Sen. Carper Highlights State and Federal Governments’ Efforts to Combat Waste and Fraud in Medicare and Medicaid

Underscores Need to Pass FAST ACT to Help Curb Medicare Waste and Fraud

WASHINGTON – Today, Sen. Tom Carper (D-Del.) highlighted recent efforts by state and federal governments to curb waste and fraud in Medicare and Medicaid. Those efforts underscore the need for robust legislation to curb waste and fraud in Medicare and Medicaid, like Sen. Carper’s bipartisan bill, the Medicare and Medicaid Fighting Fraud and Abuse to Save Taxpayer Dollars Act (S.1251). Sen. Carper’s bill, also known as the FAST Act, would implement advanced tools and techniques to combat and reduce waste, fraud and abuse in Medicare and Medicaid.

Today, government witnesses at the House Oversight Subcommittee on Government Organization discussed the current levels of Medicare improper payments and highlighted additional opportunities to curb waste and fraud. At the hearing, the witnesses noted that the total improper payment levels for Medicare will rise because, for the first time, the federal government will tally billions of dollars in improper payments for the Medicare prescription drug program. The Government Accountability Office testified that the prescription drug improper payment number could be as high as $5 billion. Sen. Carper’s FAST Act legislation includes additional steps to curb prescription drug waste and fraud.

“The good news is that the federal government finally has a complete view of the problem, now that we are officially tallying improper payments for the Medicare prescription drug program,” said Sen. Carper. “Our next challenge is to find an effective way to prevent and recover the tens of billions of dollars lost annually to Medicare waste and fraud. We have taken many important steps since passing the Affordable Care Act and the Improper Payments Elimination and Recovery Act last year, but we still have a long way to go. My bipartisan legislation, the FAST Act, would put additional tools in place to not only identify improper payments, but also to prevent them from happening in the first place.”

Moreover, a recent state government effort in New Jersey recovered more than $116 million in Medicaid fraud and improper payments. The large recovery was due in part to the adoption of new cutting edge fraud and waste detection technology, which is now under implementation by the federal Medicare program. Last year, the Affordable Care Act also gave incentives to states for identifying overpayments, including a provision that would extend the length of time states have to repay the federal share of any Medicaid overpayments from 60 days of discovery to 1 year. Senator Carper pushed for this measure because, under the previous 60-day requirement, states did not have enough time to identify and recover improper payments. Sen. Carper’s FAST Act would build on the tools already provided to states in the Affordable Care Act, giving states more guidance to better identify and prevent Medicaid overpayments.

“Both the federal government and the states are beginning to make use of advanced technology and auditing techniques to detect fraud,” said Sen. Carper. “The New Jersey announcement shows that these technologies and techniques are a wise investment. If the federal government can show the same success, we could see billions of dollars in recoveries that will help shore up the Medicare trust fund.”

Sen. Carper’s legislation, the FAST Act would address a set of problems that leads to tens of billions of dollars lost to waste and fraud in Medicare and Medicaid every year. Among its provisions, the FAST Act would:

  • enact stronger penalties for Medicare fraud;
  • curb improper payments and establish stronger fraud and waste prevention strategies to help phase out the practice of “pay and chase”;
  • curb the theft of physician identities;
  • expand the fraud identification and reporting work of the Senior Medicare Patrol;
  • improve the sharing of fraud data across federal and state agencies and programs; and
  • deploy cutting-edge technology to better identify and prevent fraud.