Wednesday, November 18, 2009

Improper US Government Payments Hit $98 Billion

As the nation continues to debate the House of Representatives health care reform bill, new statistics have emerged showing that improper payments made by the federal government to people, firms, and contractors rose to $98 billion this year. Over half of the errors were reportedly made in the Medicare and Medicaid programs, which according to Budget Director Peter Orszag, shows the need for some type of health care reform.

Improper payments in the Medicare and Medicaid programs totaled $55 billion in fiscal 2009, according to documents provided by OMB.

Medicare covers healthcare for the elderly and some disabled, while Medicaid does the same for the poor.

Orszag said the error rate for payments under Medicare Advantage, where private insurers offer coverage to Medicare beneficiaries, jumped to 15 percent, or to $12 billion, in fiscal 2009. The error rate was 10 percent in fiscal 2008.

"This was not the result of methodological changes. This is one of the reasons why, as part of health reform, we believe there are crucial changes necessary to the Medicare Advantage program," he said on a telephone conference call.

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