Against Equity and Good Conscience, Indeed

Medicare watchers know that the federal government recently – and improperly – sent checks to 230,000 seniors. The checks were supposed to reimburse certain seniors for premiums paid under the new Medicare prescription drug benefit (Part D). But seniors who were not supposed to receive any money at all instead got checks worth an average of $215 – for a total of almost $50 million in erroneous payments.

The feds tried to get seniors to return the money – that is, until the Center for Medicare Advocacy, Inc. filed suit to stop them. In fact, the Center even argued that even though seniors were not entitled to the money, they should get to keep it:

In certain circumstances a beneficiary may be entitled to a waiver of the overpaid refund. Waiver of the overpayment may be available to a beneficiary who was without fault in causing the overpayment and where repayment would be against equity and good conscience.

(Bold and italics in original.)

So not only may seniors pressure Congress to grant them windfalls that they don’t really deserve (e.g., Part D), but according to the Center for Medicare Advocacy, a senior should also get to keep even unlegislated transfers from younger Americans if the senior feels that returning the windfall “would be against equity and good conscience.”

But this is par for the course with Medicare. For more examples of Medicare madness, attend or watch online this Thursday’s book forum for Medicare Meets Mephistopheles, a new book by Cato adjunct scholar David Hyman.