Medicare Losses Unrecoverable, Says Inspector

The government has no chance of recovering any significant amount of the $23 billion lost by Medicare each year through waste, fraud and abuse, the inspector general of the Department of Health and Human Services warned Thursday.

HHS’s 590 Medicare auditors are far too few to cope with the 800 million Medicare bills that the department processes annually, June Gibbs Brown told a congressional hearing. She said the government would probably be able to retrieve “far less than 1 percent” of that money.

Congress slashed the number of auditors in 1991, according to HHS officials, even though Medicare is the government’s fastest-growing program. Only 8 percent of claims are audited, down from 16 percent a decade ago, Bruce Vladeck, the chief Medicare administrator, told the House Ways and Means subcommittee on health.

Medicare has recovered more than $187 million in the past two years through a program to detect fraud, Vladeck said.

The results of Medicare’s first formal audit left subcommittee members angry and frustrated. The $23 billion in annual losses discussed by Brown is coincidentally equal to the amount of savings Congress is seeking to carve from Medicare spending for each of the next five years as part of its effort to rescue the program from potential bankruptcy and balance the federal budget in five years.