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Medicare Advantage Plans Under the FWA Microscope

  • by Margaret Klasa DC, APN BC
  • Jun 29, 2017, 06:25 AM

HEALTHCARE is again the most popular topic for the past few weeks.  Even friends that don’t know much about the industry have asked: what’s going on with Medicare?  Apparently, recent allegations of high dollar medical fraud have raised concerns about Medicare Advantage Plans and Payment Integrity.  One law firm pointed out that this is just the start. 

“DOJ’s big settlement — $16.7 million for risk adjustment “upcoding” — from a small plan may encourage the DOJ to seek even larger amounts in settlements against larger plans.” ------ Faegre Baker Daniels 

Why is this happening? 

The federal government gives participating insurers a monthly payment (reimbursement) for each enrollee in a Medicare Advantage Plan.  Reimbursements are higher for patients with more complex illnesses.  If a payer allows providers to bill for additional, unnecessary services (to make patients appear sicker), their reimbursements go up. 

Is this real or just alleged? 

No one knows yet.  The reality is CMS, OIG, and the DOJ are on a mission to find out.  President Trump’s increased FWA funding suggests this is not going to stop.  All MA Plans are squarely under the FWA spotlight and are at risk. 

How could an MA plan avoid targeted compliance troubles and audits? 

Enforce independence in your Payment Integrity program

First, put more authority and control in the hands of your compliance organization.  Today, operations have significant control over individual product lines as they are profit centers.  Move systems, processes and procurement of compliance related functions under compliance’s control. 

Second, eliminate conflicts of interest with payment integrity vendors.  Many payment integrity functions are complex and IT heavy.  The vendor that supply multi-million contracts for business process outsourcing and other systems to a plan often have payment integrity contracts with the same plan.  Does this save a plan some money by maximizing spend for volume discounts with their vendors?  Maybe.  Would these vendors risk pushing back against the operations management that pays $20 ~ $100 million in other contracts?  Not likely. 

Payment Integrity and reference-based-pricing is Context 4 Healthcare’s only business.  Being independent allows us to provide unbiased feedback and best of breed approaches to compliance.

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