issues to light, CMS’ new rules include conducting more stringent reviews, making unannounced site visits to make sure businesses are legitimate, imposing stricter validation and verification processes, and following up with high-risk beneficiaries to ensure they are appropriately receiving items.

It should not haven been so easy to defraud this important program. Con-artists didn’t need to develop an elaborate scheme to rob the American taxpayers — it was ripe for the taking. Bottom line, we simply cannot afford to ignore these billion dollar loopholes any longer and I am encouraged by CMS’s efforts to clean up the DME system. I will continue to aggressively push CMS to make sure these changes are effective in preventing fraud and abuse in Medicare. Ensuring that Medicare can accomplish its noble goals while protecting our tax dollars from waste, fraud and abuse must be a top priority.

Norm Coleman, R-St. Paul, is a U.S. senator.