Trump’s New Medicare Fraud Rules Conflict with Recent Executive Order

Trump next to text reading Medicare fraud overhaul with background of Medicare and Social Security cards

On October 9, The Trump administration announced a proposal to overhaul new rules preventing Medicare fraud and abuse. However, the rules may directly contradict a recent executive order he signed to bolster privatized Medicare Advantage plans–some of which have been defrauding Medicare to the tune of $10 billion annually. 

Current rules

The current rules were put into place to prevent Medicare fraud and abuse, but now the Trump administration believes they are preventing doctors, hospitals, and healthcare clinics from easily coordinating patient care. In other words, the administration is advocating healthcare providers be able to share patients’ health information with other providers more easily.   

The main rule the administration wants to overhaul is one meant to limit self-dealing and kickbacks among healthcare providers who could refer patients to healthcare facilities they can financially benefit from. For example, if a doctor is a partial owner of a physical therapy clinic, the doctor is barred from referring the patient to this clinic and profiting off the referral.

Another example of Medicare fraud and abuse: A hospital may discharge a patient with a heart condition along with some sort of heart monitor, even if it’s not medically necessary. If this heart monitor senses any sort of disturbance, the hospital can then request the patient return to the hospital for further treatment. Unbeknownst to the patient, they have been illegally induced into returning to the hospital, which would be far more expensive than other means of care. 

According to Seema Verma, administrator of the Centers of Medicare and Medicaid Services (CMS), “The goal is to allow hospitals to share cyber-security technology with medical practices they deal with, improving protections across the health care system.”

Medicare Advantage plans found guilty of fraud

On October 3, Trump gave a speech in Florida during which he briefly discussed an executive order designed to reform Medicare. However, what the executive order really does is bolster privatized Medicare Advantage plans, steering more and more of the country’s seniors in this direction to weaken Original Medicare

This juxtaposition of announcements is ironic because some Medicare Advantage plans were recently found guilty of defrauding the Medicare and the U.S. government of more than $10 billion annually. Additionally, private insurers are issuing $1.3 billion in rebates this fall as recompense for intentionally overcharging consumers. 

In other words, Trump’s executive order is bolstering the private insurers that have been caught red-handed in committing the fraud his administration is attempting to stop. 

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