MEDICARE: Secretly Forgave Millions for Three Providers
In "secret" deals that violated their own rules, Medicare officials "improperly" forgave hundreds of millions of dollars owed them by providers in the three largest Medicare overpayment cases of the last decade, General Accounting Office investigators have found. Medicare officials said they had overpaid the three providers -- the New York City Health and Hospitals Corporation, the Visiting Nurse Service of New York and the Los Angeles County Health Department -- by a total of $332 million, but settled the cases for a total of $120 million, or 36 cents on the dollar. Investigators said the settlements were not reviewed by a federal lawyer as required by Medicare rules; instead, the government and provider in each case "agreed that the settlement would be kept secret" to avoid setting a precedent for other providers to follow.
Charitable Mission Justified Deals?
In their defense, Medicare officials said they had agreed to the low settlements because the providers in question served large numbers of poor patients. But the GAO accused officials of succumbing to the providers' "political influence," saying that top administrators, including former HCFA head Bruce Vladeck, had pressured subordinates to settle cases "after being contacted directly" by providers. Though investigators criticized Medicare officials acting "improperly" by accepting the settlements without appropriate scrutiny from government attorneys, they did not accuse the three providers of any wrongdoing. The Senate permanent subcommittee on investigations, which requested the review last May, will hold a hearing on the settlements tomorrow (Pear, New York Times, 3/26).