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July 2016

Medicare, Money, Mistakes – Skewed Reporting, Payment Fraud, Cover-ups Still Rampant

Washington Watch


Medicare continues to bleed money, failing to recoup billions of dollars from Medicare Advantage plans it is owed, while also issuing improper payments to hospitals and medical services for elderly care, two new government reports have revealed.


Private Medicare Advantage plans treating the elderly have overbilled the government by billions of dollars, but rarely been forced to repay the money or face other consequences for their actions, a sharply critical new Congressional audit found. The Government Accountability Office (GAO) audit called out Medicare to make “fundamental improvements” to curb overbilling.


The Medicare Advantage plans, an alternative to traditional fee-for-service Medicare, are extremely popular with seniors and currently have more than 17 million people enrolled at an estimated cost to taxpayers of more than $160 billion last year. But detailed investigative reporting by four-time Pulitzer-Prize winner Fred Schulte of the Center for Public Integrity prompted the GAO to scrutinize Medicare’s wasting billions of dollars annually through manipulation of “risk scores.” These scores are a formula meant to pay health plans more for sicker patients and less for healthy people. But the formula often pays too much.


The GAO criticized Medicare’s efforts to recoup overcharges using a secretive, and lengthy, audit process called Risk Adjustment Data Validation, or RADV. Unlike many other anti-fraud programs, RADV has cost the government way more than it has returned to the treasury. The numbers are simply staggering.


Medicare has spent about $117 million on these audits, but so far has recouped just $14 million. But Medicare officials counter that the mere threat of RADV audits has caused health plans to voluntarily return approximately $650 million in overpayments – and that upcoming audits will recover another $370 million more. Critics point out that combined, this is less than 10 percent of the amount that could potentially be recovered.


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The Traumatic Birth of The Magic Box


During World War II, the American public had to cut back on many things to which we had become accustomed. New cars were not available. Tires and gasoline were rationed. Men’s trousers could no longer sport cuffs. Sugar and meat were severely limited for civilian use. And, there was an item we had not been able to acquire as yet but for which our collective mouths were watering – the wonderful world of television.


We knew it existed – this exciting technology of moving pictures, complete with soundtrack, piped right into our living rooms. We’d seen or read about lab experiments which showed it could be done. Our expectations were great. Even Dick Tracy’s famous wrist radio was no longer enough high tech magic for us. Suddenly the iconic wrist radio sported a moving picture that would soon be available to everyone. But, the war must be won first.


In the aftermath of that war, many other wondrous things were quickly available for which we’d longed throughout the long years of war’s deprivation. Although you had to wait in line to get one, sparkling new cars were rolling off the assembly line. You could once again choose from a large selection of men’s suits, and even have cuffs on the trousers if desired. You could pull up to a gasoline pump and tell the attendant to “Fill ‘er up, please.”


But... alas, the one thing missing for which we’d waited impatiently was not immediately available. We had all heard about this great new electronic device that we could have once the war was over. But no, there was no television for 99% of the American people.


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