The CMS said fraud, abuse and errors in Medicare fee-for-service bills dropped to 5.2% of billings, or $12.1 billion, in fiscal 2005 from 10.1%, or $21.7 billion, in fiscal 2004. CMS Administrator Mark McClellan credited increased oversight, data review and provider education.
The error rate was based on a review of more than 160,000 Medicare claims. The fee-for-service program pays more than 1 billion claims annually. In the first study of Medicare error rates, in 1996, the government estimated 14.2% of claims, or $23.8 billion, were tainted by fraud, abuse or error. McClellan said the CMS will apply a similar data-driven review process to Medicaid fee-for-service claims in 2006 and expand its review to Medicaid managed-care and State Children's Health Insurance Program claims in 2007. The agency has requested $720 million for its Medicare integrity program and $80 million for other oversight programs in 2006.
Separately, McClellan said the CMS signed a Medicaid waiver with Louisiana increasing federal aid for the state's Medicaid program. He said the federal government is covering 70% of the hurricane-damaged state's Medicaid costs and is working with Congress to offer more assistance.