Obama to Sign Executive Order Releasing $1 Billion to Cut Medical Fraud

President Barack Obama will once again sidestep a fractious Congress and sign an executive order designed to cut fraud from Medicare and Medicaid.  The Department of Health and Human Services (HHS) will administer the changes, such as testing changes to obsolete hospital billing systems to prevent overbilling, administration officials said.

The billion-dollar initiative will reward the “most compelling new ideas” for cutting costs and improving care of Medicare and Medicaid patients with rewarding federal grants.  Called the Health Care Innovation Challenge, the initiative will provide between $1 million and $30 million over three years to individual organizations or coalitions that develop sustainable, new approaches to improving healthcare quality and efficiency.  “We’ve taken incredible steps to reduce healthcare costs and improve care, but we can’t wait to do more,” said HHS Secretary Kathleen Sebelius.  “Both public and private community organizations around the country are finding innovative solutions to improve our healthcare system, and the Health Care Innovation Challenge will help jump-start these efforts.”

Centers for Medicare and Medicaid Services (CMS) administrator Dr. Donald M. Berwick, M.D. said, “When I visit communities across the country, I continually see innovative solutions at the very ground.  By putting more programs like this in place and more ‘boots on the ground,’ these types of programs can truly transform our healthcare system.”

This program is part of the Obama Administration’s “We Can’t Wait” initiative, which is a series of legal Executive Branch steps designed to move America forward while Congressional Republicans block critical and necessary legislation.

To demonstrate that its campaign to cut government waste is working, the White House said the administration cut improper payments by nearly $18 billion in 2011, largely in such programs as Medicare, Medicaid, Pell Grants and food stamps.  Budget chief Jack Lew ordered federal agencies to tighten their oversight of contractors and grant recipients to reduce the potential for taxpayer waste.

Not surprisingly, there was some immediate opposition to the initiative, with Republican critics calling it a “$1 billion experiment.”  “On the day the Supreme Court decided to review the constitutionality of ‘Obamacare,’ the president is asking for another $1 billion in taxpayer dollars to pay for another healthcare experiment that will continue taking us in the wrong direction,” said RNC spokeswoman Kirsten Kukowski.  “We already spent $2.6 trillion on his job-killing health care bill.  Another $1 billion Executive Order is just more words for a president more interested in campaign talking points than creating jobs.”

With the Supreme Court preparing to hear arguments for and against the Patient Protection and Affordable Care Act (ACA) next March, it is important to note that even the 26 states suing to have the law overturned are hedging their bets.  Only four states have refused all federal money to plan for the changes that are scheduled to take place.

Several healthcare industry leaders expressed their support for the ACA. “The system is transforming itself,” said Charles N. Kahn III, president of the Federation of American Hospitals.  “But the success of these changes depends a lot on whether there is sufficient funding.”  Nationally, hospital systems are anticipating an influx of federal funds and patients as the law goes into full effect.  “If the law is struck down, healthcare reform will have to continue one way or another,” said Patricia Brown, president of Johns Hopkins HealthCare.

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