Tuesday, May 6, 2014


Dianne De La Mare

The US Department of Health and Human Services (HHS), Office of Inspector General (OIG) recently testified before the House Ways and Means Committee at a hearing titled “Ideas to Improve Medicare Oversight to Reduce Waste, Fraud and Abuse.”

At the hearing, Gloria Jarmon (OIG, Deputy Inspector General for Audit Services), made clear that fighting waste, fraud and abuse in the Medicare program is a top priority for the agency. In her testimony, Jarmon states “that more action is needed from CMS, its contractors and the Department to reduce improper Medicare payments and billings and improve oversight of its Medicare contractors. Reducing improper payments and improving the oversight of contractors are two of the OIG’s top management and performance challenges and are critical to reducing Medicare waste, fraud and abuse.”

Specifically, OIG uncovered improper Medicare payments on behalf of unlawfully present, incarcerated and entitlement-terminated and deceased beneficiaries and made the following key recommendations to CMS:

1) implement policies and procedures to detect and recoup improper payments made to unlawfully present and incarcerated beneficiaries;
2) prevent enrollment in Part D of unlawfully present beneficiaries, disenroll any currently enrolled unlawfully present beneficiaries, and automatically reject PDE records submitted by Part D plans for prescription drugs provided to this population;
3) Identify and recoup improper payments made on behalf of entitlement-terminated beneficiaries and establish policies and procedures to prevent additional improper payments; and
4) improve existing safeguards to prevent payments to deceased beneficiaries.

OIG also found limitations in program safeguards that leaves Medicare Part D vulnerable to waste, fraud and abuse and made the following key recommendations to CMS:

1) require part D plans to verify that prescribers have the authority to prescribe drugs;
2) instruct the Medicare contractor to expand its analysis of prescribers and provide Part D plans with additional guidance on monitoring prescribing patterns; and
3) Strengthen the Medicare contractor’s monitoring of pharmacies and its ability to identify for further review pharmacies with questionable billing patterns.

Lastly, regardless of the type of Medicare contractor, OIG found common issues that limit CMS’ oversight, and it made the following key recommendations to CMS:

1) CMS should require mandatory reporting by Part C and Part D plans of potential fraud and abuse incidents;
2) CMS should determine whether outlier data values submitted by Part C and Part D plans reflect inaccurate reporting or atypical performance; and
3) CMs should seek a legislative change to increase the time between Medicare Administrative Contractors (MAC) contract competitions to give CMs more flexibility in awarding new contracts when MACs are not meeting CMS requirement.

To obtain a complete copy of the testimony go to HHS Website.

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