CMS Finalizes Risk Adjustment Policies to Combat Medicare Advantage Overpayments
The Centers for Medicare and Medicaid Services (CMS) has finalized risk adjustment policies in a final rule to prevent overpayments to Medicare Advantage Organizations (MAOs).[0] On Feb. 1, the CMS is slated to finalize the Risk Adjustment Data Validation rule, which would increase the amount of overpayments Medicare Advantage insurers must return to the government.[0]
Chiquita Brooks-LaSure, Administrator of the Centers for Medicare and Medicaid Services (CMS), declared that CMS is devoted to shielding individuals with Medicare and being a reliable guardian of taxpayer money.[1] In this rule, we are striving to protect Medicare access for the present and future. We have taken into account a great deal of feedback from interested parties and created a well-thought-out system for monitoring the Medicare Advantage program that is comparable to how we oversee the usual Medicare.[2]
HHS Secretary Xavier Becerra said, “Protecting Medicare is one of my highest responsibilities as Secretary, and this commonsense rule is a critical accountability measure that strengthens the Medicare Advantage program. CMS has a responsibility to recover overpayments across all of its programs, and improper payments made to Medicare Advantage plans are no exception.”[2]
Private Medicare carriers generated an estimated $17 billion through overpayments last year, according to a report the Medicare Payment Advisory Commission (MedPAC) issued this month.[0] MAOs are required to submit data to CMS about patient diagnoses and the agency can audit the data to determine if Medicare over- or underpaid for the diagnoses.[1]
The implemented policies will enable CMS to direct their audits towards MAOs that present the greatest risk of receiving improper payments.[1] However, CMS will not impose major penalties until audits for payment years 2018 and beyond are conducted.[3]
Matt Eyles, president of the trade group AHIP, said in a statement, “Our view remains unchanged: This rule is unlawful and fatally flawed, and it should have been withdrawn instead of finalized.[4] This rule will be detrimental to the elderly, exacerbate health disparities, and be prejudicial towards those who require the most medical attention.[5] Additionally, the rule would cause seniors and taxpayers to pay higher prices, those who opt for MA to receive fewer benefits, and fewer plan options to be available in the future.[5] It is our hope that CMS will continue to collaborate with us in order to ensure the health and economic wellbeing of the American people through our joint public-private partnership.[5]
0. “CMS RADV rule increases Medicare Advantage, provider audits” Modern Healthcare, 24 Jan. 2023, https://www.modernhealthcare.com/insurance/cms-radv-rule-medicare-advantage-provider-audits-oak-street-health-agilon-health
1. “HHS Issues Final Rule to Protect Medicare, Strengthen Medicare Advantage, and Hold Insurers Accountable” EIN News, 30 Jan. 2023, https://www.einnews.com/pr_news/614228910/hhs-issues-final-rule-to-protect-medicare-strengthen-medicare-advantage-and-hold-insurers-accountable
2. “HHS Finalizes Medicare Advantage Risk Adjustment Data Validation Program Rule” HealthPayerIntelligence.com, 30 Jan. 2023, https://healthpayerintelligence.com/news/hhs-finalizes-medicare-advantage-risk-adjustment-data-validation-program-rule
3. “Government Lets Health Plans That Ripped Off Medicare Keep the Money” Kaiser Health News, 30 Jan. 2023, https://khn.org/news/article/cms-audits-medicare-advantage-plans-can-keep-hundreds-of-millions-in-federal-overpayments-maybe-more/
4. “Medicare Advantage plans lose out in final RADV audit rule that ditches fee-for-service adjuster” FierceHealthcare, 30 Jan. 2023, https://www.fiercehealthcare.com/payers/medicare-advantage-plans-lose-out-final-radv-audit-rule-ditches-fee-service-adjuster
5. “CMS issues final rule on the Medicare Advantage risk adjustment program” Healthcare Finance News, 30 Jan. 2023, https://www.healthcarefinancenews.com/news/cms-issues-final-rule-medicare-advantage-risk-adjustment-program
