GAO: Some providers who owe taxes still receive Medicare payments

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As many as 5% of all providers participating in the Medicare program owe more than $1.3 billion in income and employment taxes, according to the Government Accountability Office.

Some 21,000 physicians, health professionals and other healthcare vendors paid under Medicare Part B during the first nine months of calendar year 2006 had tax debts totaling at least $1.3 billion. GAO officials offered this information in a report to the Senate Homeland Security and Governmental Affairs subcommittee. Many nursing homes offer Part B therapy services.

Legislators hearing the report suggested that the government employ the Internal Revenue Code that allows the government to impose a 15% continuous levy on providers who have not paid a tax or have refused to do so, and are continuing to provide services under the Medicare program.