Coats: Improper Payments Account for 10% of Medicare Spending

WASHINGTON, DC – Senator Dan Coats (R-Ind.), chairman of the Joint Economic Committee, today delivered his 47^th Waste of the Week speech and highlighted $59 billion in improper Medicare payments. Coats said improper payments are payments that are not justified and can occur because of fraud or bureaucratic mismanagement. In fiscal year 2015, the Centers for Medicare and Medicaid Services (CMS), which administers Medicare, improperly paid out $59 billion for health services.

“CMS is one of the worst offenders in the federal government for improper payments, totaling $59 billion in a single year,” said Coats. “To put this in perspective, $59 billion represents nearly 10 percent of the total amount Medicare spent that year.”

Last month, the Medicare trustees projected that Medicare Part A will be insolvent by 2028.

“The mismanagement of Medicare is no longer an issue that will have to be dealt with only by young Americans,” Coats continued. “Within 12 years, hardworking Americans who are already retired, or are close to retirement, will be likely faced with the harsh reality of a bankrupt Medicare program, unless we reform it. Twelve years is not much time for current and future retirees to plan and budget for health care alternatives separate from a bankrupt Medicare program.”

Coats highlighted a group known as the Medicare Fraud Strike Force as an example of how to root out the bad actors in Medicare and bring them to justice. Recently, the Strike Force uncovered a ring of over 300 people – from physicians and pharmacists to nurses and government officials – that allegedly conspired to defraud Medicare out of over $900 million. Some of the practices of this fraud ring include billing Medicare for procedures the providers claim took place after the patient passed away. Other providers billed Medicare for home health care, which is reserved for bedridden seniors, for services that were not even provided to the patients in need.

“I continue to urge my colleagues in the Senate, House and Obama Administration to take the necessary steps to tighten the screws on the bad actors in Medicare – not only because they are gambling with the health of some of America’s most vulnerable patients, but also because we have such little time to work with to save this vital program,” said Coats. “We can protect seniors, promote good government practices and achieve real savings by addressing this issue now.”

Click here to watch Coats speak on the Senate floor.