Corporate Compliance

GAO: Medicare doctors, suppliers owe back taxes

Healthcare Auditing Weekly, March 27, 2007

A new report out of the Government Accountability Office says the federal government has failed to collect more than $1 billion in back taxes owed by Medicare doctors and suppliers, the Washington Post reports.

More than half of the unpaid bills stem from payroll taxes which were collected from workers but never sent to the IRS, the GAO said. Instead, some medical providers spent the payroll tax money on luxury purchases.

To date, the money hasn't been collected because HHS has yet to connect its infrastructure with the IRS. Once the connection is made, it will be much easier to deduct money from Medicare payments to those who owe, the GAO authors noted.

Medicare already withheld $339 million in payments during 2006 from providers and suppliers known to owe the IRS back taxes.

Read the Post report here.

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