News: CMS must assess, strengthen documentation requirements and medical reviews to address $23 billion in improper payments, GAO says

Insufficient documentation led to approximately $23 billion in improper Medicare payments in fiscal year (FY) 2017, the Government Accountability Office (GAO) said in a March 27 report. GAO recommended that CMS assess and strengthen documentation requirements and medical reviews to more effectively prevent improper payments, Revenue Cycle Advisor reported.

Insufficient documentation made up 64% the estimated improper payments, according to the report. In addition, providers often ignore multiple additional documentation requests (ADR). CMS’ contractors allow providers up to 75 days to submit documentation and will allow providers to submit late documentation up to the program’s cut-off date for claims. In FY 2017, Medicare contractors sent ADRs for 22,815 claims out of a sample of 50,000, according to Revenue Cycle Advisor. In 56% of those instances, the provider did not submit additional documentation to sufficiently support the claims.

According to former Medicare Administrative Contractor reviewer, Rachel Strom, RN, in her 2017 article in the CDI Journal, one of the major hurdles to actually answering ADRs is knowing who receives those requests at your organization.

“You want your current contractor to have an appropriate contact person for your facility, especially for special notifications,” Strom writes. “That contact person shouldn’t be the head receptionist at the front desk. (Yes, I’ve seen this happen.) Even if your facility is small, it’s still best to direct that potential correspondence to an appropriate staff member or department.”

If your CDI team is involved in the denials management and appeals process, make sure you know where to look for the ADRs to ensure you’re not part of the 56% of those who didn’t respond to the request.

For their part, the GAO recommends that CMS:

• Institute a process to routinely assess and take necessary steps to ensure that Medicare and Medicaid documentation requirements are necessary and effective
• Ensure that Medicaid medical reviews provide robust information about and result in corrective actions that effectively address the underlying causes of improper payments
• Minimize the potential for Payment Error Rate Measurement (PERM) medical reviews to compromise fraud investigations
• Address disincentives for state Medicaid agencies to notify PERM contractors of providers under fraud investigation

The Department of Health and Human Services concurred with all but the second recommendation.

Editor’s note: To read Revenue Cycle Advisor’s coverage of this story, click here. To read the report from the GAO, click here. To read Strom’s article in the September/October 2017 edition of the CDI Journal, click here.