CMS Outlines Improvements in RAC Audit Processes

In the face of complaints from hospitals about backlogs, time-consuming procedures, and lengthy appeals processes involving Medicare Recovery Audit Contractor audits, the Centers for Medicare & Medicaid Services recently outlined changes it has implemented in the RAC audit process to address these and other concerns.  They are (in CMS’s own words):

Better Oversight of RACs

  • We are holding RACs accountable for performance by requiring them to maintain a 95% accuracy score. RACs that fail to maintain this rate will receive a progressive reduction in the number of claims they are allowed to review.
  • We also require RACs to maintain an overturn rate of less than 10%. Failure to maintain such a rate, will also result in a progressive reduction in the number of claims the RAC can review.
  • RACs will not receive a contingency fee until after the second level of appeal is exhausted. Previously, RACs were paid immediately upon denial and recoupment of the claim. This delay in payment helps assure providers that the RAC’s decision was correct before they are paid.


Reducing Provider Burden and Appeals

  • We are making RAC audits more fair to providers. Previously, RACs could select a certain type of claim to audit. Now,

Are Savings Baked Into Medicare Advantage?

Medicare Advantage plans spend less for their members’ care than traditional Medicare – even when beneficiaries switch from traditional Medicare to a Medicare Advantage plan.

This spending trend, moreover, applies to all types of Medicare beneficiaries, even after risk adjustment, regardless of age, gender, or dual-eligibility.  It even applies to beneficiaries with chronic medical conditions, according to a recent study.

Why the difference?  The study’s authors suggest “favorable self-selection.”  Past studies have suggested that Medicare Advantage plans’ care management components are responsible for reduced costs but this study casts that theory in doubt.  Another theory is that the provider networks and utilization management aspects of Medicare Advantage may be more appealing to individuals who are not significant consumers of medical care.

Another issue the study raises:  with Medicare Advantage rates based on traditional Medicare spending and this new evidence that Medicare Advantage spends less on its members than traditional Medicare, it is possible that the federal government has been significantly overpaying Medicare Advantage plans for years.

Learn more in the Kaiser Family Foundation study “Do People Who Sign Up for Medicare Advantage Plans Have Lower Medicare Spending?”

New Client

DeBrunner & Associates is pleased to welcome our newest client:  the University of Pittsburgh Medical Center.

As Pennsylvania’s largest non-governmental employer, with more than 87,000 employees, UPMC consists of more than 30 hospitals, more than 700 doctors’ offices and outpatient sites, an international division, and an enterprises division.


CMS Adopts Rule to Protect Medicaid Payments

A new Medicaid provider payment reassignment regulation eliminates the ability of states to divert any portion of Medicaid payments to third parties.

Such diversion was authorized, in a limited manner, in 2014, when CMS created an exception to the existing prohibition on the diversion of provider payments to third parties.  That exception involved diversion of payments to selected third parties, mostly in-home personal care workers, but in this new, final regulation, the agency eliminates this exception, maintaining that it is inconsistent with the Social Security Act.

Learn more about the new regulation in a CMS news release or see the new regulation itself.…

CMS Solicits Waiver Input From Stakeholders

The Centers for Medicare & Medicaid Services is soliciting ideas from stakeholders about new approaches that might be employed in the development of state relief and empowerment waivers, also known as section 1332 waivers.

Last year CMS loosened section 1332 waiver requirements and offered states four concepts for how to take advantage of both the waivers and the less stringent requirements.  Section 1332 waivers permit states to seek exemption from selected requirements of the Affordable Care Act to pursue new approaches to enhancing access to quality, affordable health insurance.  Through a new request for information, CMS now seeks

…to build a library of options, through more waiver concepts, so that states have additional illustrative ways to take advantage of this new flexibility.

In its RFI, the agency suggests the following possibilities:

  • Waiver concepts that states could potentially use alone or in combination with other waiver concepts, state proposals, or policy changes; 
  • Waiver concepts that could advance some or all of the principles outlined in the 1332 Guidance released in 2018; 
  • Waiver concepts that incorporate the entire range of waivable requirements allowed under section 1332; and
  • How states might combine the flexibilities available under 1332 with other flexibilities that exist under