GAO Recommends Improvements to the Medicare Repayment Bureaucracy

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For Immediate Release: April 4, 2012

Contact: Katie Gommel
American Association for Justice
202-965-3500 x8369
AAJ Press Room

GAO Recommends Improvements to the Medicare Repayment Bureaucracy

AAJ supports the SMART Act to Address GAO’s Concerns

Washington, DC—Today, the U.S. Government Accountability Office (GAO) released a report – requested by Ranking Member of the Ways and Means Health Subcommittee Rep. Pete Stark (D-CA) – analyzing the inefficiencies of the Medicare Secondary Payer system (MSP). 

The American Association for Justice (AAJ) continues to call on Congress to pass the Strengthening Medicare and Repaying Taxpayers (SMART) Act of 2011 to streamline the MSP system in order to better protect seniors and taxpayers.

The MSP process is supposed to ensure Medicare is reimbursed for medical bills that are the responsibility of another party – such as an insurer or negligent party. A senior who has been injured – and later obtains recourse through the legal system – often cannot access their settlement until Medicare is reimbursed for any medical costs.

“MSP continues to be an inefficient, slow and uncertain system that leaves the health and financial security of senior citizens at risk while costing the taxpayers millions of dollars every year, said AAJ President Gary M. Paul.  “The GAO report recommends a recovery threshold for reporting claims to improve the system’s cost-efficacy; the SMART Act would create this threshold and has support from insurers, business and consumer advocate groups.”  

The SMART Act was introduced in the U.S. House of Representatives (H.R. 1063) on March 14, 2011 and currently has 98 bipartisan cosponsors. The Senate companion bill (S. 1718) was introduced on October 18, 2011 and currently has 15 bipartisan cosponsors. 

AAJ released a MSP primer detailing the lengthy delays and inconsistencies of the current system, which can be found here.

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