According to an investigation by the Government Accountability Office, more than 27,000 nursing homes, hospitals, physicians, and other providers collected millions of dollars in Medicare payments but failed to pay taxes, the Washington Post reports. The report did not cite provider names, but said 6 percent of all providers in the Medicare program were found to have "flouted the tax system while collecting Medicare fees in 2006."

"Medicare is a healthcare program that is designed to serve our nation's seniors, yet this investigation reveals that . . . some health care providers are subverting the tax system to line their pockets," said Senator Norm Colman, who requested the investigation along with Sen. Carl Levin.

According to Kerry Weems, acting administrator for the Centers for Medicare and Medicaid Services, the automated system used by the IRS to hold portions of payments from contractors who are delinquent on their taxes will include all Medicare payments by October.