By Robert B. Barnett Jr., J.D.
CMS’ policies and procedures to ensure that Medicare payments are not made for services rendered to deceased people are largely effective, with more than 99.9 percent of Medicare Part A and Part B claims being correctly processed during the three years studied, according to an audit by HHS’s Office of Inspector General (OIG). The audit recommends that CMS continue to work with Medicare contractors to collect any improper payments made but still unrecovered (OIG Report, No. A-07-16-05089, October 7, 2016).
CMS procedures. CMS maintains an Enrollment Database, which contains personal and demographic information on every beneficiary ever enrolled in Medicare. CMS collects Medicare beneficiary date-of-death information from the Social Security Administration, from the Railroad Retirement Board, and from a variety of institutional providers, including inpatient hospitals, skilled nursing facilities, hospices, and home health agencies. This information is used to update the date-of-date field on a beneficiary’s record in the Enrollment Database. Once the Enrollment Database is updated, CMS updates its Common Working File, which is used to process all CMS claims. Both the Enrollment Database and the Common Working File are updated daily.
Once a valid date of death has been established, CMS uses the information to prevent improper payments for services rendered after the date of death. If CMS receives an updated date of death after the claim has been processed, CMS sends a notice to the Medicare contractor to adjust the claim to reflect the date of death and to recoup any payments made for services rendered after the death.
OIG audit. The OIG audit was conducted pursuant to requirements contained in the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA). The OIG evaluated CMS’s policies, procedures, and results for the calendar years 2013, 2014, and 2015. It found that 427 Medicare claims were improperly made, for a total of $426,519 improperly paid. It also found that another 1,047 Medicare claims were potentially improperly made, for a total of $1,480,913 potentially improperly paid. Although the figures may sound high, they represent only 0.0002 percent of all Parts A and B payments made during the three years studied.
In response to the audit, CMS agreed that 332 of the 427 claims—totaling $415,069—were improper. The other 95 claims, totaling $11,450, had been recouped by Medicare contractors according to CMS. The 1,047 claims involving potentially improper payments, CMS said, were the result of conflicting date-of-death information between the Common Working File and the Enrollment Database and may well have been properly paid.
Audit recommendations. The OIG audit concluded that CMS has in place effective policies and procedures for avoiding payments to deceased individuals. It also has in place effective policies and procedures for identifying and recouping improper payments where the date of death is entered after the claim has been processed and paid. The OIG made three recommendations. First, that CMS direct Medicare contractors to recoup the 427 claims that OIG and CMS agreed were improperly paid. Second, that CMS confirm that the 95 claims thought to be recouped had actually been recouped. Third, that CMS determine which of the 1,047 potential claims were improper payments and that CMS direct Medicare contractors to recoup those payments.
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