Senate raises concern over possible Medicare contractor conflicts

Three Senate committee chairmen asked the Department of Health and Human Services Inspector General on Tuesday to look into potential conflicts of interest among private sector contractors that perform many of the payment, administration and oversight functions of Medicare.

The senators--Tom Carper (D-Del.), Max Baucus (D-Mont.) and Claire McCaskill (D-Mo.)--said in their letter that a recent survey of contractors conducted by their staffs to examine problems within the Medicare program identified several relationships between key Medicare contractors "that raise questions about possible conflicts of interest, or at the very least, might present the appearance of a conflict of interest."

"We need a thorough examination of relationships between the contractors paying Medicare claims and their related corporate entities in charge of overseeing those same payments to make sure taxpayer dollars aren't being wasted," said Senate Finance Committee Chairman Baucus in a statement.

In some instances, the oversight contractor is a subsidiary of a company with a Medicare claims processing contract; in other instances, the claims contractor is a subsidiary of a parent company that also has a subsidiary with an oversight contract.

Congressional staffers said they have been reviewing the relationship of subsidiaries of WellPoint Inc., Hewlett Packard Co's EDS Corp., and several other Medicare contractors hired by the government to monitor the bills healthcare providers send to Medicare, according to media reports.  

For more information:
- read the Senate letter
- read the Reuters story