Leaders of three congressional committees have raised concerns about how the Centers for Medicare and Medicaid Services investigates Medicare fraud. Senator Orrin Hatch (chairman of the Senate Finance Committee), along with Representatives Kevin Brady, Fred Upton, Peter Roskam, Tim Murphy, Pet Tiberi, and Joseph Pitts (leaders on the Energy and Commerce and Ways and Means Committees) sent a letter to CMS Acting Administrator Andy Slavitt, taking issue with the way the agency investigates fraud claims.
The letter notes that the lawmakers support CMS’ efforts to implement the FPS, but that CMS may rely too heavily on an outdated “pay and chase” concept, despite efforts to move to a more preventative model. The congressmen note that it isn’t until the payments have already been made that CMS investigates claims – they would like to see the agency do more to prevent fraudulent payments from being made in the first place. “We remain concerned that in spite of the steps taken, CMS still relies too heavily on investigating claims after the payments have been made rather than preventing them in the first place.” Lawmakers noted that the top Medicare services affected by fraud include home health and hospice care.
Under the Small Business Jobs Act of 2010, CMS began to deploy a Fraud Prevention System [FPS], which the lawmakers note “uses predictive analytics to identify claims and providers that present a high fraud risk to the Medicare program.” Even still, “improper payments remain an enormous problem” for Medicare. In the letter, the lawmakers cite data showing that in 2015, the Medicare Fee-for-Service Program had an error rate of 12.1 percent, or $43.3 billion in lost dollars. “Each dollar lost to fraud is a dollar that is not used to benefit patients,” the lawmakers noted. “This represents a significant burden on the program and taxpayers.”
During a hearing held by the House Ways and Means Oversight Subcommittee in late September, Chairman Peter Roskam noted, “[I]f we use better data analysis and predictive analytics – complex data can be used to identify fraud and improper payments faster. And that’s important not only to save taxpayer dollars, but to save patients who are being harmed by these criminals.” He took issue with the fact that not only may taxpayers be “footing the bill for unnecessary narcotics,” but also that “this also contributes to the country’s growing opioid and painkiller epidemic.”
In an effort to understand the work of CMS to implement the FPS, the lawmakers requested information about the types of schemes and impacted Medicare programs that have been identified for referrals for Zone Program Integrity Contractors (ZPICs), which were created to protect the Medicare program; the number of investigations that were conducted by ZPICs over the past three years; what types of edits and/or filters have been put into place as a result of the Fraud Prevention System in the past three years; the adjusted savings for FPS based on CMS-developed adjustment factors to identify amounts saved or returned to the Medicare trust fund; the total amount obligated over the past three years for FPS and the ZPICs; and a description of the process currently in place to monitor the effectiveness of the FPS models and how CMS verifies that the models are working as intended.