President Clinton said he will ask Congress to approve tougher rules for Medicare providers in an effort to reduce fraud and abuse, just as the Health and Human Services and the Justice Departments announced they recovered $1.2 billion in fiscal 1997 from Medicare scam artists.
In his weekly Saturday radio address, Clinton said the proposals he will include in his fiscal 1999 budget, which is scheduled for release Feb. 2, would save Medicare more than $2 billion a year. Provisions include making health care providers pay for their audits, requiring that fly-by-night providers who go bankrupt pay their Medicare debts before any other debts, and increasing oversight to reduce the number of claims Medicare pays that should be covered by private insurers.
In addition, Clinton will ask for a change to the pricing structure used to pay Medicare claims. Health and Human Services Secretary Donna Shalala said Friday at a White House briefing that Medicare should be permitted to pay market prices for health care goods and services, like the Defense Department and the Department and Veterans Affairs can.
"When the Medicare program was first put together, people were so nervous that the doctors and the suppliers wouldn't come into the system that they locked in a pricing structure that makes absolutely no sense in this competitive market," Shalala said. "We want to be able to go out into the market and pay appropriate prices--market prices."
Fraud and abuse in the Medicare system has become a major issue for the Clinton administration and Congress. In fiscal 1997, HHS and the Justice Department collected about $1.2 billion in fines and settlements from fraudulent businesses and individuals, more than in any previous year, the administration announced this weekend. More than 2,700 health care providers and businesses were excluded from doing business with Medicare and other government health care programs because of fraudulent activities.
The federal agencies who contributed to the fraud crackdown, including the HHS inspector general's office, the FBI, the Justice Department, and the Health Care Financing Administration, funded their efforts through a congressionally created account for fraud and abuse control. The additional funding, which came to $104 million in 1997, allowed the HHS inspector general to open six new field offices and will fund a new database to prevent fraudulent health care providers from repeating their crimes. Numerous anti-fraud provisions were also included in the 1996 Health Insurance Portability and Accountability Act and the 1997 Balanced Budget Act.
Medicare is expected to be a primary topic in Clinton's State of the Union address Tuesday night, as Congress and the administration struggle to develop a plan to extend the life of the Medicare program. A 17-member commission led by Sen. John Breaux, D-La., was created earlier this month to come up with a plan to maintain Medicare's solvency.
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