Faulty Medicare payments hold steady

Sunday, January 26, 2003

January 27, 2003

WASHINGTON - Improper Medicare benefit payments made during 2002 totaled $13.3 billion, or about 6.3 percent of the $212.7 billion in processed fee-for-service payments reported by CMS, according to a new report by the OIG.

As a rate of error, the current 6.3-percent estimate is the same as last year's rate-which was the lowest to date and less than half the 13.8% reported for FY 1996.

These improper payments, as in past years, could range from reimbursement for services provided but inadequately documented to inadvertent mistakes to outright fraud and abuse. The 2002 estimate of improper payments is significantly less than the $23.2 billion that the OIG estimated for 1996, the first year it compiled the statistics.

The OIG attributes decrease in errors to:

- Increased vigilance by CMS in monitoring the error rate and developing appropriate corrective action plans.

- Increases adherence by provider to Medicare reimbursement rules. Since FY 1998, over 92 percent of Medicare fee-for-service payments have contained no errors.

- Successful fraud and abuse initiatives by CMS, Congress, the DOJ, and OIG have had a significant impact.