Medicare loophole must be plugged ASAP

The nation's nursing homes were able to collect $2.1 billion despite a change in the rules aimed at cutting costs.


When taxpayers are getting ripped off, whether it's $100 or $100 billion, officials have an obligation to put an end to it and recover the cash.

Yet, taking action is often difficult because uncovering fraud or mistakes is expensive, time consuming and difficult to prove.

We believe it is in the public's best interest to go after those who intentionally or mistakenly take taxpayers' dollars. It's a matter of principle.

When billions are at stake -- as seems to be the case with a loophole in Medicare rules -- action should be swift.

Bloomberg News recently reported a loophole in Medicare rules resulted in the nation's nursing homes collecting an additional $2.1 billion in federal payments in the first six months of the year.

A report by the Department of Health and Human Services inspector general found that overbilling was an unintended side-effect to a rule change aimed at clamping down on overbilling, according to Bloomberg News, which obtained a copy of the report.

Medicare attempted to block companies from assigning therapists to treat groups of patients simultaneously and then bill each individual for the total time of the session. This intent of the change would seem prudent.

But nursing home operators responded by reclassifying patients in smaller group settings and still billed the government as if therapy was provided on a one-on-one basis, according to the unpublished report. Medicare gave the OK. The report recommended the federal government block further overpayments.

The report called for the agency to "take immediate action."

Medicare pays between $430 to $699 a day for nursing-home patient therapy. Taking an end run around this new rule allowed the nursing homes to bill at the highest rate, according to the report.

It would seem plugging this loophole would be a no-brainer.

Yet, for-profit nursing homes argue that Medicare should keep paying them under the current system until the end of the year to figure out exactly how the new system got off track.

"We know that the sector was overpaid," said Mark Parkinson, chief executive officer of the American Health Care Association, the Washington lobbying group for for-profit nursing homes. "All parties also know that there's no way to know the exact amount of overpayment. With all of the other changes (in the U.S. health system overhaul) going on, it's probably best not to make these additional changes."

Best for whom? Certainly not the taxpayers.

The loophole should be closed and the overpayments stopped. It's possible this money won't have to be paid back, given that officials did approve payments, so it's critical to stop overpaying as soon as possible.


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