By Ron Harris
St. Louis Post-Dispatch (Missouri)
Copyright 2007 St. Louis Post-Dispatch, Inc.
All Rights Reserved
WASHINGTON — In one case, a doctor who owned several homes, including one overseas, was paid $100,000 under Medicare/Medicaid for much of 2005, even though the doctor owed the nation nearly $1 million in taxes and hadn’t paid federal taxes in nearly seven years.
In another, a doctor bought an expensive car and gambled away millions in the same period without paying the federal government the hundreds of thousands of dollars he owed in taxes. But Medicare/Medicaid still paid him $100,000 in claims.
In another, Medicare/Medicaid paid an ambulance service more than $1 million in claims for nine months of 2005 even though the service owned the federal government nearly $11 million.
In all, an estimated 21,000 physicians, health professionals and suppliers collected hundreds of millions of taxpayers’ money in 2005 even while they owed more than a billion dollars in unpaid taxes, according to the Government Accountability Office, a federal investigative agency.
The reason they got away with all that money, federal officials said Tuesday, was in part because of federal roadblocks, but mostly because of the failures of the Centers for Medicare and Medicaid Services, the agency assigned to pay them.
“I think they have been negligent,” Gregory D. Kutz, GAO’s managing director, said after a Senate hearing on Medicare doctors who cheat on their taxes.
At the hearing, Kutz said there were a number of ways the agency could have brought the medical professionals — about 5 percent of the providers — to trial or halted the payments.
Although federal law prohibits the Internal Revenue Service from sending information on delinquent taxpayers to the centers, it doesn’t prevent the agency from sending the names of its clients to the IRS to be investigated, Kutz said.
Additionally, the agency could have required participating medical professionals to sign a consent decree to allow the IRS to send tax information about them to the agency.
Leslie V. Norwalk, acting administrator of the agency, defended her program, saying the agency was working hard to bring to justice medical professionals who didn’t pay their taxes.
But committee members didn’t accept her explanations about the agency’s failures.
Sen. Claire McCaskill, D-Mo., called Norwalk’s testimony “incredibly discouraging.”
“You came to a hearing on unpaid taxes and you don’t know how much in taxes you’ve been able to collect,” McCaskill said. “That sounds very much like, ‘The dog ate my homework.’”
Sen. Norm Coleman, R-Minn., said he heard Norwalk say that she was upset about the tax cheats, “but I get a sense that the outrage doesn’t filter down to the rest of the agency.”
“I just don’t sense a real resolve to watch the pennies,” he said.