Stark Revelation

So government auditors have uncovered evidence of fraud in Medicare. Or rather, more fraud. The politicos lingering around Washington can barely keep a straight face as they claim to be shocked.

A draft report by the inspector general of Health and Human Services -- circulating on Capitol Hill and leaked this week -- determines that Medicare may have paid $2.8 billion in improper or fake claims for medical equipment in 2006. That's an error rate of 31.5%, in a single corner of this colossal entitlement. "This report doesn't surprise me," fumed Democrat Pete Stark.

Glad to hear the Congressman is catching on, given that dozens of studies have come to similar conclusions. But he aims his real outrage at the Bush Administration, which says it has stepped up its efforts to combat fraud and reined it in more than the inspector general alleges. "To look better to the public, you cook the books," Mr. Stark continued. "This agency is incompetent."

We're speechless. Mr. Stark and his ilk consistently claim that Medicare is a model for government-run "universal" health care because it spends less on overhead than the private sector. True, Medicare's administrative costs are just 3% of total spending, while the private sector hits 11% to 14%.

But insurance companies spend money to screen their claims for fraud. Medicare automatically pays more than 95% of the bills it receives. This lack of scrutiny reduces overhead, but it makes the program highly vulnerable to abuse. In June, a high-school dropout pleaded guilty to conning Medicare out of $105 million by submitting over 140,000 bogus claims before auditors noticed. It was the biggest health-care fraud in American history.

The real reason liberals like Mr. Stark are outraged is because they want to claim one of Medicare's vices as a virtue, to help along their health-care ambitions. The inspector general's report makes their argument poorer politically. It also shows that taxpayers will be literally poorer if Mr. Stark gets his way.

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Deadbeat public hospitals in Australia

But their army of clerks and "administrators" still get their pay on time, of course. Clerking is the one ESSENTIAL activity in all public hospitals

Public hospitals are threatening the livelihood of small businesses across New South Wales by failing to pay their bills. Suppliers have been forced to suspend services or pursue legal action until tens of thousands of dollars worth of outstanding invoices are paid. Companies struggling to recoup unpaid bills range from a bakery, hardware store, taxi service and dairy supplier to fuel stations, a tyre dealer, software supplier, grower's market and confectioners. Medical providers - including pharmacists, physiotherapists and psychiatrists - have also been left as much as $40,000 each out of pocket.

Hospitals in the Greater Southern, Greater Western, South Eastern Sydney Illawarra and North Coast areas have among the biggest debts. "Most hospitals never pay their bills for months and most of the suppliers are too scared to create problems because they are threatened with losing their contracts," a NSW Health source said.

Belinda and Wayne Morrison, owners of Bels Gordon St Bakery in Port Macquarie, have supplied the town's hospital for nine years. But, in the past six months, the hospital's unpaid invoices have mounted to as much as $7000. "We are a small business and we do need cash flow," Mrs Morrison said. "It's frustrating having to chase money - especially when I give them goods and they get money back on the same day." The buns and cakes that her bakery supplies are sold at a profit by the hospital's cafeteria. "They sell them for quite a healthy profit." she said.

NSW Opposition health spokeswoman Jillian Skinner said the Government had an obligation to pay bills on time. "It's the lowest of the low for a big government agency to make suppliers hold out for payment of services and goods that they have supplied," she said. "It's mean and it's jeopardising some of those small businesses that have to pay their bills and staff on time - they struggle to stay afloat."

The Sunday Telegraph has learned of a case in which a fuel station refused to fill up area health service vehicles in the South Eastern Sydney Illawarra area because of unpaid hospital bills. Colin Richardson, managing director of Global Direction software suppliers, suspended services to Dubbo Base Hospital's pathology service in May after accounts of more than $22,500 were unpaid. "Now we have put them on pre-pay so they pay in advance," Mr Richardson said.

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