A bipartisan group of lawmakers has introduced legislation that would equip the nation’s 48-million-and-counting Medicare enrollees with smartcards, thus improving access to healthcare and saving an estimated $30 billion a year in fraud and waste.
The proposed legislation comes as three other lawmakers are petitioning the Government Accountability Office to evaluate the Centers for Medicare & Medicaid Services’ Medicare eligibility system, saying it sometimes takes far too long to determine beneficiary eligibility.
The Medicare Common Access Card Act of 2011, sponsored by Sens. Mark Kirk (R-Ill.), Ron Wyden (D-Ore.) and Marco Rubio (R-Fla.) in the Senate and Reps. Jim Gerlach (R-Pa.), Earl Blumenauer (D-Ore.) and John Shimkus (R-Ill.) in the House, would create a two-stage process for the smartcard program. The first stage would consists of a number of pilot programs to embed microchips in Medicare identification cards, while the second would expand those programs nationwide.
The pilot programs would study the smartcards’ ability to improve quality and access to care and accuracy of Medicare and reduce the likelihood of identity theft, waste, fraud and abuse.
The Department of Justice has estimated the cost of Medicare fraud at $60 billion per year, while the Office of Management and Budget said more than $48 billion in improper payments were made by Medicare in 2010. Supporters of the smartcard proposal say it would reduce fraud and improper payments by authenticating providers, patients and services at the point of care. Under the current process, Medicare generally pays all claims, then tries to recoup fraudulent payments after they’ve been made.
The enhanced cards would not display Social Security numbers and would require a PIN for verification. Under the proposal, healthcare providers would also be issued with cards with biometric security features, and both the providers and the patient would have to insert their cards into a reader at the point of care to confirm that services were rendered.
The program is modeled on the Common Access cards now used by some 20 million Department of Defense personnel and Military Health System enrollees.
“Building on the smartcards already issued to all Americans in uniform, we can offer seniors more protection for their identities while reducing fraud and waste in the strained Medicare system,” Sen. Kirk said in a press release issued by the six lawmakers. “By removing a senior's social security number from the front of the card and including the security upgrades used on the cards of our troops, this secure Medicare Common Access Card will also help end Medicare's current 'pay then chase' policy that allows so much fraud and waste.”
The proposal has received support from the Secure ID Coalition, a group of four companies that offer identity protection services like smartcards, and the AARP. The SIDC has launched a website, www.UpgradeTheCard.org.
“This innovative bill will protect our nation’s seniors by issuing them an upgraded, secure Medicare card similar to the identity credential used by the Department of Defense, known as the Common Access Card. Based on a smart card platform – a proven, tested, and trusted technology used throughout government – the modernized Medicare card will also help to protect our senior’s privacy and security by taking the Social Security number off of the front of the Medicare card. This is a basic privacy protection seniors have been demanding for years, and it’s about time they were heard,” said Kelli Emerick, the SIDC’s executive director, in a press release.
Officials estimate the new program would cost $19 per person in cards and readers if enacted on a nationwide basis.
The smartcard program could aid the Medicare eligibility system called into question on Sept. 22 by Republican Sens. Richard Burr (North Carolina), Tom Coburn (Oklahoma) and Orrin Hatch (Utah). In a letter sent to CMS, the three lawmakers cited “concerns about recurring problems with” CMS’ HIPAA Eligibility Transaction System (HETS).
The senators said some healthcare providers and beneficiaries have complained of long wait times in trying to confirm eligibility, as well as a lack of telephone access to CMS.
“If HETS is failing to serve providers and seniors – whether due to increased transaction volume because of the new Medicare beneficiaries aging into the program or to mismanagement and neglect – Congress deserves to know the facts … in order to help CMS make the necessary course corrections before the problem becomes more acute,” the letter read.
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