- A scathing new report by the Government Accountability Office found Medicare is doing little to effectively prevent overbilling by private Medicare Advantage plans serving the elderly.
- The GAO suggested "fundamental improvements" will be needed to impact the overbilling issue.
- GAO researchers particularly criticized Medicare's slow process for recouping improper payments, Risk Adjustment Data Validation (RADV), which has cost the government about $117 million for audits while recouping only $14 million.
While the GAO blasts Medicare's RADV audits as pricey and ineffective, CMS argues the threat of the audits has resulted in health plans electing to return $650 million in overpayments voluntarily, NPR reported. The GAO reviewers add improved upcoming audits are expected to recover $370 million, but note that's still only 3% of the estimated annual overpayment.
The overpayments are primarily attributed to abuse of risk scores, which incentivize insurers to characterize their enrollees as being as sick as possible to draw more revenue.
The report does not name the health plans examined but says some plans have "known improper payment risk" that CMS has allowed to continue despite mounting evidence of wasted spending.
The GAO also argued CMS has allowed its audits to take too long, with some still in the appeals process from as far back as 2007.
America's Health Insurance Plans (AHIP) countered the report with the argument that an "unconfirmed diagnosis" doesn't rule out a person having the disease claimed, NPR reported.