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The Office of Inspector General (OIG) of the Department of Health and Human Services (HHS) recently released a report entitled “Billions in Estimated Medicare Advantage Payments From Chart Reviews Raise Concerns”.

The report highlights that in the current risk adjusted payment system that is meant to provide Medicare Advantage (MA) plans with higher payment for sicker beneficiaries, “chart reviews” is a tool employed by plans whereby they add or delete diagnoses based on reviews of patients’ medical records.

The report notes that the “Key Takeaway” is that “[b]illions of estimated risk-adjusted payments supported solely through chart reviews raise potential concerns about the completeness of payment data submitted to CMS, the validity of diagnoses on chart reviews, and the quality of care provided to beneficiaries.”

Risk-adjusted payments, notes the report, “may create financial incentives for [MA plans] to make beneficiaries appear as sick as possible to obtain higher payments. CMS estimates that from 2013 through 2016, Medicare paid $40 billion in overpayments that resulted from plan-submitted diagnoses that were not supported by beneficiaries’ medical records.”

This OIG report is yet another entry in the growing list of evidence that Medicare Advantage plans continue to manipulate the risk-adjusted payment system to squeeze wasteful overpayment from the Medicare program.  Despite provisions of the Affordable Care Act that have reined in the most excessive overpayments to the private insurance industry, plans continue to get payed more than what Medicare spends on a given enrollee in the traditional Medicare program. At the very least, as the Center for Medicare Advocacy has stated elsewhere, there must be payment parity between traditional Medicare and the MA program, and wasteful spending on MA should be reinvested into the Medicare program to the benefit of all enrollees, not just those who choose to enroll in private plans.

December 20, 2019 – D. Lipschutz

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