Medicare Paying for Health Care for the Dead

WASHINGTON — Senate Governmental Affairs Committee Chairman Fred Thompson (R-TN) today expressed concern that “Medicare is paying providers millions of dollars for services that were allegedly performed after the patients had died.” The findings Senator Thompson refers to are detailed in two recent reports by the Inspector General (IG) for the Department of Health and Human Services (HHS).

“Like other federal programs, Medicare does suffer from difficult, complex management problems,” said Thompson. “But in this case, Medicare has the ability to easily match claims with death notices ? they just don?t bother to run the match.”

Based on a one percent sample of all Medicare claims, the HHS IG found that the Health Care Financing Administration (HCFA) paid $20.6 million for Medicare equipment or services provided to beneficiaries after they died. In another case, the IG discovered that HCFA was paying HMOs on behalf of enrollees who have been dead for some time, and continues to make such payments for some who died as long ago as 1993.

In many cases, HHS? own records contained death notices for these individuals yet, it paid more than $8 million in improper claims supposedly for them. In other cases, HHS had not yet obtained death information at the time many of these claims were processed.

HHS agrees with the IG findings and says it has developed an action plan to deal with them. “While I?m pleased that HHS recognizes this problem and is trying to fix it,” Thompson said, “it should have been fixed long ago,” said Thompson. “Stopping payments to providers who claim to be providing services to people who are deceased isn?t rocket science, especially when your own records show they?re deceased. These improper payments – many of them the result of fraud – take health care dollars away from those who need them.”

On November 5th of last year, Chairman Thompson released a General Accounting Office Report he requested which identified $19.1 billion in improper payments in just 14 programs administered by nine federal agencies. Chairman Thompson has since written to Office of Management and Budget Director Jack Lew urging OMB to take steps to slash the improper payments. Last year alone, improper Medicare payments amounted to $ 13.5 billion, or about 8 percent of the entire Medicare budget.

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The above-mentioned HHS IG reports are:

Review of Payments to Medicare Managed Care Risk Plans for Deceased Beneficiaries, February 2000

Report A-07-99-01283

Medicare Payments for Services after Date of Death, March 2000

Report OEI-03-99-00200