News: CMS announces Medicare FFS improper payment rate lowest since FY 2010

Improper Medicare payments have fallen to their lowest level since 2010 due to “aggressive program integrity measures,” according to CMS. The Medicare FFS estimated improper payment rate dropped from 8.12% in FY 2018 to 7.25% in FY 2019. This marks the third consecutive year the Medicare FFS improper payment rate has been below the 10% threshold for compliance established in the Improper Payments Elimination and Recovery Act of 2010.

This year’s decrease is thought to have been caused largely by progress in a few areas, according to CMS:

• Home health claims corrective actions, including policy clarification and Targeted Probe and Educate for home health agencies which resulted in a significant $5.32 billion decrease in estimated improper payments from FY 2016 to FY 2019.
• Other Medicare Part B services (e.g., physician office visits, ambulance services, lab tests, etc.) saw a $1.82 billion reduction in estimated improper payments in the last year due to clarification and simplification of documentation requirements for billing Medicare under their Patients Over Paperwork initiative.
• Durable medical equipment, prosthetics, orthotics, and supplies improper payments decreased an estimated $1.29 billion from FY 2016 to FY 2019 due to various corrective actions.

In the announcement, CMS noted they developed a “five-pillar program integrity strategy to modernize the agency’s approach to reducing the improper payment rate, while protecting its programs for future generations.” The five pillars of this program are:

• Stop bad actors
• Prevent fraud
• Mitigate emerging programmatic risks
• Reduce provider burden
• Leverage new technology

Despite the progress, CMS says it still has work to do. “These initiative strike and important balance between preventing improper payments and reducing the administrative burden on legitimate providers and suppliers,” said CMS.

Editor’s Note: To read CMS’ press release on FFS improper payment rate reduction, click here. To read the CMS newsletter on this topic, click here.