If you look at the AMA report cards, you’ll see that most claims denied by Medicare were due to billing errors (inadequate data on billing forms, wrong carrier, not enrolled in program, etc.). Also, some denials are for non-covered services such as routine physical exams. Medicare has been more effective in requiring compliance with the program, which is entirely appropriate considering that these are our taxpayer dollars that they are spending.

In contrast, the relaxation of compliance standards by the private health plans has wasted funds that we have paid in as premiums. Charging us higher premiums so that they can pay dubious claims does not represent private sector efficiency. We are paying the private plans far more in administrative costs than we do for Medicare, yet they are not providing the claims processing efficiency that we deserve. As an example, Medicare pays the contracted rate 98% of the time, whereas the private insurers do so only 66% to 84% of the time. The fact that they can’t get right the rates that they contracted for demonstrates the profound incompetence of the private insurance industry.