Prepayment audits saved Medicare at least $1.76 billion in fiscal year 2010, but the savings could have been even greater if prepayment audits were more widely used, according to a new report from the Government Accountability Office.
CMS reported an improper payment rate of 8.6 percent in the Medicare program for fiscal year 2011. That amounts to roughly $28.8 billion. The GAO was asked to assess the use of prepayment audits in Medicare, in which payments are reviewed before being paid to providers.
The GAO found $14.7 million in payments from FY 2010 that "appeared to be inconsistent with four national policies and therefore improper," according to the report. The agency also identified more than $100 million in payments that were inconsistent with three selected local coverage determinations, which are established by each Medicare administrative contractor to specify coverage rules in its jurisdiction. These payments could have been prevented through automated prepayment audits, according to the GAO.
The GAO said CMS' processes for prepayment audits have some weaknesses, including incomplete analysis of payment vulnerabilities, lack of specific time frames to implement audits, incomplete assessment of whether audits are effective and lack of full documentation of the processes.
The agency recommended seven actions to CMS to strengthen prepayment audits, including full documentation of the process, and HHS "generally agreed" with those recommendations and noted CMS' plans to address them.
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CMS reported an improper payment rate of 8.6 percent in the Medicare program for fiscal year 2011. That amounts to roughly $28.8 billion. The GAO was asked to assess the use of prepayment audits in Medicare, in which payments are reviewed before being paid to providers.
The GAO found $14.7 million in payments from FY 2010 that "appeared to be inconsistent with four national policies and therefore improper," according to the report. The agency also identified more than $100 million in payments that were inconsistent with three selected local coverage determinations, which are established by each Medicare administrative contractor to specify coverage rules in its jurisdiction. These payments could have been prevented through automated prepayment audits, according to the GAO.
The GAO said CMS' processes for prepayment audits have some weaknesses, including incomplete analysis of payment vulnerabilities, lack of specific time frames to implement audits, incomplete assessment of whether audits are effective and lack of full documentation of the processes.
The agency recommended seven actions to CMS to strengthen prepayment audits, including full documentation of the process, and HHS "generally agreed" with those recommendations and noted CMS' plans to address them.
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