Report documents $47 billion in improper Medicare payouts

By Hope Yen
Monday, November 16, 2009

The government paid more than $47 billion in questionable Medicare claims including medical treatment showing little relation to a patient's condition, wasting taxpayer money at a rate nearly three times that of the previous year.

Excerpts of a new federal report, obtained by the Associated Press, show a dramatic increase in improper payments in the $440 billion Medicare program that government auditors have cited as a high risk for fraud and waste for 20 years.

It is unclear whether Medicare fraud is worsening. Much of the increase in the past year is attributed to a change in the Department of Health and Human Services' methodology that imposes stricter documentation requirements and includes more improper payments -- part of a data-collection effort being ordered government-wide by President Obama this week to promote "honest budgeting" and accurate statistics.

Still, the fiscal 2009 financial report -- covering the first few months of the Obama administration -- highlights the challenges ahead for a government that is seeking in part to pay for its proposed health-care overhaul by cracking down on Medicare fraud. While noting that several new anti-fraud efforts were beginning, the government report makes clear that "aggressive actions" to date aimed at reducing improper payments had yielded little improvement.

In recent years, the suspect claims have included Medicare prescriptions from doctors who were dead, and requests for payment for medical supplies such as blood glucose strips for sexual impotence and diabetic shoes for leg amputees. Patients, many of them new citizens who barely speak English, are sometimes recruited by brokers who go door to door offering hundreds of dollars for use of their Medicare numbers.

Obama is expected to announce new initiatives this week to help crack down on Medicare fraud, including a government-wide Web site aimed at providing a fuller account of health-care spending and improper payments made by various agencies. The Centers for Medicare and Medicaid Services also will launch an interactive Web site next month that will allow users to track Medicare payment information.

According to the report, the Bush administration from 2005 to 2008 reported improper payments of about 4 percent in the fee-for-service program, or about $17 billion total in 2008. Government officials at the time, however, typically did not consider a Medicare payment improper if the medical documentation was incomplete or a doctor's signature was illegible.

-- Associated Press

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