Medicare Program Overpaid Billions Last Year

January 27, 2014

Medicare's Private Fee-For-Service Plans overpaid $34.6 billion in 2013, says the Fiscal Times.

  • Medicare's Fee-For-Service (FFS) program alone has a 10.1 percent "improper payments" rate, and it is only one of several government programs that have wasted billions of dollars each year.
  • More than $100 billion is wasted annually by 13 of the largest federal programs.

The Centers for Medicare and Medicaid Services, which runs the FFS program, can recover these overpayments when they try -- in fact, they recovered 83 percent of funds they identified as having been paid improperly. However, CMS only identifies 0.1 percent of improper payments each year. That's only one one-thousandth of the total amount.

  • To get a sense of just how much money the FFS program overpaid last year alone, $34.6 billion is nearly equal to the entire Department of Justice budget.
  • In fact, those wasted funds could have funded the Department of Commerce, the Environmental Protection Agency, all civil works projects by the Army Corps of Engineers, and the National Science Foundation combined, and there would still be $1 billion left over.

With the proven ability to recover overpayments, it is puzzling that more effort is not being made to recover the rest of the funds.

Source: Rob Garver, "Medicare Execs Are Overpaying $35 Billion a Year...And They Don't Seem to Care," Fiscal Times, January 21, 2014.

 

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