A highly touted new technology system designed to stop fraudulent Medicare payments before they are paid has saved about $115 million and spurred more than 500 investigations since it was launched in the summer of 2011, according to a report released Friday.
Federal health officials said the projected savings are much higher. The savings so far, however, are minuscule compared with the estimated $60 billion lost each year to Medicare fraud. With the Obama administration and Congress desperately looking for savings to avoid a budget meltdown, denting Medicare fraud has the potential to save billions of dollars annually.
However, the Department of Health and Human Services' inspector general noted the report had some inconsistencies in its data and questioned the methodology for calculating some of the figures.
"In these cases, we could not determine the accuracy of the department's information, which impeded our ability to quantify the amount of the inaccuracies noted in this report," the inspector general's office said in a review of the report. Officials in the office said regardless of the glitches, they believe the new fraud system is a useful anti-fraud, too.
The $77 million technology system fights fraud in much the way credit card companies scan charges and can freeze accounts. It saved $32 million by kicking providers out of the program or refusing to pay suspicious claims. The report from the Centers for Medicare and Medicaid Services, obtained by The Associated Press, was unclear on how many actual providers were suspended or revoked from Medicare.
The rest of the money, about $84 million, is projected savings flowing from those actions. For example, if a fraudulent provider has been billing Medicare for roughly $100 million a year for wheelchairs that patients never receive and they are kicked out of the program, officials estimated the program would save $100 million the next year.
Medicare has been a highly sensitive political issue for the Obama administration since Democrats lost the House in 2010, partly due to a backlash from seniors over program cuts to help finance the president's health care overhaul. Since then, top officials have emphasized the administration's stewardship of Medicare, pointing to better benefits and an all-out campaign against fraud.
Lawmakers from both parties, including Sen. Tom Carper, D-Del., and Sen. Orrin Hatch, R-Utah, have pressed health officials for months to release results on the system, complaining that without data, there's no accountability for the money spent and the promises made.