Fraud and billing mistakes cost Medicare – and taxpayers – tens of billions last year

By Fred Schulte, Kaiser Health News 

Federal health officials made more than $16 billion in improper payments to private Medicare Advantage health plans last year and need to crack down on billing errors by the insurers, a top congressional auditor testified Wednesday.

James Cosgrove, who directs health care reviews for the Government Accountability Office, told the House Ways and Means oversight subcommittee that the Medicare Advantage improper payment rate was 10 percent in 2016, which comes to $16.2 billion.

Adding in the overpayments for standard Medicare programs, the tally for last year approached $60 billion — which is almost twice as much as the National Institutes of Health spends on medical research each year. (more…)

The cash-rich pharmaceutical lobby and the rising cost of drugs for Medicare seniors

By Stuart Silverstein, FairWarning 

President George W. Bush signing the Medicare Prescription Drug Improvement and Modernization Act of 2003.

President George W. Bush signing the Medicare Prescription Drug Improvement and Modernization Act of 2003.

When the Republican-controlled Congress approved a landmark program in 2003 to help seniors buy prescription drugs, it slapped on an unusual restriction: The federal government was barred from negotiating cheaper prices for those medicines. Instead, the job of holding down costs was outsourced to the insurance companies delivering the subsidized new coverage, known as Medicare Part D.

The ban on government price bargaining, justified by supporters on free market grounds, has been derided by critics as a giant gift to the drug industry. Democratic lawmakers began introducing bills to free the government to use its vast purchasing power to negotiate better deals even before former President George W. Bush signed the Part D law, known as the Medicare Modernization Act. (more…)

More Medicare Advantage audits in South Florida and elsewhere reveal overcharges

By Fred Schulte, Center for Public Integrity medicarecard

Government audits just released as the result of a lawsuit detail widespread billing errors in private Medicare Advantage health plans going back years, including overpayments of thousands of dollars a year for some patients.

Since 2004, privately run Medicare Advantage plans, an increasingly popular alternative to traditional Medicare, have been paid using a risk score calculated for each patient who joins. Medicare expects to pay higher rates for sicker people and less for those in good health. (more…)

How Medicare Advantage investors made billions off loose government lips

By Fred Schulte, Center for Public Integrity medicarecard

The third of February 2011 was mostly a ho-hum day on Wall Street­ — but not for companies offering Medicare Advantage plans. Several of those firms hit the jackpot, tacking on billions of dollars in new value after federal officials signaled they might go easy on health plans suspected of overcharging the government.

The stocks took off after the federal Centers for Medicare and Medicaid Services advised the health plans in a memo that it was rethinking a move to ratchet up audits of the privately run Medicare plans. Some of these plans are run by publicly traded insurance companies whose fortunes can rise and fall significantly upon news of a change in Medicare policy. (more…)

Humana facing new federal scrutiny over private Medicare plans

By Fred Schulte, Center for Public Integrity 

The entrance to Humana headquarters in Louisville, Kentucky

The entrance to Humana headquarters in Louisville, Kentucky

Giant health insurer Humana, Inc. faces new scrutiny from the Justice Department over allegations it has overcharged the government by claiming some elderly patients enrolled in its popular Medicare plans are sicker than they actually are.

The Louisville, Kentucky-based company disclosed the Justice Department’s recent civil “information request” in an annual report filed with the Securities and Exchange Commission on Feb. 18. The company noted that it is cooperating with authorities. (more…)

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