As the U.S. Senate weighs a 2,074-page health-care “reform” bill, supporters of a government option for medical coverage consider this the finest federal initiative since the Emancipation Proclamation. Yet today’s headlines show government severely bungling its current health-care duties. Expanding Uncle Sam’s medical portfolio is a prescription for fraud, fiscal incompetence, and rampant mismanagement on the clinical frontlines.
Fraud devours some $60 billion — or 13.3 percent — of Medicare’s $452 billion budget. “Rather than stealing $100,000 or $200,000,” federal prosecutor Kirk Ogrosky said on October 25’s 60 Minutes, criminals “can steal $100 million.”
One thief named “Tony” told CBS’s Steve Kroft that he robbed $20 million from Medicare. It was “real easy,” “Tony” said. “It was like taking candy from a baby.” He registered bogus medical companies, bought stolen doctor and patient ID numbers, and then billed Medicare for phantom wheelchairs, phony artificial limbs, and more. Medicare soon delivered $20,000 to $40,000 electronically into “Tony’s” bank account — daily.
Kroft said his findings raise “troubling questions about our government’s ability to manage a medical bureaucracy.”
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Sen. Charles Grassley (R., Iowa) recently found that Medicare administrators received 30 serious fraud warnings over three years, primarily during the Bush administration, and simply ignored half of them. Medicare failed to investigate complaints that it reimbursed one company for injected drugs “at doses that were not medically feasible,” one letter explained. Rather than the proper $74 per dose, Medicare sent this provider $4,464.
Another recent report uncovered $18.1 billion in improper Medicaid payments, or 9.6 percent of that program’s claims.
Lacking the “evil and greedy” private insurers’ profit motive, Medicare managers have no incentive to uproot such malfeasance. Medicare staffers rarely are corrupt; but with their pay and promotions not tethered to any bottom line, they have little reason to worry about who gets paid what.
Michael McGaughan observed in the November 13 Pantagraph.com that the top 14 health-insurance companies earned aggregated profits of $8.6 billion last year on combined revenues of $275.6 billion, according to the May 4 Fortune. This translates into 3.12 percent in “greedy” profits in the private option versus 13.3 percent fraud in the public option. Greed suddenly looks pretty good.
Meanwhile, doctors routinely wait and wait to get paid less and less by Medicaid. According to Athena Health’s PayerView report, North Carolina is the fastest state Medicaid system, paying doctors in 40.6 days. Still, it lags Coventry Health Care, a private insurer and the eighth-fastest of eight “national payers” that Athena measured. Coventry needed 38.5 days to issue checks. (Medicare Part B was ranked fifth among “national payers” at 33.4 days.) Among 14 state Medicaid systems that Athena rated, six take 77.7 to 89.7 days to pay. Medicaid of New York is the biggest deadbeat, averaging 160.9 days (or nearly six months) before whipping out its checkbook.
