A lawsuit filed by the Center for Public Integrity (CPI) has uncovered five new Medicare Advantage audits that resulted in $3.3 million in payment errors. The audits involved an Aetna Health plan in New Jersey, Independence Blue Cross in greater Philadelphia, Lovelace Health Plan in Albuquerque, Humana’s Care Plus plan in South Florida and UnitedHealth Group's PacificCare in Washington state.
The audits were conducted by two sets of auditors using medical records for 201 patients per health plan for the year 2007. Refunds were requested for overcharges; credits were issued for underpayments.
Here are the major findings, which were published on Friday by the CPI:
- Medicare paid the wrong amount for 654 of the 1,005 patients in the sample, an error rate of nearly two thirds. The payments were too high for 579 patients and too low for 75 of them. The total payment error topped $3.3 million in the sample.
- Auditors concluded that risk scores were too high for more than 800 of the 1,005 patients, which in many cases, but not all, led to hefty overpayments. Medicare's annual payment for more than 200 patients was at least $5,000 higher than merited, according to the audits.
- Auditors could not confirm one-third of the 3,950 medical conditions the health plans reported, mostly because records lacked "sufficient documentation of a diagnosis." The names of the medical conditions were redacted by federal officials.
According to CNBC, the Centers for Medicare and Medicaid Services issued the following statement in response to the CPI report: "Reducing improper payments in Medicare Advantage is a top priority for CMS. Since we began measuring and reporting an improper payment rate for Part C, the improper payment rate due to over- and underpayments from inaccurate diagnosis data submitted by Medicare Advantage organizations has declined from approximately 15% in [fiscal year] 2009 to approximately 9% in FY 2014, 6% if you exclude underpayments. While this trend is in the right direction, it is critical that we continue to build on this success."
Some in the industry have expressed frustration over CMS' refusal to make the results of their audits public. In the interest of transparency, in 2011, CMS agreed to release minimal billing data for MA plans annually in order to "inform the public on how their tax dollars are being spent." However, they're still keeping the majority of MA billing data under wraps, even though billing data from thousands of doctors, hospitals and other healthcare providers has been made public. "It's astonishing," Brian Biles, a professor at George Washington University who successfully sued CMS to win release of the limited billing data now available, told CPI. "They are dumping huge amounts of data in other areas. Medicare Advantage is now 30% of the Medicare program."
Timothy Layton, a Harvard Medical School researcher who recently co-authored a paper on health plan "upcoding," said the lack of data leaves researchers unable to examine individual risk scores and the various medical conditions that raise and lower them. "Without the ability to answer these questions, we can keep pointing out how big the overpayment to MA is, but we can never really provide the optimal solution to the problem," Layton told CPI.