MEDICARE STRENGTHENS OVERSIGHT IN PAYMENT FOR MEDICARE ADVANTAGE AND PRESCRIPTION DRUG PLANS
Background: Aggressive oversight and new improvement efforts have reduced the number of improper fee-for-service Medicare claims payments by half in one year – from 10.1 percent in 2004 to 5.2 percent in 2005. These successful efforts are built on a comprehensive oversight strategy that includes getting additional, specific information about the accuracy of payments in each part of the Medicare program, and using this information to target oversight initiatives to where they can have the most impact.
CMS is developing a comprehensive strategy to measure improper payments for the Medicare Prescription Drug Coverage Program which will be fully implemented in January, 2006.
CMS pays more than 1 billion fee-for-service claims each year, and provides oversight to state payments for services provided by health care professionals under Medicaid and the State Children’s Health Insurance Program (SCHIP). In 2005, Medicare also made monthly payments to more than 450 Medicare health plans across the U.S.
Program Integrity Oversight for Medicare Advantage Plans
In 2005, CMS began to assess the risk for improper payments the Federal government will make to Medicare Advantage plans. In 2006, CMS will take a series of steps to measure the accuracy of these payments in detail and address potential risks. That will include:
- Designing a robust set of measures that will allow CMS to review the monthly plan payments for beneficiaries to identify any potential payment anomalies for specific plans.
- Developing data standards to enable CMS to recognize outliers in payment and identify trends.
- Identifying risks associated with data in the payment system, including plan submitted data, including risk adjustment and institutional status data, and internal data such as Medicaid status.
- Analysis of error rates and risk adjustment factors set by the Agency.
- Ongoing oversight of plans, including determining whether a plan remains eligible for payment.
CMS is also creating an internal team that will help ensure that all new payment systems meet agency requirements for accurate payment. This Agency-wide team will include internal experts in financial management, health plan systems, and Medicare operations.
CMS’ program integrity efforts will be complemented through the work of the Medicare Rx Integrity Contractors (MEDICs) who will help identify and prevent fraud and abuse in the Medicare prescription drug program. The MEDICS will:
- Analyze data to find trends that may indicate fraud or abuse is being conducted;
- Begin to investigate potential fraudulent activities surrounding enrollment, the determination of eligibility or the delivery of prescription drugs under the new coverage;
- Investigate unusual activities that could be considered fraudulent as reported by CMS, contractors, or beneficiaries;
- Conduct fraud complaint investigations; and
- Develop and refer cases to the appropriate law enforcement agency as needed.
The MEDICS were announced on October 2 and more information can be found at: (http://www.cms.hhs.gov/media/press/release.asp?Counter=1693)