CMS is significantly cutting down the amount Medicare claims reviewed for improper payments under its Recovery Audit Program, according to an Oct. 28 letter reviewed by The Wall Street Journal.
Beginning Jan. 1, the auditors will only be able to review 0.5 percent of the claims Medicare pays to each hospital or provider every 45 days. That's down from the prior threshold of 2 percent.
CMS finalized changes to its medical review strategy in its 2016 Hospital Outpatient Prospective Payment System and Ambulatory Surgical Center Payment System rule, which scales back the responsibilities of the auditors. Under the new strategy, Quality Improvement Organizations — groups of health quality experts, clinicians and consumers who work under direction of CMS — will conduct initial patient status reviews to determine the appropriateness of Medicare Part A payment for short-stay inpatient hospital claims. These first-line medical reviews were previously conducted by Recovery Audit Contractors or Medicare Administrative Contractors.
The Recovery Audit Program is meant to identify and correct improper Medicare and Medicaid over- and underpayments. In fiscal year 2014, Recovery Auditors identified $2.4 billion in overpayments and $173 million in underpayments, according to CMS.
However, as noted by The Wall Street Journal, many providers and hospitals feel the audits inflict an excessive administrative burden that impede patient care. They also find the appeals process can be slow, though providers are successful in appealing the auditors' findings about one in five times, according to data from The Wall Street Journal.
Though CMS has not publicly discussed the pull back in audits, a spokesman told The Wall Street Journal the changes "help strike the right balance between [CMS'] responsibility to ensure that Medicare claims are paid appropriately, that beneficiaries continue to have access to necessary services, and that program integrity efforts are focused on providers...who present the greatest risk to the program."
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