Inspector general notes weak anti-fraud results

Medicare contractors responsible for finding fraud and recovering overpayments have lackluster and uneven track records, according to two new reports by HHS' inspector general's office. Just 7%, or $55 million, was recovered by claims processors from about 4,200 overpayments totaling $835 million referred by Medicare's 18 program safety contractors in 2007, according to one of the reports.

Claims processors are supposed to get the government's money back by withholding future payments or demanding refunds. For more than 1,000 of the overpayments the program safety contractors say they identified, worth $58 million, the claims processors say they never received the referral or couldn't provide any information about collection efforts. A second report concludes that only two of the program safety contractors were responsible for referring 62% of the $835 million in overpayments.

The top referrers covered territory that included at least one state identified as a hot spot for Medicare fraud, but others covering similarly vulnerable areas came up with much less. The CMS is replacing program safety contractors and consolidating fraud-fighting efforts in the hands of a smaller number of contractors, called Zone Program Integrity Contractors, or ZPICs. In a response to the inspector general's findings, acting CMS Administrator Charlene Frizzera wrote that the transition to ZPICs and additional reporting required of contractors since 2007 should improve the agency's tracking and recovery of overpayments.