New reforms will help fight Medicaid fraud

A recent state financial audit found that the Illinois Medicaid system paid out $12 million in healthcare benefits for people who had died. The report showed that over 8,000 dead people, including some who passed away 25 years ago, were still on the rolls and receiving state-funded premium payments.

This embarrassing waste of taxpayer dollars is only the tip of iceberg. Medicare and Medicaid have become so bloated and bureaucratic that they lose upwards of $60 billion annually to fraud and improper payments, which ultimately raises healthcare costs for the millions of Americans who depend on them.

My colleagues and I in the House have been working to find solutions to repair Medicare and Medicaid by fighting back against rampant waste, fraud and abuse in the programs.

Last week, President Obama signed into law H.R. 2, which includes several key provisions of my bipartisan Medicare bill, the Preventing and Reducing Improper Medicare and Medicaid Expenditures (PRIME) Act, which strengthens these programs and eliminates vulnerabilities that expose them to costly scams.

State-run Medicaid and federally run Medicare both suffer widespread fraud by healthcare providers and beneficiaries who submit faulty claims to scam the system. And yet there is no uniform system in place that allows the programs to share instances of suspicious claims and schemes. This enables providers or beneficiaries who cheat one program to go on stealing from the other, even if they have been caught and punished.

Currently, only 21 states participate in the Medicare and Medicaid Data Match Program, or Medi-Medi, which enhances information sharing about suspected fraudsters between the two programs. The PRIME Act requires the Department Health and Human Services to develop a plan to incentivize more states to participate in Medi-Medi - a commonsense reform that will strengthen fraud prevention at the state and federal levels.

Medicare is particularly susceptible to waste and abuse due to its outdated "pay and chase" payment system, which remits Medicare reimbursement without first checking for fraud or errors, leaving federal agencies to track down these improper payments after they go out the door.

Failing to properly vet claims on the front end wastes billions of dollars in the form of duplicative reimbursements or overpayments. Implementing the PRIME Act will phase out this antiquated "pay and chase" practice and replace it with a modernized, real-time fraud detection system to prevent erroneous payments from occurring in the first place.

Washington has a tendency to avoid difficult problems until it's too late to fix them, but ignoring deficiencies in Medicare and Medicaid - both of which are on a steady path to bankruptcy due to rising costs and a ballooning fraud rate - will only make these problems worse and jeopardize their long-term solvency.

That's why I'm proud that these common-sense reforms to help fix our critical healthcare safety-net programs for seniors and save billions of taxpayer dollars are now the law of the land. Even during these challenging times, Democrats and Republicans agree that legislation like PRIME Act is an important step toward making healthcare fraud a thing of the past.

U.S. Rep. Peter Roskam is a Republican from Wheaton representing the 6th Congressional District.