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Healthcare Profits & Fraud

Which is greater: the average profit margin of health insurance companies or the average improper payment rates of major government healthcare programs?

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The average profit margin of health insurance companies is about 3%, while the average improper payment rate of Medicaid is 10%, Medicare is 8%, and the Children's Health Insurance Program is 9%. An improper payment is "any payment that should not have been made or that was made in an incorrect amount (including overpayments and underpayments)." Per the U.S. Government Accountability Office: "Once fraudulent or improper payments are made, the government is likely to only recover pennies on the dollar."



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