Medicare Part C Improper Payment Measurement (IPM)

Medicare Part C Improper Payment Measure 

The Centers for Medicare & Medicaid Services (CMS) implements a systematic plan for identifying, measuring, and reporting erroneous Medicare Part C payments every year. Since fiscal year (FY) 2008, CMS has submitted an annual Part C improper payment estimate and the estimation methodology to Congress in the Agency Financial Report (AFR). This page highlights important details about the payment error rate and provides useful links and resources to learn more.

Part C Payment Error Rates from FY 2016 – FY 2021

For FY 2021, CMS reported an improper payment measurement for the Part C program based on Calendar Year 2019 (CY 2019) payments.  The CY 2019 Part C IPM payment error rate of 10.28% is not comparable to prior years as CMS implemented refinements to the denominator methodology. The FY 2021 reporting year is a baseline and should not be compared with prior reporting years. Table 1 presents results from the Part C Payment Error Estimates for FY 2016 – FY 2021.

Table 1:  Part C Payment Error Estimates for FY 2016 – FY 2021

Reporting Year1

Payment Year

Gross Part C Error Rate2

Gross Dollars in Error ($B)

Net Part C Error Rate3

Net Dollars in Error ($B)

FY 2016

2014

9.99%

$16.18

4.19%

$6.79

FY 2017

2015

8.31%

$14.35

2.47%

$4.27

FY 2018

2016

8.10%

$15.55

1.37%

$2.64

FY 2019

2017

7.87%

$16.73

1.33%

$2.83

FY 2020

2018

6.78%

$16.27

0.55%

$1.33

FY 2021 2019 10.28% $23.19 3.18%

$7.18

 

1 The reporting year reports on payment year data from two years prior (e.g., FY 2019 error estimate is based on PY 2017 payments).                                                                    

2 Gross payment error is calculated by taking the sum of the absolute values of the underpayments and overpayments.                                                                                                                                      

3 Net payment error is the difference between total overpayments and the absolute value of the total underpayments.

 

The authority for CMS activities in Medicare Part C is outlined in the Payment Integrity Information Act of 2019 (PIIA) Public Law (116-117), signed March 2, 2020. PIIA revoked the Improper Payments Information Act (IPIA) of 2002 and its subsequent amendments. It also revoked the Fraud Reduction and Data Analytics Act (FRDAA) of 2015. PIIA incorporates relevant provisions from these four acts into a single subchapter in the United States Code.

Page Last Modified:
12/06/2021 11:14 AM