Medicare Paying For Treatment Of Deported Criminals

By Jeff Johnson | July 7, 2008 | 8:28 PM EDT

1st Add: Includes report details, recommendations.

Capitol Hill ( - The federal government's Medicare program has "improperly" paid more than $800,000 in fees on behalf of former beneficiaries, including convicted criminals, after those individuals had been deported from the United States, according to an Inspector General's report released Wednesday.

The Office of the Inspector General at the U.S. Department of Health and Human Services inspected payment records for 1998 and 1999, and found that 1,072 Medicare beneficiaries had been deported.

Of those, 43 had fee-for-service payments made on their behalf totaling $688,933. The money, according to the report, was for services allegedly provided after they had been deported.

Managed care organizations received an additional $147,778 in Medicare payments on behalf of six individuals, with those payments made after the dates of deportation.

"It should be noted that substantial amounts of these overpayments were made for deported beneficiaries with criminal backgrounds and convictions," wrote the report's author, Inspector General Janet Rehnquist.

"These convictions included possession of a controlled substance, extortion, defrauding the Social Security Administration, and attempted murder," Rehnquist added.

Sen. Chuck Grassley (R-Iowa), ranking member of the Senate Committee on Finance, expressed shock at the discovery.

"We need to pay for a prescription drug benefit for legitimate Medicare beneficiaries," Grassley said. "We don't have money to waste on Medicare benefits for people who are in the country illegally. It's especially shocking that some of these improper payments went to convicted criminals. Medicare is treating thugs who have been booted out of the
country. That has to stop."

The report,based on a review requested by the Senate Finance Committee, said the payments were allowed because the Center for Medicare and Medicaid Services (CMS) does not use deportation data, which is already available in its computer system, to screen out payments on behalf of deported beneficiaries.

Of the deported beneficiaries identified in the investigation, one had been deported three times between 1967 and 1982. Another had also been deported three times, the last time for defrauding the Social Security Administration of $60,000.

The report determined the improper payments could be the result of:

- deported individuals illegally returning to the U.S. and seeking Medicare services, also illegally;
- other people mistakenly or fraudulently using the Medicare cards of a deported individuals; or
- Medicare providers mistakenly or fraudulently billing for services not provided to a deported person.

The Inspector General also found that CMS did not routinely terminate Medicare Part B enrollment when deported beneficiaries failed to pay their Part B premium, as required by law.

This failure subsequently allowed deported individuals to remain enrolled in managed care programs and to possibly receive treatment for which they were not eligible.

"We are concerned that unless CMS strengthens its internal control structure, future payments made on behalf of deported individuals will not only happen, but may [also] increase," Rehnquist wrote.

The report recommends that CMS immediately begin using the deportation data it already possesses to deny future claims for deported beneficiaries; return any unpaid claims made; and seek reimbursement for the overpayments already made.

Rehnquist noted that CMS "generally concurred" with the recommendations.

Grassley hopes the attention focused on the improper payments noted in the Inspector General's report would lead to the problems being corrected quickly.

"Medicare doesn't have a penny to spare for undeserving people," Grassley said. "It's already being squeezed to the limit, and that will only get worse when the baby boomers retire. Now is the time to nip this problem in the bud."

The investigation began after Grassley, who was at the time chairman of the Senate Committee on Finance, convened a hearing in April 2001 to examine government payments and benefits being provided to prisoners, fugitives, dead people and other ineligible individuals.

Testimony at that hearing revealed that between $790 million and $831 million a year is improperly spent through just 12 benefit programs at the Department of Health and Human Services and the Social Security Administration.

It was also learned that a Social Security program to provide cash assistance for the needy was paying $30 million a year to wanted felons. Wednesday's report was the first in the series requested by Grassley.

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