The Centers for Medicare & Medicaid Services has reportedly saving taxpayers approximately $400 million by reducing improper payments in Medicare fee-for-service programs.
According to the CMS, improper FSS payments decreased from 3.9 percent in fiscal year 2007 to 3.6 percent in FY 2008.
"We are using the most effective information-gathering tools available to help us identify and eliminate improper payments in our efforts to protect the integrity of CMS programs," said Kerry Weems, CMS' acting administrator. "Measuring performance, publicly reporting results and providing payment incentives that encourage high quality and efficient care are paramount to keeping CMS accountable to the beneficiaries and American taxpayers."
CMS also reported its first Medicare Advantage improper payment rate of 10.6 percent, or $6.8 billion, in payments made during calendar year 2006. The first Medicaid composite error rate is 10.5 percent, or $32.7 billion, of which the federal share is $18.6 billion; for SCHIP, the rate is 14.7 percent, or $1.2 billion, with a federal share of $0.8 billion.
Improper payment rates include those payments that may have been paid incorrectly and do not necessarily reflect fraud. For Medicare FFS, most improper payments are due to claims for services that were medically unnecessary or incorrectly coded.
The "vast majority" of Medicaid and SCHIP errors are due to inadequate documentation - providers either didn't submit information to support their FFS or managed care claims or didn't submit additional data when requested, a similar trend seen with Medicare Parts A and B in previous years.
Other errors are due to services provided under Medicaid or SCHIP to beneficiaries who were not eligible for either program or who were not eligible for the services received.
"One of the best tools we have to lower the amount of improper payments is education," said Weems. "We have seen marked success in working with healthcare providers and the Medicare contractors to lower the Medicare fee-for-service error rate and will use lessons learned related to Medicaid, SCHIP and Medicare Advantage payment error rate reporting to support our oversight efforts."
The Medicare FFS rate has declined from about 14 percent in 1996 to 3.6 percent in 2008, according to CMS officials. They expect the error rates for Medicare Advantage, Medicaid and SCHIP to decline similarly through program maturation and the agency's use of tools that include statistical sampling, medical reviews and error rate reduction plans.