Health Care Reforms: Is It Saving Taxpayer Dollars

• Date: April 07, 2010
• Source: Admin

The recent healthcare reforms law by President Obama includes provision to decrease substantial taxpayer subsidies to private insurance companies that administer Medicare Advantage plans. This can be achieved by strengthening oversight, improving efficiency and tough provider screening which enable to identify fraud at the initial stages.

Medicare Advantage Overpayments: Ending Excessive Subsidies to Private Insurance Companies

Private insurance companies enjoy the advantage of getting almost 14% more in terms of cost paid in comparison to the traditional medical programs. Which in turn stresses the tax payers’ wallet by increasing premium and most importantly to seniors. This can be estimated to $12 billion a year.

With this new healthcare bill in picture it will have a better structure of payments which can eliminate the over payments and this is without cutting any guaranteed Medicare benefits. It is definitely aimed to increase the longevity of the program, reduce fraud and increase the efficiency to serve the tax payers. The different benefits which can be underlined in this arrangement are -

Because of the flawed payment formula the private insurers are getting paid more and which approximates to $132 billion and with this bill targeting this money by putting down a system which has benchmarks and it is linked to local medical spending on a sliding scale.

The other aspect is minimum of 85% of the premiums has to be spent on the clinical services and as these services improve directly the quality of healthcare it guarantees the enrollees a better and more efficient service. 

Obviously there are many private insurance companies which opposed the healthcare bill and some also has filled complaints in their local county.

Health care reform includes tough provisions attacking waste and fraud in Medicare and Medicaid

More funds are flowing in to the 2 program initiatives announced such as Health Care Fraud and Abuse Control Program and the Medicaid and Medicare Integrity Programs. This is a welcome step in fighting the fraud and will save a lot of tax payers money.

But to fight fraud there has to be constant monitoring and screening activity to catch the fraud at the beginning or before it can happen. This essentially needs better technology and data sharing between agencies so that fraudulent providers can be identified and a comprehensive database can be created which is available to the public.

Also as everything now going electronic  way there will be a small window for submitting Medicare claims and hence decreasing the chances of fraud by exposing it longer period of time. As it will be done electronic way there are less chances of human intervention and hence the chance of biasing the process can be minimized.

There is provision of tougher penalties for misleading marketing and enrolment in Medicare prescription drug benefit plans. Any kind of false statements, application or claims will be death with tougher actions.

Apart from screening the providers there will be enhanced site visits before the providers can start billing Medicare or Medicaid thus be reducing fraudulent providers to enter in to the fray.

Overall the set of new guidelines are aimed at decreasing fraud and strengthening the system by increasing oversight and proper methodology and usage of technology to its advantage. Hence it is welcome sign for the enrollees and not so for the fraudulent providers and also the other insurance companies will feel a small pinch in their profit margins which were very high before the bill.

To learn more about the Healthcare Bill and its impact on curbing insurance fraudulence, read the article in Insurance News Net.