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You Pay for Medicare Waste, Fraud, and Abuse

One in four Americans, approximately 79 million beneficiaries, relies on the federal health insurance programs of the Centers for Medicare and Medicaid Services (CMS). Medicare is the CMS program that pays for many of the health care expenses of almost 40 million older and/or disabled Americans. Medicaid is the CMS program that provides health care coverage for low-income Americans serving more than 40 million persons this year.

The current CMS budget is approximately $429 billion. This makes it second only to Social Security ($512 billion) in the level of federal spending. If you add Medicaid State matching funds to federal funding, the total 2003 CMS budget of approximately $549 billion exceeds that of Social Security. Although that's a lot of money, it is not the bottomless pit of money that most people expect to always be there when we need it.

Unfortunately, a significant proportion of each health care dollar goes not for the provision of health care, but to criminal enterprise. The federal government's General Accounting Office (GAO) estimates that for every $10 spent on Medicare, $1 is lost to errors, waste, and intentional fraud. A January 2003 GAO report also placed Medicaid on a list of government programs at "high risk" of fraud, waste, abuse or mismanagement.

Although the vast majority of doctors, pharmacists, insurance companies and home health care providers are honest, about one to two percent are not and have figured out dozens of ways to cheat the system – over-billing, billing for work not performed, charging for equipment never used, providing a less expensive generic drug and charging brand-name price for many others. These highly skilled health care criminals are threatening the integrity of our health care delivery system while enriching themselves at taxpayers’ expense. That means you, the taxpayer, are paying for all those services advertised as “free” to Medicare beneficiaries. Whether or not you are a Medicare or Medicaid beneficiary, you pay for waste and fraud through increased annual insurance deductibles and monthly premiums. All of us pay when escalating health care costs lead to higher taxes.

During the recent Arkansas General Assembly, budget shortfalls threatened to cut Medicaid services to our most vulnerable citizens. Advocates and consumers rallied at the capitol almost daily while legislators wrestled with proposed tax increases to fund critically needed services. Considering that our Medicaid-eligible population increases every year, we need to actively pursue measures that will stop fraudulent practices from draining our budget-limited Medicaid dollars. We should also recoup Medicaid dollars already lost to waste, fraud and abuse.

ASMP TIP OF THE MONTH: Never give your Medicare number to anyone offering, "free Medicare services." Medicare services are never free, and your doctor must always prescribe them. Think about it. If services are advertised as "free," why would anyone need your Medicare number? Your Medicare card is the most valuable credit card you will ever have. Putting your number in the hands of health care criminals allows them to access the largest credit limit in history, and it also makes you a victim of Medicare fraud.

The Department of Human Services (DHHS), together with the Arkansas Attorney General’s Medicaid Fraud Control Unit and the Area Agencies on Aging, will use federal grant funding to train and support a group of retired volunteers called the Arkansas Senior Medicare/Medicaid Patrol (ASMP). By working with retired professionals — doctors, nurses, accountants, investigators, law enforcement personnel, attorneys and teachers — they can become experts and educators on the recognition and reporting of inappropriate use of Medicare and Medicaid funds.

ASMP volunteers will train their peers at churches, senior centers and clubs or one-on-one. They will distribute informational brochures to Medicare and Medicaid beneficiaries to help them understand their explanation of benefits (Medicare Summary Notice) and recognize billing errors, charges for services not rendered and intentional fraud.

Special efforts will be made to involve large employee-assistance programs to educate family caregivers of Medicare and Medicaid beneficiaries, and to reach out to minority populations, people with disabilities, and nursing home residents.

Reporting of inappropriate charges and billing discrepancies will be facilitated through a new toll-free phone number, 1-866-726-2916, maintained by the Division of Aging and Adult Services (DAAS). Information on ASMP Project outreach activities and volunteer recruitment will also be accessible to both volunteers and the public on an ASMP web page on the DAAS website. This web page is scheduled to be up next month.

Future articles will discuss how to recognize Medicare and Medicaid fraud and provide tips on preventing waste, fraud, and abuse. We will walk you through reading your Medicare explanation of benefits and familiarize you with what services are covered by Medicaid. We will also include information on upcoming volunteer training sessions at the three participating Area Agencies on Aging (AAA) These are:

Empowering citizens to monitor their own health care costs will a powerful tool to combat the waste, fraud, and abuse the reduces the funds that could help provide critically needed care. The Office of Inspector General of the Health and Human Services Department recently announced $12 billion in recoveries the first half of this year.

We all need to become better health care consumers and to take an active role in ensuring that Medicare and Medicaid will continue to exist for future generations. After all, it’s our money.

Sharon Marcum is the grant administrator of the ASMP project and can be reached by phone at DAAS in Little Rock at 501-682-8504 or by E-mail.