Of health care, credit bans and Boba Fett

Part of a modern existence is that you're obliged to come to terms with the interconnectedness of pretty much everything. That iPhone you just bought generates profits not only for Apple and AT&T, but for the guy in the Village who created a video game app that sells for 99 cents. And he spends his money on coffee at the corner store, and that guy lives out in Brooklyn, and spends $80 a month on a MetroCard, etc etc etc.

With that in mind, I've been processing a few seemingly disparate pieces of news over the past few days. First (not chronologically, but still first) is this dollop from the White House:

Obama: 'Bounty Hunters' Will Help Fight Health Care Fraud With Computer Audits

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.

Ok, so this is politically-neutral, already vetted in the three biggest states in the country, and stands to gain us, the taxpayers, some cash, while improving Medicare. As long as it doesn't turn into "paying would-be fraud hunters for services promised" rather than "services rendered," this is aight with me.

Plus, you know, "Bounty Hunters" gives me a chance to post this pic:



But it also begs the question: Why not use this same system to expose securities fraud? Why not empower guys like Harry Markopolos instead of marginalizing them?

In case you missed it, Markopolos has a new book out and made an appearance on The Daily Show the other day. He's none too happy with the way things went, the way things are going, and the way he thinks things are going to continue to go.

The Daily Show With Jon Stewart	Mon - Thurs 11p / 10c
Harry Markopolos
www.thedailyshow.com
Daily Show Full Episodes Political Humor Health Care Reform

Markopolos already did basically what Obama is having the MediCare bounty hunters do, except he did it pro bono. Which is awesome, and you'd think would make him a pretty great choice as SEC chairman. But it turns out it's made him persona non grata with either party, as the entire corporate/government complex tries to make believe the Madoff scandal was an isolated incident.

As the whole Greece thing shows, it's not. And while Europe is finally taking some regulatory action - Europe moves to ban credit default swaps - it's clear that the Obama administration and the democrats in general don't have the stones to follow that lead.

But they've got to do something. As Markopolos said in his interview with Stewart, lawyers and pastry chefs and dilettantes don't have the expertise to catch the money folks. And the government doesn't have the intestinal fortitude.

So then it comes down to a process of the market: Make it pay for the money folks to turn on each other. Don't rely on acts of conscience. Rely on greed.