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OIG Report Acknowledges That CMS Consistently Overstates the Medicare Error Rate
March 21, 2012
By: Mark A. Stanley *
AHLA Regulation, Accreditation, and Payment Practice Group Email Alert (American Health Lawyers Association)
On March 9, the U.S. Department of Health and Human Services, Office of Inspector General (OIG) published its Review of Comprehensive Error Rate Testing (CERT) Errors Overturned Through the Appeals Process for Fiscal Years 2009 and 2010 [PDF]. The report details OIG's review of the Medicare fee-for-service (FFS) error rate, which is calculated by the Centers for Medicare & Medicaid Services (CMS) and used in the estimate of improper payments that CMS submits to Congress each year.
OIG determined that the methodology used by CMS in calculating the FFS error rate was flawed, leading to CMS overstating the amount of improper payments by approximately $2 billion in each of the fiscal years reviewed. Specifically, CMS failed to account for some providers' successful appeals from claim payment denials issued by the Medicare CERT contractor. When such appeals are taken into account, the total FFS error rate is materially lower than CMS has reported to Congress. OIG has recommended that CMS refine its methodology to ensure that all successful appeals are incorporated into the FFS error rate calculation.
Copyright 2012 American Health Lawyers Association, Washington, DC
Reprint permission granted.
* Mark A. Stanley is a former member of Ober|Kaler's Health Law Group.