Lawmakers Introduce Bill to Ease HCFA Fraud and Abuse Enforcement Process

Supported by a number of groups representing health care providers, Sens. John Kerry (D-Mass.) and Frank Murkowski (R-Alaska) on March 7 introduced legislation -- the Medicare Education and Regulatory Fairness Act (S452) -- that would revamp Medicare audit procedures, CongressDaily/A.M. reports (Rovner, CongressDaily/A.M., 3/8). This happens one day after HCFA received its second consecutive clean audit opinion and HHS announced that the Medicare payment error rate in 2000 was less than half of the 1996 rate (Kaiser Daily Health Policy Report, 3/7). Among other things, the bill would prevent the agency from recovering "past overpayments by withholding future payments" and prohibit the government from prosecuting providers who "voluntarily disclose" overbilling errors and return the payments within one year "when fraud is shown" (Murkowski release, 3/7). In addition, the legislation would require HCFA to educate providers about proper billing procedures (Anderson, States News Service/Worcester Telegram & Gazette, 3/8). The bill would also "limit" HCFA's use of "extrapolation," a process in which the agency assumes billing errors found on sample audits were made regularly and increases repayment amounts accordingly. Thomas Reardon of the American Medical Association said, "This is similar to the IRS identifying an error on your most recent tax return and making the assumption that you made the same error on every return you ever filed -- and then requesting back taxes on each and every return" (Rovner, CongressDaily/A.M., 3/8). Reps. Patrick Toomey (R-Pa.) and Shelley Berkley (D-Nev.) have proposed a similar measure in the House. "All of us here recognize the need to ferret out waste, fraud and abuse. But we also have an obligation to ferret out stupidity and abusiveness," Kerry said (Rovner, CongressDaily/A.M., 3/8). Saying HCFA is sometimes an "out-of-control bureaucracy," he added, "I think it has been excessive in the way it has squeezed some of our providers" (Powell, Boston Herald, 3/8). HHS reported that in 2000, there were $11.9 billion in improper Medicaid payments (Kaiser Daily Health Policy Report, 3/7).