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Congress May Stop Hunt For Medicare Swindlers

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By DONNA ARDUIN

Published: February 13, 2008

While Medicare, our national health care program for seniors, drowns in waste and inefficiency, some members of Congress want to throw a life preserver to the health care organizations that improperly bill the program for billions of dollars each year.

As reported recently by NBC News, the problem is so pervasive that the FBI has organized strike teams to track down criminals who prey on this vital federal program, but say they have barely scratched the surface. One government auditor said ripping off Medicare is easier and less risky than selling drugs. The Office of Management and Budget reports that improper billing costs Medicare a whopping $10 billion annually - or about $27 million per day.

In 2003, Congress passed a pilot program to identify and recover improper payments to hospitals and other vendors under the Medicare Modernization Act. Frustrated with the lack of progress by traditional auditors, Congress authorized an incentive program under which the auditors get paid only if money is actually recovered and returned to the Medicare trust fund.

Medicare recovery audits started with three pilot efforts - in New York, California, and Florida, the states with the highest concentrations of seniors and therefore the highest amounts of Medicare payments. And it should come as no surprise that these auditors found plenty of problems and identified hundreds of millions of dollars for recovery.

According to data just released by the government, recovery auditors recovered more than $350 million in Medicare overpayments in fiscal 2007 alone - with 88 percent of that total coming from inpatient hospitals. Medicare officials are readying a nationwide rollout of the program right now.

But hospitals have shown they are capable of using their muscle to convince Congress to look the other way. The hospital lobby, including its national trade association and the local groups in California, New York and Florida, has sponsored legislation that would suspend the audit program until a laundry list of "concerns" and "issues" can be evaluated in depth, and are hoping to get as many members of Congress to line up behind them as possible.

That would be unfortunate. In addition to recovering money for the Medicare Trust Fund, recovery auditing is also helping shine a light on processes - whether intentional or through errors - that result in improper billing and payments.

We must not continue to let the Medicare program drown in waste and fraud. Recovery auditing is the life preserver this program needs.

Donna Arduin is president of Arduin, Laffer & Moore and advises states on fiscal and policy issues. She previously managed budgets in California, Florida, New York and Michigan.

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