Medicare fraud, exchange oversight among top payment challenges for HHS

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Program integrity in both Medicaid and Medicare, overseeing health insurance marketplaces, and maintaining the shift toward value-based payments represent key focal points for the Department of Health and Human Services (HHS) in the coming year.

The Office of Inspector General (OIG) highlighted these issues in a report identifying the top 10 management and performance challenges facing HHS. The report also isolated several IT challenges facing the federal agency involving the transition toward EHRs and cybersecurity weaknesses.

On the payment side, the OIG focused heavily on program integrity concerns within both Medicare and Medicaid, as well as improved oversight of Medicare Advantage and healthcare exchanges:

  • Underscoring Medicare’s 12.1% improper payment rate, the OIG said the Centers for Medicare & Medicaid Services must do more to identify program areas that are susceptible to abuse, including home health and durable medical equipment (DME) suppliers. Although the Health Care Fraud and Abuse Control program has made significant progress fighting fraud, CMS should take additional steps to ensure fraudulent providers cannot enroll in Medicare and continue improving its ability to identify improper claims before they are paid.
  • Similarly, CMS must do more to improve oversight of Medicaid payments. In April, the agency finalized a new Medicaid managed care rule that addresses previously identified program vulnerabilities, but CMS continues to face challenges reducing Medicaid improper payments and coordinating state-based program integrity efforts.
  • Although President-elect Donald Trump’s vow to repeal and replace the Affordable Care Act has raised questions about the long-term viability of health insurance marketplaces, the OIG says HHS needs to continue making improvements to both federal and state exchanges by ensuring that beneficiary information is complete and accurate and that consumers are receiving the appropriate financial assistance.
  • As HHS continues its shift from volume- to value-based payments, CMS needs to pay specific attention to the challenges associated with MACRA along with the “growing portfolio of complex models and innovations,” according to OIG. The watchdog agency notes that there should be a detailed focus on ongoing program integrity efforts associated with any new payment models. Additionally, CMS should ensure Medicare Advantage beneficiaries have access to quality services, and that that MA risk-adjustment data is accurate. Legal cases and previously unreleased government audits have highlighted overbilling concerns tied to inaccurate risk scores in Medicare Advantage.

Fraud, waste and abuse concerns dominated the OIG’s top 10 challenges last year, particularly within Medicare Parts A and B. But Trump’s presidential victory and a potential ACA repeal could impact the way federal agencies target healthcare fraud.