A nationwide, comprehensive audit of Medicare conducted by the Health and Human Services inspector general which is scheduled to be released today, "will show that eliminating mispayments and fraudulent claims would raise more money over the next five years than Congress is cutting in the current reconciliation bill," Congress Daily reports.
The audit found that in 1996, Medicare mispaid one out of every three claims. This resulted in overpayments of $23 billion, or 14% in Medicare's standard program budget, the St. Louis Post-Dispatch reports.
In the audit of 5,300 claims paid last year, the inspector general's office found that in 14 percent of claims there was no documentation to support the claim; in 32 percent of claims there was insufficient documentation; in 36 percent of claims the treatment provided was considered medically unnecessary and in eight percent of cases there were billing coding errors that resulted in billing for a more expensive procedure than was performed.
The New York Times reports that hospitals and clinics received 35 percent of the improper payments, the largest share. Doctors received 22 percent of the overpayments, home health agencies received 16 percent and nursing homes received 10 percent.
HHS Inspector General June Gibbs Brown said that "the books and records of the Medicare agency and its contractors were in such disarray that ... there was no way to tell how much of the overpayment resulted from fraud." She said, "These improper payments could range from inadvertent mistakes to outright fraud and abuse. We cannot quantify what portion of the error rate is attributable to fraud." The report also said that the Medicare system does not have a "reliable way to prevent or detect improper Medicare payments."
HHS spokesperson Melissa Skofield said, "This is the first comprehensive audit of Medicare's financial statements that we've ever had. It's a useful road map in our efforts to improve the integrity of the Medicare program." Health Care Financing Administration spokesperson H. Christopher Peacock said, "We are preparing an action plan to deal with the recommendations."
The Times reports that the amount of waste detected by the report is "by coincidence, the same as the amount of savings to be extracted from Medicare under the budget bill now pending in Congress -- $115 billion over five years, or an average of $23 billion a year."
Four senators released "highlights of the audit" yesterday. Congress Daily reports that Sens. Bob Graham, D-Fla., Tom Harkin, D-Iowa, Joe Biden, D-Del., and Jack Reed, D-R.I., asked conferees on the Medicare portions of the budget bill "to keep a variety of anti-fraud provisions that are in the Senate bill, including one that would require home health care and other providers to post a 'surety bond' before they could be issued a Medicare provider number."
Sen. Graham said of the waste, "What we're dealing with here is the human equivalent of cockroaches."
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