Legisltative Impact on Medicare

Legislative and regulatory issues and pressure have had a tremendous impact on Medicare providers, beneficiaries, and taxpayers. Subsidized by the government and American taxpayers, the current and future financial state of Medicare availability and coverage is in the forefront in governing bodies and across the entire country. The government is in charge of regulating cost saving strategies to ensure a sustainable life for Medicare through constantly changing policies and procedures impacted through federal laws. The most notable examples of legislative and regulatory impact on fee for service programs, such as Medicare, are fraud, overpayments, fee schedules, and health care reform.
Medicare fraud is a felony crime that is punishable at a minimum sentence to five years in prison. Most payment errors are simple errors by providers, however some individuals, organizations, and providers try to abuse the system. Several statues exist through state and federal legislation to punish knowing and willingful fraudulent parties, including the most common acts: false claims act, false statements act, social security act, and federal mail and wire fraud.
“Overpayment to physicians and providers by Medicare is not uncommon, and generally, overpayments result when payment is made by Medicare for non-covered items or services that exceed the amount allowed by Medicare for an item or service, or when payment is made for items or services that should have been paid by another insurer” (Moran, 2007). Amendments to the Social Security Act, S. 452, section 202, enacted in 2003, allows providers that have received overpayments from Medicare to return the overpayment amounts within 1 year without accruing interest. Under S. 452, section 103, overpayments exceeding $5,000 can be paid back over a 3 year period. Any overpayments falling outside the regulations of the amendments are subject to 13.75 percent interest and knowingful non repayments are subject to fraudulent Medicare laws (Baucus, 2001).
Medicare’s fee for service payment model evaluates, publishes, and controls reimbursement amounts for all services according to procedure code. “To control spending the SGR system sets spending targets for the year and adjusts physician fee services to fall below lower than inflation in the cost of operating a medical practice. A wide enough gap between spending and the target results in fee reductions” (GAO, 2004). Physician groups having grown increasing dissatisfied with the governments right to update fees, resulting in decreasing reimbursement rates. “Since the introduction of the fee schedule in 1992 through 2001, physicians generally experienced real increases in their fee updates. Fee updates increased more than the increase in the cost of providing physician services, as measured by MEI. Fee updates increased by 39.7 percent, whereas MEI increased by 25.9 percent, resulting in a higher increase of providing medical services and considerably lower increase of Medicare reimbursement fee schedules” (GAO, 2004).

Current United States government administration is further impacting health care with health care reform. Proposed plans to subsidize all health insurance plans to all American citizens will increase legislative and regulatory involvement on the health care industry.





References:
Bennett, M.L. “Criminal Prosecutions for Medicare and Medicare Fraud.” Association of American Physicians and Surgeons, Inc. Topeka, KS. Retrieved January 23, 2010 from http://www.aapsonline.org/fraud/fraud.htm
Moran, M. (2007). Medicare overpayment rule needs clarification. Retrieved January 23, 2010 from http://pn.psychiatryonline.org/content/42/6/5.full.
United States Department of Health and Human Services. Medicare Fraud. Retrieved January 23, 2010 from http://www.medicare.gov/fraudabuse/Overview.asp.
United States. General Accounting Office, S. 452 and H.R. 868, The Medicare Education and Regulatory Fairness Act of 2001 [Introduced to the U.S. Department of Justice; 11 June 2001]. Regulatory Issues for Medical Providers, GPO Access. Web. 23 January 2010.

United States. Cong. Senate. 106th Congress, 1st Session. S. 608, A Bill to Amend the Nuclear Waste Policy Act of 1982 [introduced in the U.S. Senate; 15 March 1999]. 106th Cong., 1st sess. Congressional Bills, GPO Access. Web. 24 May 1999. .


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