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Medicare could save millions by limiting advance payments to insurers

Kaiser Health News, April 17, 2013
Medicare could earn up to $111 million annually if it limited insurers' ability to retain investment earnings on the billions they are paid through the prescription drug program, according to a government report out today. That's because Medicare prepays the private insurers approximately 20 days before the insurers pay their pharmacy bills and does not require them to return any of the interest they earn while holding that money, says the report by the Office of the Inspector General for the Department of Health and Human Services. That contrasts with how the government treats insurers in the Federal Employees Benefit Program, which provides health coverage for federal workers, the report said.