Concerns Over CMS’ Medicare Integrity Contractors Escalate As Lawmakers Seek GAO Probe

From: Inside Health Policy

A bipartisan group of key legislators has asked Congress’ investigative arm to probe the effectiveness of CMS contractors’ myriad Medicare program integrity audits, citing the need for a coherent strategic plan if the program is to be successful at tracking down improper payments while not unnecessarily burdensome for providers. Providers have long complained that multiple audit programs are defective, redundant and pull staff and providers away from patient care, and HHS’ Office of Inspector General has also raised concerns about the contractors’ effectiveness.

Senate Finance Committee Sens. Orrin Hatch (R-UT), Max Baucus (D-MT), Tom Coburn (R-OK), Tom Carper (D-DE) and Charles Grassley (R-IA) joined House Energy and Commerce’s Fred Upton (R-MI), Henry Waxman (D-CA), Cliff Stearns (R-FL), Diana DeGette (D-CO), and Ways and Means Reps. Charles Boustany (R-LA) and John Lewis (D-AL) in sending a letter Tuesday (June 26) asking the Government Accountability Office to look into CMS’ oversight of the contractor-driven programs. The lawmakers note that each of the contractor efforts has “its own particular responsibilities to ensure Medicare pays claims accurately.”

The lawmakers specifically ask GAO to study the coordination between Comprehensive Error Rate Testing Review contractors (CERT), Program Safeguard Contractors (PSCs), Medicare Recovery Audit Contractors (RACs), Zone Program Integrity Contractors (ZPICs) and Medicare Administrative Contractors (MACs).

Because multiple programs, each with their own legislatively prescribed niche, audit Medicare providers, health care providers are responsible for working with and responding to multiple contractor requests. The American Hospital Association has vocally complained that the programs are flawed and often look at the same types of issues, which AHA says causes a loss of productivity for providers and takes time away from caring for patients. AHA has also noted that a large percentage of providers’ appeals are upheld.

The legislators tell GAO that in order for contractor oversight to be successful, “it must be undertaken subject to a coherent strategic plan, consistent standards and active coordination.”

The legislators want GAO to focus on what process CMS uses to determine whether the contractors’ audit criteria and methodologies are valid, clear and consistent and how CMS coordinates among contractors to make sure the audits of providers are not duplicative. They also ask GAO to look at whether there is evidence of providers subjected to overlapping audits on the same topic, and how often this might occur.

If this does occur, the legislators also would like to know what justifications are being used to audit a single provider by multiple contractors at the same time. Skilled nursing facilities in Florida have recently said a combination of MAC audits and ZPIC audits of therapy limits are making it difficult for them to stay financially afloat. The American Health Care Association stated in a June 12 letter to CMS that prepayment audits conducted jointly by ZPICs and MACs are “proceeding for unspecified periods of time resulting in significant financial hardship to SNFs with no formal process for a SNF to contest the prepayment review.”

AHCA cited its opinion that the joint audit was an abuse of the wide latitude provided under ZPIC authority and was resulting in “stealth policymaking without the benefit of dialogue with stakeholders.” Industry insiders told Inside CMS that some members of the House Energy and Commerce Committee had been briefed about concerns in Florida, and that if the joint audits spread to other states it could cause a real crisis.

Dianne De La Mare, AHCA’s vice president of legal affairs, tells Inside Health Policy the group is pleased that GAO will be looking into the contractors’ efforts. “We agree with the intent of the GAO request. These contractors play an important role in the Medicare payment structure. But their effectiveness — and credibility — suffer if they lack coordination and a clear set of rules they want providers to follow. Our members aren’t even sure who’s in their buildings most of the time. There must be a better way. That begins with a clear set of standards with reasonable timelines and better communications with our providers.”

The lawmakers have asked GAO to report back on whether CMS has any strategic plan to coordinate and oversee all of the audit activities, as well as how that plan is implemented and overseen. — Michelle M. Stein