OIG warns Medicare Advantage encounter data have gaps in information critical to oversight

A new watchdog report finds that Medicare Advantage encounter data often lack key information necessary to oversight.

The Department of Health and Human Services' Office of Inspector General found that MA encounter data are largely missing national provider identifiers (NPIs) for the providers ordering or referring services in the claims. 

Those data, according to the report, are crucial to tracking prescribing habits to catch any red flags as part of fraud and abuse oversight.

"NPIs are critical for identifying inappropriate billing and ordering patterns among providers and investigating fraud and abuse," OIG said in the report. "Both CMS and OIG rely on NPIs for ordering providers to conduct oversight and pursue fraud investigations."

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OIG said previous analyses have indicated the NPI data are missing from 63% of encounter data.

Encounter data, and concerns about potential gaps, have been a hot topic in MA policy of late, as the Centers for Medicare & Medicaid Services (CMS) is aiming to increase how much emphasis it places on such data sets in risk adjustment.

For the 2021 plan year, CMS intends to have encounter data account for 75% of the data used in calculating risk scores.

Payers pushed back on these effort, saying the data are often incomplete or contain errors that could negatively impact their scores.

OIG also said there were concerns that MA plans may face undue burden in collecting and processing NPI data, but the agency's survey indicates many payers are already equipped to do so. Many already require that providers submit such data in other business lines such as Medicaid and commercial insurance.

In addition, nearly half of MA insurers believe these data are critical in combating fraud, OIG said.

The watchdog recommended that CMS require MA plans submit the NPI data they have on encounters for laboratory, imaging and home health, as well as implement a system to reject encounter data submitted without NPI information when required. CMS agreed to the first recommendation but not the second.