White House Takes Aim at Medicare and Medicaid Billing Errors

In a previously unreleased letter, Office of Management and Budget Director Shaun Donovan told the Department of Health and Human Services to devise an action plan for reducing wasteful Medicare and Medicaid payments. White House budget director Shaun Donovan called for a “more aggressive strategy” to thwart improper government payments to doctors, hospitals, and insurance companies in a previously undisclosed letter to Health and Human Services Secretary Sylvia Mathews Burwell earlier this year. Government health care programs covering millions of Americans waste billions of tax dollars every year through these improper payments, Donovan said in the Feb. 26, 2015 letter. Donovan went on to say that “we must continue to explore new and innovative ways to address the problem and attack this challenge with every tool at our disposal … .” Donovan cited problems with traditional Medicare, which pays doctors and hospitals on a fee-for-service basis, as well as Medicare Advantage, its fast-growing, privately run alternative. The private insurance plans are paid a set fee each month for each patient using a billing tool called a risk score. The White House budget chief also noted in his letter that payment errors rose by $3.1 billion last year in Medicaid, the government health care plan for lower income people, which is jointly funded with the states.

Source/more: NPR