Medicare RACs Identified Almost $2.4 Billion in Overpayments in FY 2014

According to CMS, the Medicare Fee-For-Service (FFS) Recovery Auditor Program identified and corrected $2.57 billion in improper Medicare payments in FY 2014. The lion’s share of this amount — $2.39 billion — represented overpayments collected, compared to $173.1 million in underpayments repaid to providers. Considering all program costs (other than expenses incurred at the third and fourth levels of appeal), CMS concluded that the Medicare FFS Recovery Audit Program returned more than $1.6 billion to the Medicare Trust Funds. Note that the overall level of FY 2014 recoveries was down from FY 2013 levels, when Recovery Audit Contractors (RACs) identified $3.75 billion in improper payments. CMS attributes some of this decrease in RAC identification of improper payments to a prohibition on certain RAC inpatient hospital patient status reviews, along with reduced reviews during the close-out process of existing RAC contracts.



http://www.jdsupra.com/post/documentViewer.aspx?fid=2db04e5a-9976-4e7a-bec6-89d51d290ec7

Senators blast CMS for record payment errors

A Senate committee blasted the Centers for Medicare and Medicaid Services (CMS) Wednesday for failing to prevent record-high improper payments and for putting undue burden on falsely accused providers.

“The bottom line is, despite doing more audits than ever before, Medicare just isn't getting the job done when it comes to preventing payment errors,” said Sen. Bill Nelson (D-Fla.), chairman of the Senate Special Committee on Aging. “Medicare must change the way it pays its providers so that the cheats are getting caught and the honest providers are getting paid.”

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The committee released a bipartisan report Wednesday that says improper Medicare payments are at a record high and that the CMS hasn't done enough to fix the problem.

The report notes improper Medicare payments have climbed from 8.5 percent in 2012 to 10.1 percent in 2013, despite the fact the CMS has hired more recovery audit contractors (RACs) to track providers who may be overbilling for Medicare services.

"The increase in audits has not translated into a reduction in improper payments,” noted Sen. Susan Collins (R-Maine), ranking member on the committee. “In fact Medicare is currently experiencing its highest improper payment rate in five years."

The committee recommends the CMS's audits focus on providers who have made improper claims in the past, compensate auditors based on their ability to prevent improper payments, and improve its ability to track claims that have already been audited so there isn't any duplication.

Nelson and Collins said the RACs were putting undue burden on many providers who are eventually found to be innocent of fraud through the ringer and hurting their business.

“The incentive is out of whack,” said Nelson. “If the goal is you want to reduce the overall amount of improper payments that's what also ought to be what we're going after and compensate the contractors based on that instead of on the number of improper payments that they identify.”

Recently House lawmakers echoed Wednesday's Senate committee criticism. During a House subcommittee panel hearing lawmakers said RACs are more geared toward trying to get paid for every minor mistake rather than trying to prevent improper payments to Medicare.


Read more: http://thehill.com/policy/healthcare/211752-senators-blast-cms-for-record-medicare-fraud#ixzz3711kkEAj

HHS FY 2015 budget to reduce Medicare-Medicaid fraud, waste

The Department of Health & Human Services has release its budget for fiscal year 2015, which the department claims is both “fiscally responsible” and aims to strengthen its two most important programs — and doing so by reducing healthcare fraud and waste.

“On the mandatory side, we’ll contribute a net $369 billion toward deficit reduction over the next decade,” Secretary Kathleen Sebelius said in a press conference earlier today. “By incentivizing high-quality and efficient care and by continuing to reduce healthcare cost growth, this budget also strengthens two very important programs — Medicare and Medicaid — with $415 million in net savings over the next decade and extends the solvency of the Hospital Insurance Trust Fund by five years.”

According to Sebelius, a major focus of the FY 2015 budget is to control the year-to-year growth of Medicare over the next ten years. “It will reduce the average annual growth in Medicare over the next decade from 6.3 percent to 5.3 percent. What’s more, by expanding competitive bidding for durable medical equipment, it also produces additional savings for Medicare and its beneficiaries alike,” she added.

An important part of these cost-reduction efforts highlighted in today’s press conference and budget was the work of Health Care Fraud and Abuse Control Program (HCFAC), whose investment is apparently paying off.

“[The budget] invests $428 million in HCFAC and the Medicare Integrity Program, both of which are proven to deliver results in fighting fraud. Every dollar we invest in HCFAC, for example, returns $8.10 of the money we recover. We’ve now announced recovering a record-breaking $4.3 billion,” she explained.

The budget indicates that preventing fraud and reducing improper payments are “top priorities” for the current administration. The investments in HCFAC and Medicaid program integrity funds are expected to yield $13.5 billion in gross savings for Medicare and Medicaid over the next decade.

The budget is also proposing the introduction of new tools via legislative action to increase program integrity oversight. For the Medicare program, these include:

• Allowing prior authorization for Medicare fee-for-service items;

• Allowing civil monetary penalties for providers and suppliers who fail to update enrollment records;

• Allowing the Secretary to create a system to validate practitioners’ orders for high-risk items and services;

• Increasing scrutiny of providers using higher-risk banking arrangements to receive Medicare payments

• Retaining a percentage of incentive reward payment recoveries

For Medicaid, the following proposal are being made:

• Increasing investment in and expanding authority of the Medicaid Integrity Program;

• Supporting Medicaid Fraud Control Unites for the territories;

• Expanding Medicaid Fraud Control Unit review to additional care settings;

• Tracking high prescribers and utilizers of prescription drugs in Medicaid;

• Consolidating redundant error rate measurement programs;

• Preventing use of federal funds to pay state share of Medicaid or CHIP;

• Improving program integrity for Medicaid drug coverage.

Read the complete HHS FY 2015 budget here.

http://ehrintelligence.com/2014/03/05/hhs-fy-2015-budget-to-reduce-medicare-medicaid-fraud-waste/