Medicare Fraud Eludes Even Tougher Measures

By Price, Joyce Howard | The Washington Times (Washington, DC), March 12, 2000 | Go to article overview

Medicare Fraud Eludes Even Tougher Measures


Price, Joyce Howard, The Washington Times (Washington, DC)


****THE HHS EFFORT TO REDUCE WASTE SPENDS MONEY TO SAVE MORE.****

Five years ago, Citizens Against Government Waste compared the Medicare program to a "Gucci-clad matron" toting a "flashing neon sign that says, `Please rob me.' "

In a hard-hitting report released at the time, CAGW said the federally financed health-insurance program for the elderly was a "sitting duck for con artists, thieves and degreed opportunists."

Since then, the U.S. Department of Health and Human Services has made a concerted effort to reduce Medicare fraud, waste and abuse - spending money to save much more.

"If you look at the statistics, there appears to have been a reduction in Medicare fraud," said Elizabeth Wright, health and science director for CAGW.

However, federal officials cannot say that definitively.

Since fiscal 1996, Medicare has drastically decreased so-called "improper payments" made in its mammoth fee-for-service program. That program pays out more than $200 billion a year to 1 million health care providers for services offered to nearly 40 million seniors and disabled Americans.

But the improper payments itemized annually do not necessarily include Medicare fraud.

"It's important not to characterize this as a measure of fraud. . . . Fraud is very difficult to quantify," said Alwyn Cassil, spokeswoman for the HHS Inspector General's Office. "If you don't detect it, how can you measure it?

"We don't know how much Medicare fraud there is," added Ms. Cassil, whose office has been required to conduct Medicare audits by federal law since fiscal 1996.

Improper payments include claims with "insufficient or no documentation" or "incorrect coding." They also include payments for "noncovered or unallowable" medical services and for services that were not medically necessary.

Data released Thursday by Health Care Finance Administration (HCFA) estimated improper Medicare payments in fiscal 1999 at $13.5 billion, down from $23.2 billion in fiscal 1996 and $20.3 billion in fiscal 1997.

The Medicare loss figure last year represented a payment error rate of 7.97 percent. That compared with 14 percent in fiscal 1996 and 11 percent the following year.

On the downside, Medicare's improper payment total of $13.5 billion last year inched up from $12.6 billion in fiscal 1998. Its estimated rate of payment error the previous year was 7.14 percent.

However, as HCFA Administrator Nancy-Ann DeParle told a Senate subcommittee Thursday, the difference between the 1998 and 1999 payment error rates is "not statistically significant" in the eyes of auditors with the HHS Inspector General's Office.

The error rate for claims payments is holding steady at about half of what it was in 1996, Mrs. DeParle told the Appropriations' Subcommittee on Labor, Health and Human Services, and Education. She said the better results held even though this year's claims sample - used to calculate the error rate - includes more claims for problem areas such as home health and medical equipment.

"These results show that our progress is not a one-time phenomenon, but something sustainable on which we can build," Mrs. DeParle said.

The Medicare fee-for-service program paid out $169.5 billion last year. A loss of $13.5 billion means that nearly 8 cents out of every dollar paid out was wasted. In contrast, the program lost 7 cents on every dollar the year before.

Sen. Charles Grassley, Iowa Republican and chairman of the Special Committee on Aging, said HCFA needs to do more to cut Medicare losses.

"With all of its available resources, the government should be able to stop this milking of the Treasury," said Mr. Grassley, also a member of the Budget Committee.

Documentation errors - when there's little or no paperwork to determine whether services billed for were actually performed - were responsible for $5. …

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