Medicare will need major structural reforms if it is to remain solvent for decades to come, but the program already would be on much sounder financial footing if the federal government would only work more aggressively to combat fraudulent Medicare billings. U.S. Sen. Bob Graham, D-Fla., has taken the issue of fraud as seriously as anyone in Washington. And well he should: Florida is home to more than its share of the estimated $30-billion a year American taxpayers lose to medical rip-offs.

The University of Florida this week agreed to pay $8.6-million to settle claims that faculty doctors at UF's College of Medicine improperly billed Medicare for care that was performed by resident physicians. The university will reimburse $6.8-million to the federal government and $1.8-million to the state Agency for Health Care Administration. It also will suffer incalculable embarrassment. However, there was nothing particularly unusual about UF's improper billing practices. Several prestigious universities across the country have agreed to even larger payouts to settle allegations of overbilling Medicare. The University of California paid $22.5-million in a similar settlement earlier this year; the University of Pennsylvania paid $30-million six years ago.

Those settlements might look like evidence of successful policing by Medicare investigators. However, the investigation at UF began only after a whistle-blower within the College of Medicine alerted authorities to evidence of improper billing. In all too many cases, government authorities have been stirred to action only after being prompted by whistle-blowers or media reports.

In any case, the type of overbilling alleged at UF is only a minor element of Medicare fraud. The program suffers much greater losses from more blatant rip-offs: patient-brokering outfits; dummy corporations and phony medical personnel; scam operations that bill Medicare for services that are not performed, or that were unnecessary in the first place.

Such fraudulent operations are especially prevalent in Florida. Graham estimates that $2 of every $10 spent on Medicare in South Florida is lost to fraud. That's about twice the national average.

Federal authorities have taken some recent steps that at least indirectly attack Medicare fraud. Requiring surety bonds from companies seeking to receive Medicare reimbursements for treatment or services has helped to discourage shell operations. Would-be Medicare providers also must go through a more extensive review process before going into business. However, authorities still do an inadequate of preventing fraud and waste among established providers.

Graham led the effort to build cooperation among local, state and federal authorities in investigating health care fraud in South Florida. He also happens to be one of the leading advocates in Washington for adding a prescription drug benefit for Medicare recipients. The money to pay for a prescription drug benefit will have to come from somewhere. With projected federal budget surpluses rapidly evaporating and Medicare funding formulas already under stress, a more effective crackdown on Medicare fraud would represent one of the fairest and least painful ways of finding billions of dollars for future benefits. Medicare fraud doesn't just harm today's taxpayers; it threatens the quality of care for future recipients.

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