Several types of Medicare contractors conduct postpayment claims reviews to help reduce improper payments. Questions have been raised about their effectiveness, efficiency, and the burden on providers. To this extent, the U.S. General Accounting Office (GAO) was asked to assess aspects of the claims review process. The GAO released a report of its findings on August 13, which says that while the U.S. Department of Health and Human Services (HHS), Centers for Medicare & Medicaid Services (CMS) has taken steps to prevent its contractors from conducting certain duplicative postpayment claims reviews, CMS neither has reliable data nor provides sufficient oversight and guidance to measure and fully prevent duplicative reviews.
In the report, “Medicare Program Integrity: Increased Oversight and Guidance Could Improve Effectiveness and Efficiency of Postpayment Claims Reviews,” the GAO reviewed four types of contractors that examine providers’ documentation to determine whether Medicare’s payment was proper, as follows:
- Medicare Administrative Contractors (MACs), which process and pay claims.
- Zone Program Integrity Contractors (ZPICs), which investigate potential fraud.
- Recovery Auditors (RAs), more familiarly known as Recovery Audit Contractors (RACs), tasked with identifying, on a postpayment basis, improper payments not previously reviewed by other contractors.
- The Comprehensive Error Rate Testing (CERT) contractor, which reviews claims used to estimate Medicare’s improper payment rate annually.
The report, which builds on GAO’s July 2013 report on postpayment claims review requirements, lists the following findings:
- CMS implemented a database to track RAC activities, designed in part to prevent RACs, which conducted most of the postpayment reviews, from duplicating other contractors’ reviews. However, the database was not designed to provide information on all possible duplication, and its data are not reliable because other postpayment contractors did not consistently enter information about their reviews. CMS has not provided sufficient oversight of these data or issued complete guidance to contractors on avoiding duplicative claims reviews.
- CMS requires its contractors to include certain content in postpayment review correspondence with providers, but some requirements vary across contractor types and are not always clear, and contractors vary in their compliance with their requirements. In addition, the extent of CMS’ oversight of correspondence varies across contractors, which decreases assurance that contractors comply consistently with requirements. In the correspondence reviewed, GAO found high compliance rates for some requirements, such as citing the issues leading to an overpayment, but low compliance rates for requirements about communicating providers’ rights, which could affect providers’ ability to exercise their rights.
- CMS has strategies to coordinate internally among relevant offices regarding requirements for contractors’ claims review activities. The agency also has strategies to facilitate coordination among contractors, such as requiring joint operating agreements between contractors operating in the same geographic area. However, these strategies have not led to consistent requirements across contractor types or full coordination between ZPICs and RACs. GAO previously recommended that CMS increase the consistency of its requirements, where appropriate, and the HHS Office of Inspector General has recommended steps to improve coordination between ZPICs and RACs.
GAO Recommendations: In response to these findings, GAO recommends that CMS take actions to improve the efficiency and effectiveness of contractors’ postpayment review efforts, which include providing additional oversight and guidance regarding data, duplicative reviews, and contractor correspondence. In its comments, HHS concurred with the recommendations and noted plans to improve CMS oversight and guidance.
GAO Recommendations for Executive Action
GAO also made the following recommendations for executive action:
- In order to improve the efficiency and effectiveness of Medicare postpayment claims review efforts and simplify compliance for providers, the CMS administrator should monitor the Recovery Audit Data Warehouse to ensure that all postpayment review contractors are submitting required data and that the data the database contains are accurate and complete.
- In order to improve the efficiency and effectiveness of Medicare postpayment claims review efforts and simplify compliance for providers, the CMS administrator should develop complete guidance to define contractors’ responsibilities regarding duplicative claims reviews, including specifying whether and when MACs and ZPICs can duplicate other contractors’ reviews.
- In order to improve the efficiency and effectiveness of Medicare postpayment claims review efforts and simplify compliance for providers, the CMS administrator should assess regularly whether contractors are complying with CMS requirements for the content of correspondence sent to providers regarding claims reviews.
- In order to improve the efficiency and effectiveness of Medicare postpayment claims review efforts and simplify compliance for providers, the CMS administrator should clarify the current requirements for the content of contractors’ additional documentation requests and results letters and standardize the requirements and contents as much as possible to ensure greater consistency among postpayment claims review contractors’ correspondence.
