$54.2 Billion Spent on Medicare Fee-for-Service Errors in 2009

Peter Orszag, Director of the Office of Management and Budget, reported that Medicare and Medicaid spent $54.2 billion in improper payments in 2009. Orszag also reported that the rate of Medicare fee-for-service errors doubled in the past year.

Orszag attributes the doubled rate to a new system of counting errors, which counts incidents such as an illegible signature or submitting a claim without sufficient documentation as errors.

To address this problem, President Obama will issue an executive order requiring greater agency oversight, the creation of a website that allows the public to track and report improper payments, and penalties for those who do not return payments received in error.

This is another example of how billions of dollars are being spent with no contribution to improving healthcare. As healthcare reform continues to develop, let's hope that the government figures cost-effective ways to improve the administrative side of healthcare delivery and increase accountability for errors. $52.4 billion could go a long way toward patient-centered improvements.

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Source: Modern Healthcare