Keeping the Promise: Subcommittee Reviews Administration’s Failures to Address Inefficiencies and Fraud in Medicare

March 4, 2014

WASHINGTON, DC – The House Energy and Commerce Health Subcommittee, chaired by Rep. Joe Pitts (R-PA), today discussed opportunities to improve the management of the Medicare program and what immediate steps should be taken to address waste and fraud in the program. Today’s hearing, “Keeping the Promise: How Better Managing Medicare Can Protect Seniors’ Benefits and Save Them Money,” also emphasized the fact that these steps, while important, will not be enough to save Medicare’s fiscal future and protect the promise the Medicare program has made to America’s seniors.

Energy and Commerce Committee Chairman Fred Upton (R-MI) underscored the fiscal uncertainty facing Medicare, stating, “As we have warned many times, the financial sustainability of Medicare is under serious threat, putting the access to and quality of care for current and future seniors in jeopardy. The Medicare Part A trust fund is expected to run out as soon as 2017, while the cost of the entire Medicare program is projected to reach a trillion dollars each year by the end of the decade.”

Subcommittee Chairman Pitts added, “While reducing waste, fraud, and abuse – and managing the program more effectively – should be an administration priority, that alone is not enough to address Medicare’s spending problem. However, critics are correct that a Congressional solution is needed. We must do everything in our power to safeguard the money in the Trust Fund, until such time as Congress accepts its responsibility to make structural changes to save the program for the millions who depend on it.”

During the hearing, Rep. Phil Gingrey, M.D. (R-GA) asked, “If we could eliminate every dime of waste, fraud, and abuse…do you think that that would save Medicare for future generations?” Kathleen King and James Cosgrove, Directors of Health Care at the Government Accountability Office, both answered “no,” explaining more would need to be done to keep the promise for future seniors.

The Department of Health and Human Services Office of the Inspector General today released two new reports in conjunction with the hearing which found, “CMS has not: leveraged contractor-reported data to improve oversight; investigated variation in data across contractors to determine underlying causes, especially when it is not explained by the size or geographical jurisdiction of contractors; addressed underperforming contractors timely and required corrective actions for all performance standards that were not met; or shared information with beneficiaries and other stakeholders that could assist anti fraud efforts.”

Robert Vito, Regional Inspector General for HHS OIG, explained, “This would be like taking your car to a mechanic, having them run diagnostic tests, and then not using the test to determine if your car is running well and safe to drive.

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