GAO: Medicare HMOs shouldn't have kept money

A new audit by the Government Accountability Office has found that private health plans contracting with Medicare are keeping money which they're supposed to either return to the government or pass along to beneficiaries. The extra money, which comes from cost savings, is supposed to be shared with CMS and consumers. However, according to the audit, Medicare HMOs have been allowed to keep tens of millions of dollars that they should have turned over.

This has happened, in part, because CMS hasn't been auditing Medicare HMOs aggressively, the GAO said. In theory, CMS was supposed to audit one-third of Medicare HMOs each year, but it hasn't been doing so. It audited only 24 percent in 2001, and that number had fallen to 14 percent by 2006.

To learn more about the GAO report:
- read this article from The New York Times

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