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Wednesday, September 12, 2007
Medicare's Auditing Priorities
There was an interesting article in the NYT about Medicare overpayments to insurance companies, many of which are a part of the Medicare Advantage plans that the House proposed to trim.
In 2003, Medicare audited 49 of the 220 organizations participating in the program. Auditors found significant errors at 41 companies, but Medicare officials took no action on the findings. As a result of the errors, the auditors said, insurers kept "$59 million that beneficiaries could have received in additional benefits, lower co-payments or lower premiums." The report did not identify the companies.
While Medicare isn't pursuing cases of overpayment that its own auditors identify, it is aggressively pursuing Medicare beneficiaries who owe premiums to insurance companies.
In separate action, the Bush administration is vigorously pursuing money that it says is owed to insurance companies by Medicare beneficiaries. The Medicare agency has sent letters to more than 135,000 people saying they still owe premiums for prescription drug coverage provided in 2006. In most cases, the premiums were supposed to have been withheld from monthly Social Security checks, but the government withheld the wrong amounts or nothing at all.
This inconsistency is not unlike how the government audits the largely low-income people who get the Earned Income Tax Credit. They're audited almost twice as often as the wealthiest are. But audits on EITC returns get a return of nearly 1/20th the size (check out the IRS Databooks to see for yourself)
The IRS could go after more wealthy taxpayers who don't pay. But instead of Congress giving them the resources they need to do that, they hired private debt collectors to track down taxpayers who owe small debts to the IRS, people who are typically low to middle income.
These are conservative good government principles in action: pick on the little guy and let the big guys off, while the public is left holding the bag.
Posted by Matt Lewis
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