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Obama Using 'Bounty Hunters' to Root Out Fraud

Obama health speech in Glenside, Pa.

Mar. 8: President Obama speaks about health care reform at Arcadia University in Glenside, Pa.AP

WASHINGTON -- President Barack Obama said Tuesday he'll bring in high-tech bounty hunters to help root out health care fraud, grabbing a populist idea with bipartisan backing in his final push to overhaul the system.

The White House announcement came as Obama prepared to travel to Missouri on Wednesday, taking his closing argument to the nation's heartland. The trip will be his second public appearance this week to rally support and fire up nervous Democrats.

The White House released details of the anti-fraud plan hours after a fresh challenge to the administration from major business groups that unveiled a multimillion-dollar ad campaign arguing that under Obama's plan "health care costs will go even higher, making a bad economy worse."

The ad buy, costing between $4 million and $10 million, will start Wednesday on national cable TV outlets. Later in the week, the campaign shifts to 17 states home to moderate and conservative Democrats. Their votes are critical to Obama's endgame for passing legislation to expand coverage to millions who now lack it and revamp the health insurance system.

On Capitol Hill, White House Chief of Staff Rahm Emanuel and other senior administration officials met with House and Senate Democratic leaders, who have struggled to secure the votes for the stalled health care legislation.

The two-step approach now being pursued calls for the House to approve a Senate-passed bill from last year, despite House Democrats' opposition to several of its provisions. Both chambers then would follow by approving a companion measure to make changes in that first bill.

"We're going to get it done as soon as possible," Emanuel told reporters after the meeting.

White House press secretary Robert Gibbs has said he expects the House to act by March 18, the day Obama leaves for an overseas trip. That timetable would be tough to meet, and congressional leaders told Emanuel on Tuesday that they don't need deadlines handed down from the White House, according to Rep. Henry Waxman, D-Calif., who chairs the Energy and Commerce Committee and attended Tuesday's meeting.

"He was certainly informed that we don't feel that we want any deadline assigned to us," Waxman said. "We want to pass the bill. We want to make sure it's the way it should be. And as soon as possible."

Republicans are playing on House Democrats' suspicions of their Senate colleagues, arguing that Senate Democrats may not hold up their end of the bargain and the votes will be politically damaging for Democrats in November.

"They will be voting, when they pass the Senate bill, to endorse the Cornhusker kickback, the Louisiana Purchase, the Gator-aid, the closed-door deal, the special deal for the unions, which may or may not bother any Democrats, I don't know -- but it will be riddled with special deals," Senate Minority Leader Mitch McConnell, R-Ky., said.

Obama's anti-fraud announcement was aimed directly at the political middle.

Waste and fraud are pervasive problems for Medicare and Medicaid, the giant government health insurance programs for seniors and low-income people. Improper payments -- in the wrong amounts, to the wrong person or for the wrong reason -- totaled an estimated $54 billion in 2009. They range from simple errors such as duplicate billing to elaborate schemes operated by fraudsters peddling everything from wheelchairs to hospice care.

The bounty hunters in this case would be private auditors armed with sophisticated computer programs to scan Medicare and Medicaid billing data for patterns of bogus claims. The auditors would get to keep part of any funds they recover for the government. The White House said a pilot program run by Medicare in California, New York and Texas recouped $900 million for taxpayers from 2005-2008.

The presidential memorandum Obama will sign Wednesday directs Cabinet secretaries and agency heads throughout the government to intensify their use of private auditors under current legal authority. Obama also announced his support for a bipartisan bill that would expand the ways government agencies can pay for such audits using recovered funds. Among its co-sponsors is Sen. John McCain, R-Ariz., Obama's GOP opponent in the 2008 presidential race.

The White House estimates that expanded use of private audits throughout the government could recoup at least $2 billion for taxpayers over the next three years. Much of that would come from Medicare and Medicaid, which have to scramble to keep up with the endless proliferation of new fraud schemes.

Obama his placing a heavy emphasis on battling waste and fraud in his final health care push. The repackaged bill he announced last month contained more than dozen anti-fraud ideas. A common theme linking them is the increased use of technology to spot suspicious billing patterns and keep track of service providers with a track record of problems.