GAO: Medicare spent $48 billion on improper payments in 2010

The Government Accountability Office (GAO) reports an estimated $48 billion in Medicare improper fee-for-service payments in 2010, representing about 38 percent of the total $125.4 billion estimate for the federal government. The estimate includes both overpayments and underpayments.

The report, issued at the request of a House subcommittee investigating Medicare and Medicaid fraud, cited causes including inadequate documentation, medically unnecessary services, coding errors and payment calculation errors.

The report states that the $48 billion is not an estimate of fraud in Medicare. Because the improper payment estimation process is not designed to detect or measure the amount of fraud that may exist, there may be fraud that is not reflected in HHS’s reported estimate.

In 2010, Medicare covered 47 million elderly and disabled beneficiaries and had estimated outlays of $516 billion.