Compliance is no longer an optional expense in healthcare

 As of February 28, 2012, health plans and all down-stream entities must ensure regulatory compliance through due diligence and oversight activities.

The Office of Inspector General 2013 Work Plan reiterates these objectives.

2013 HHS Work Plan

Encounter Data—CMS Oversight of Data Integrity (New)

We will review the extent to which MA encounter data reflecting the items and services provided to MA plan enrollees are complete, consistent, and verified for accuracy by CMS.  In 2012, MA encounter data reporting requirements will expand from an abbreviated set of primarily diagnosis data to a more comprehensive set of data.  (One Time Notification, Pub. 100-20, CR 7562.) Prior CMS and OIG audits have indicated vulnerabilities in the accuracy of risk adjustment data reporting by MA organizations.  (OEI; 00-00-00000; expected issue date:  FY 2014, new start)

Risk Adjustment Data—Sufficiency of Documentation Supporting Diagnoses 

We will determine whether the diagnoses that MA organizations submitted to CMS for use in CMS’s risk-score calculations complied with Federal requirements.  We will review the medical record documentation to ensure that the documentation supports the diagnoses submitted to CMS.  Payments to MA organizations are adjusted on the basis of the health status of each beneficiary.  (Social Security Act, §§ 1853(a)(1)(C) and (a)(3).)  MA organizations submit risk adjustment data to CMS in accordance with CMS instructions.  (42 CFR § 422.310(b).)  (OAS; W-00-09-35078; W-00-10-35078; various reviews; expected issue date:  FY 2013; work in progress)

Risk Adjustment Data—Accuracy of Payment Adjustments

We will determine whether CMS properly adjusted payments to MA plans on the basis of the results of its data validation reviews.  Risk adjustment data validation is an annual process of verifying diagnosis codes.  (42 CFR §§ 422.308(c) and 422.310(e).)  The process affects payments to MA plans.  CMS contracts with Quality Improvement Organizations (QIO) or equivalent contractors to verify whether diagnosis codes are supported by medical record documentation.  (OAS; W-00-12-35554; various reviews; expected issue date:  FY 2013; work in progress)

Provision of Services—Compliance With Medicare Requirements

We will review MA organizations’ oversight of contractors that provide enrollee benefits, such as prescription drugs and mental health services.  We will determine the extent to which MA organizations oversee and monitor their contractors’ compliance with regulations and examine the processes they use to ensure that contractors fulfill their obligations.  MA organizations are accountable for the performance of the entities with which they contract.  MA organizations that delegate responsibilities under their contracts with CMS to other entities must specify in their contracts with those entities provisions that the entities must comply with all applicable Medicare laws, regulations, and CMS instructions.  (42 CFR § 422.504(i)(4)).

Compliance is no longer an optional expense in health care. 

Empirical Risk Management provides comprehensive solutions to reduce liability and improve outcomes.