The federal government overpaid insurance companies offering Medicare Advantage plans by up to $3.1 billion in 2010 because of miscalculated diagnostic data, according to a recent report by the U.S. Government Accountability Office.
Diagnostic coding differences between Medicare Advantage plans and Medicare fee-for-service plans had "a substantial effect" on how Medicare Advantage plans were paid, the GAO report said.
Before Centers for Medicare & Medicaid Services reduced 2010 Medicare Advantage beneficiary risk scores, the GAO said it found those scores were at least 4.8%, and as much as 7.1%, higher than the risk scores would have been as a result of diagnostic coding differences. Even after the CMS adjusted Medicare Advantage scores, they were still too high by between 1.4% and 3.7%.
That difference amounts to between $1.2 billion and $3.1 billion in over payments, the report said. The report does not list the companies who were overpaid. The report also does not say that insurance companies offering Medicare Advantage plans did anything incorrect in receiving the allegedly excessive payments.
The GAO report said part of the problem was the data CMS used for its estimates didn't include such variables as 2008 data, the increasing impact of coding differences over time and additional beneficiary characteristics that explained more variation in disease score growth.
"To help ensure appropriate payments to MA plans, the administrator of CMS should take steps to improve the accuracy of the adjustment made for differences in diagnostic coding practices between MA and Medicare FFS," the report said. Those steps could include accounting for additional beneficiary characteristics, including the most current data available, identifying and accounting for all years of coding differences that could affect the payment year for which an adjustment is made and incorporating the trend of the impact of coding differences on risk scores, the report said.
The report was requested by a group of House Democrats led by Rep. Henry Waxman, D-Calif., who serves as the ranking member of the House Energy and Commerce Committee.
The report supports the America Health Insurance Plans' position that the health care system needs to "move beyond the outdated fee-for-service system to one that rewards quality, value, and better health outcomes," Robert Zirkelbach, an AHIP spokesman, said in a statement. "Unlike the FFS part of Medicare, Medicare Advantage plans work to identify and address beneficiaries' specific health care needs through integrated care coordination, disease management, and quality improvement initiatives."
The GAO finding that Medicare Advantage carriers were overpaid could come into play later this year if Congress once again takes up the issue of how to reduce the federal budget deficit. Medicare Advantage and Medicaid were among the programs that the Joint Select Committee on Deficit Reduction, better known as the "supercommittee," considered cutting in 2011.
When the supercommittee failed to reach an agreement on how to reduce the deficit, some industry observers said having no deal was better than having a deal that cut billions from Medicare and Medicaid.
Part of the reason is that under a deal reached by Congress that created the supercommittee, if a deal couldn't be reached, automatic cuts would go into effect that include a 2% across-the-board cut to Medicare and Medicaid.
Jean LeMasurier, senior vice president for public policy at Gorman Health Group, said at the time that Medicare Advantage carriers as well as Medicare Part D writers immediately began factoring the 2% automatic cuts into their bids (Best's News Service, Dec. 5, 2011).
(By Jeff Jeffrey, Washington Correspondent: jeff.jeffrey@ambest.com) (c) 2012 A.M. Best Company, Inc.
No comments:
Post a Comment