News Headlines Article

Insurers banking prepayment interest: audit
Modern Healthcare

At a time of soaring deficits that has left Washington scrambling to find federal healthcare spending offsets, HHS’ inspector general’s office may have identified $450 million in new federal revenue. In an audit sent to CMS Administrator Donald Berwick (PDF), Inspector General Daniel Levinson estimated that Medicare could gain hundreds of millions in interest payments from the Treasury Department if it delays early payments to Medicare Advantage insurance plans. Such early payments—typically made 45 days before they are needed to cover medical expenses—are currently invested by those insurers and HHS allows them to retain the interest, which totaled $376 million in 2007, the latest year available.