In the May 10, 2010 issue of Forbes Magazine, the On My Mind section features resident scholar at the Institute for Policy Innovation Merrill Matthews.
Mr. Matthews primary point is a good one: cut the fraud in Medicare (about 10%) down to the insurance industry “norm” of 1.5%.
Do this and you have about $40 billion a year in savings.
This does make sense, just like it makes sense when a politician says they want to run government like a business.
But why does this never work?
What is it that makes government different from business?
Politics, sure, but come on, businesses have politics teeming through them also.
The real difference is motivation.
In general, government’s prime motivation is power…who is in control of what.
Business is motivated by money.
A perfect example is being played our right now.
Nobody at HHS wants to be the “bad guy”. So, rather than the HHS coming down hard on physicians, they hire a 3rd party to be the bad guy (RACs).
This is standard government fare: don’t enforce the rules/laws on the books, make a new rule/law…that probably won’t get enforced by the government, but some 3rd party.
What does all of this matter anyway?
When the 3rd party gets involved is when things get real nasty.
That 3rd party is a business, motivated by money.
When commissions are paid on recovered funds (or fines for failed audits on the HIPAA side), these 3rd parties get very motivated to enforce.
This is a “wash, rinse, repeat” cycle.
It will continue.
You better be ready…are you?