Thoughts on health care savings

By Joe Spear
Free Press Editor

One of the key selling points of health care reform is that part of the law aims to curb fraud and waste in Medicare.

What people may not realize is that Congress passed a law to reform the way Medicare payments are paid in 2003. Yes, seven years ago.

A GAO report in March to Sens. Charles Grassley and Max Baucus, Republican and Democrat health care leaders shows payment reform is working, sort of.

The number of contractors managing Medicare claims was reduced from 51 to 19. The aim is to try to reduce the $310 billion annual costs of paying the Medicare claims by catching fraud and curbing administrative inefficiency.

Unfortunately, the GAO report determined the new program was making progress, but as yet, savings could not be estimated. It didn't say savings weren't happening. It's just they couldn't quite be figured. And it looked like the reform effort was going to be completed before the 2011 deadline set by Congress.

But cutting even 5 percent inefficiency out of a program - most would say there's at least 5 percent inefficiency in a government program - would save $15 billion, about 10 percent of projected savings of new health care reform over 10 years.

Reading the report leaves you with one impression. This thing is incredibly complicated and a lot of smart people are trying to make it better.