At a House Energy and Commerce Subcommittee on Oversight hearing on March 2, the Government Accountability Office (GAO) presented a report examining fraud and improper payments in Medicare.  The report found that $48 billion of the $509 billion in FY2010 Medicare outlays went to fraudulent or otherwise improper payments.  The report argues that the Centers for Medicare & Medicaid Services (CMS) is not doing enough to prevent fraud, and suggests implementing fraud prevention measures including improved physician profiling and payment reform.

From the report:

As GAO reported in its 2011 High-Risk Series update, Medicare remains on a path that is fiscally unsustainable over the long term. This fiscal pressure heightens CMS’s challenges to reform and refine Medicare’s payment methods to achieve efficiency and savings, and to improve its management, program integrity, and oversight of patient care and safety. CMS has made some progress in these areas, but many avenues for improvement remain.

Full Report: Medicare: Program Remains at High Risk (PDF | 257 KB) 

Government Accountability Office. (2011). Medicare: program remains at high risk because of continuing management challenges.