Contractors hired as private eyes to combat Medicare fraud have let cases go cold, Associated Press reports. Although $835 million in questionable Medicare payments were identified by private contractors in 2007, the government managed to recover only $55 million (7 percent) according to a report from the Office of the Inspector General.
Sen. Charles Grassley (R-Iowa), the ranking Republican on the Senate panel that oversees Medicare, told the AP that taxpayers may not be getting good value from for-hire fraud fighters.
"Medicare is already a pay-and-chase system when it comes to fraud, waste and abuse," he said. "Providers are paid first, then questioned if there's a problem. Add to that mix contractors who sit on cases of ongoing fraud when they should be referring them to law enforcement, and you have a recipe for disaster."
Congressional investigators found that the average investigation lasted 178 days, long enough for many cases to go cold, making it hard to nab the perpetrators or recover money owed taxpayers.
Medicare overpayments totaled more than $36 billion in 2009, AP reports. In 2005, taxpayers paid these contractors $102 million.
At least seven private companies, which Medicare refers to as "Program Safeguard Contractors" are involved in detecting fraud. Their track records have varied widely, AP reports. One identified $266 million in overpayments in 2007, according to the OIG report released in May. Another identified $2.5 million in overpayments.
Most contractors were not doing a good job at spotting new fraud trends, the inspector general noted, with minimal results from proactive data analysis.
The low collection rate may not be contractors' fault, the AP notes. When Medicare notifies a provider of disputed payments, the fraudulent ones often close up shop and move on.
The Obama administration said it is reorganizing contracts and trying to help them coordinate better with claims processors and law enforcement.
To learn more:
- read the report from the Office of the Inspector General: Medicare Overpayments Identified by Program Safeguard Contractors
- read the OIG’s report: Collection Status of Medicare Overpayments
- read the Associated Press article
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