Enhancing Medicare Program Integrity

New directives, implementing guidance, and legislation will impact CMS’s efforts to reduce improper payments in the next few years. For example, the Improper Payments Elimination, and Recovery Act of 2010 established additional requirements related to accountability, recovery auditing, compliance and noncompliance determinations, and reporting. In addition, the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 also contain provisions designed to help reduce improper payments in the Medicare program. CMS has taken action in several areas, but problems persist in ensuring the integrity of the Medicare program.

• CMS has already taken action to improve program integrity—for example; as required by law, it implemented a national Medicare Recovery Audit Contractors (RAC) program in 2009.
• Further, CMS has set a key performance measure to reduce improper fee-for-service and Part C payments and is developing measures of improper payment for Part D.
• The current status of the Medicare improper payment rates complicates assessment of progress in reducing them. In addition to recently adding estimates for Part C and D, refinements to the methodology used to determine the final 2009 and 2010 fee-for-service improper payment rates make them not comparable to earlier years. As a result, CMS cannot demonstrate that it has made progress in reducing payment errors.
• Other recent CMS program integrity efforts include issuing regulations strengthening provider enrollment requirements and creating a Center for Program Integrity, responsible for addressing program vulnerabilities leading to improper payments.
• However, having corrective action processes to address the vulnerabilities that lead to improper payments is important to effectively managing them and CMS did not develop an adequate process to address the vulnerabilities to improper payments identified by the RACs.
  

  Highlights of GAO-10-143 (PDF)

• CMS’s Medicare Integrity Program (MIP) – established in the Health Insurance Portability and Accountability Act of 1996 (HIPAA) – is designed to identify and address fraud, waste, and abuse, which are all causes of improper payments. However, CMS has not clearly communicated to its staff the relationship between the daily work of conducting MIP activities and the agency’s improper payment reduction performance goals. Additionally, CMS calculates returns on investment for most of its MIP activities, but the data it uses has flaws.

  Highlights of GAO-11-592 (PDF)

• Additionally, in 2006, CMS initiated efforts to integrate claims information and improve its ability to detect fraud, waste, and abuse in Medicare and Medicaid with two information technology system programs: the Integrated Data Repository (IDR) and One Program Integrity (One PI). However, CMS has not incorporated into IDR all data as planned and has not taken steps—such as developing reliable schedules for training users—to ensure widespread use of One PI. The agency has also not yet positioned itself to identify, measure, and track benefits realized from these efforts.

  Highlights of GAO-11-475 (PDF)

• In 2011, GAO found indications of doctor shopping—where individuals see several doctors and pharmacies, receiving more of a drug than was intended by any single physician—in the Medicare Part D program for 14 categories of frequently abused prescription drugs. About 170,000 beneficiaries (about 1.8 percent of beneficiaries receiving these drugs) acquired the same class of frequently abused drugs, primarily hydrocodone and oxycodone, from five or more medical practitioners during calendar year 2008 at a cost of about $148 million (about 5 percent of the total cost for these drugs). Although CMS’s prescription drug plans have systems in place to identify individuals with doctor shopping behavior, according to CMS policy officials, federal law may not authorize them to restrict those individuals’ access to drugs.

  Highlights of GAO-11-699 (PDF)

• CMS's administration of the home health benefit continues to be unable to prevent home health agencies (HHAs) from billing for services that are not medically necessary or that are not rendered. For example, CMS does not provide physicians responsible for authorizing home health care with information that would enable them to determine whether an HHA was billing for unauthorized care.

  Highlights of GAO-09-185 (PDF)

• In addition, CMS’s oversight of Part D plan sponsors’ programs to deter fraud and abuse has been limited. However, CMS has taken some actions to increase it. In 2010, CMS conducted on-site compliance plan audits of 33 of 290 sponsors, which represented 11 percent of sponsors, 56 percent of plans, and covered 62 percent of enrolled beneficiaries.

  Full Report of GAO-11-269R (PDF)

^ Back to topWhat Needs to Be Done

Further action should be taken by CMS and Congress to enhance Medicare program integrity. Specifically, CMS should

• Develop and implement an adequate process that includes policies and procedures to ensure that the agency promptly evaluates and addresses RAC-identified vulnerabilities to reduce improper payments;

  GAO-10-143 (PDF)

• review its findings and consider steps such as a restricted recipient program for identified doctor shoppers and seek congressional authority, as appropriate;

  GAO-11-699 (PDF)

• communicate the linkage between MIP activities and the goals for reducing improper payments and that CMS expeditiously improve the reliability of data used to calculate returns on investment;

  GAO-11-592 (PDF)

• take steps finalize plans and reliable schedules for fully implementing and expanding the use of IDR and One PI and to define measurable benefits;

  GAO-11-475 (PDF)

• require its contractors to develop thresholds for unexplained increases in billing and use the thresholds to develop automated prepayment controls and to exchange information on the automated prepayment controls; and
  

  Highlights of GAO-07-59 (PDF)

• amend current regulations to expand the types of improper billing practices that are grounds for revocation of billing privileges for HHAs and HHA officials; and
• provide physicians with a statement of home health services beneficiaries received based on the physicians’ certification.

  Highlights of GAO-09-185 (PDF)

^ Back to topKey Reports

Medicare Recovery Audit Contracting

Medicare Part D

Medicare Part D

Medicare Integrity Program

Medicare

Fraud Detection Systems

More Reports