Ask the Advisor: Medicare Premium vs. COLA: Seniors Getting Further and Further Behind

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Ask the Advisor: Medicare Premium vs. COLA: Seniors Getting Further and Further Behind

At these new Medicare premium rates the government may as well get the shovels out and start burying us all now. With each year’s COLA we keep getting further and further behind. If the government would start doing their job and investigate the overcharging and cheating I think Medicare could start to get back in shape. Something has to be done. Since seniors are the largest block of voters, pressure should be applied to the sorry congressman that we put into office and of course our beloved president. — C. M.

From the editor, Mary Johnson:
According to The Wall Street Journal, the federal government will collect a record amount of fines and settlements from the health care industry in 2003. This is small comfort to the 41 million Medicare recipients who will see their premiums jump by $7.90 per month, from $58.70 in 2003 to $66.60 in 2004. In the last three fiscal years, the government has collected $4.21 billion in fines and settlement from health care investigations. That’s well over the $3.29 billion it collected in the prior 10 years combined. Opinions vary, says the Journal, on whether the surge in penalties is due to rising incidents of fraud, or more aggressive investigations by the government.

Advisor’s senior “drug correspondent” in Hawaii, retired pharmacist Duane Hess, points out that “according to many of the media stories, fraud is often NOT discovered by Medicare, or by any other government agency. Rather it comes to surface because former employees report it to the authorities as a ‘whistleblower.’ Often the practices have been going on for years in full daylight, without any awareness on the part of Medicare, ” says Hess.

According to The Wall Street Journal, whistleblowers walked away with $95 million recently when TAP Pharmaceutical Products Inc., in 2001, agreed to pay $875 million in civil and criminal penalties. Just one case alone!

Says Hess, “According to media reports, TAP allegedly sold Lupron, a drug used to treat prostate cancer, to physicians for about $100 to $150 per one-month dose, and then ‘encouraged’ doctors to bill the government and other insurers for a higher amount. TAP also allegedly offered doctors as much as $70,000 in free samples and told them to ‘bill insurers as if they had purchased it,’ even though billing for free samples is a violation of federal law. Court documents reveal that some doctors pocketed as much as $400 to $550 per sample.”

Hess continues, “I think one could conclude that these products must be substantially over-priced if pharmaceutical companies can afford to participate in schemes such as these. If Medicare is to be preserved and continued for the benefit of our children and grandchildren, then better methods of fraud detection and prevention must be developed and implemented.”

TSCL agrees that seniors should hold their Members of Congress and the President accountable for stronger anti-fraud measures to protect Medicare.

December 2003