HHS IG Audit: 'Medicare Continues To Make Overpayments for Chronic Care Management Services'

WASHINGTON, Aug. 14 (TNSRep) -- The Health and Human Services Inspector General issued the following audit report (No. A-07-19-05122) entitled "Medicare Continues To Make Overpayments for Chronic Care Management Services, Costing the Program and Its Beneficiaries Millions of Dollars" filed under the Centers for Medicare and Medicaid Services:

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Here are excerpts:

Report in Brief

Why OIG Did This Audit

Effective January 1, 2015, the Centers for Medicare & Medicaid Services (CMS) established a policy for Medicare to pay under the Medicare Physician Fee Schedule for chronic care management (CCM) services rendered to beneficiaries whose medical conditions meet certain criteria. Effective January 1, 2017, CMS unbundled complex CCM from non-complex CCM and began paying separately for complex CCM. Although scope of service and billing requirements are the same for non-complex CCM as for complex CCM, the two types of services differ as to clinical staff time, medical decision-making, and care planning. CCM services are a relatively new category of Medicare-covered services and are at higher risk for overpayments. This audit expands on the findings of a previous Office of Inspector General audit.

Our objective was to determine whether payments made by CMS to providers for noncomplex and complex CCM services rendered during calendar years (CYs) 2017 and 2018 complied with Federal requirements.

How OIG Did This Audit

Our audit covered over 7.8 million claims submitted by physicians and over 240,000 claims submitted by hospitals for non-complex and complex CCM services provided in CYs 2017 and 2018. Paid physician and hospital claims for those services for CYs 2017 and 2018 totaled $356 million. We reviewed CMS's internal controls specific to claims containing CCM services.

What OIG Found

Not all payments made by CMS to providers for non-complex and complex CCM services rendered during CYs 2017 and 2018 complied with Federal requirements, resulting in $1.9 million in overpayments associated with 50,192 claims. We identified 38,447 claims resulting in $1.4 million in overpayments for instances in which providers billed non-complex or complex CCM services more than once for the same beneficiary for the same service period. We also identified 10,882 claims that resulted in $438,262 in overpayments for instances in which the same provider billed for both non-complex or complex CCM services and overlapping care management services rendered to the same beneficiaries for the same service periods. Further, we identified 863 claims that resulted in $52,086 in overpayments for incremental complex CCM services that were billed along with complex CCM services that we identified as overpayments. For these 50,192 claims, beneficiaries' cost sharing totaled up to $540,680.

These errors occurred because CMS did not have claim system edits to prevent and detect overpayments.

What OIG Recommends and CMS Comments

We recommend that CMS direct the Medicare contractors to: (1) recover the $1.9 million for claims that are within the reopening period, and instruct providers to refund up to $540,680, which beneficiaries were required to pay; (2) based on the results of this audit, notify appropriate providers so that they can exercise reasonable diligence to identify, report, and return any overpayments in accordance with the 60-day rule and identify any of those returned overpayments as having been made in accordance with this recommendation; and (3) implement claim system edits to prevent and detect overpayments for non-complex and complex CCM services. We also recommend that CMS implement claim system edits at its level.

CMS concurred with all of our recommendations and described corrective actions for the recovery of the overpayments we identified and the refund of amounts overcharged to beneficiaries. CMS also stated that since our audit period, it has implemented claims processing controls, including system edits, to prevent and detect these types of overpayments. CMS added, though, that some providers may not be liable for the overpayments because they could be found to be without fault under the provisions of the Social Security Act. Our recommendations conform to CMS provisions that the Medicare contractors make determinations regarding the recovery of overpayments.

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TABLE OF CONTENTS

INTRODUCTION ... 1

Why We Did This Audit ... 1

Objective ... 2

Background ... 2

Payment Differences Based on Setting ... 2

Non-complex Chronic Care Management ... 4

Complex Chronic Care Management ... 5

Overlapping Care Management Services ... 6

The 60-Day Rule and 6-Year Look-back Period ... 6

How We Conducted This Audit ... 6

FINDINGS ... 7

Payments for Multiple Claims for the Same Beneficiary ... 8

Payments for Claims Containing Chronic Care Management Services That Overlapped With Other Care Management Services ... 11

Payments for Incremental Complex Chronic Care Management Services Associated With Overpayments for Complex Chronic Care Management Services Identified by Office of Inspector General ... 12

LACK OF CLAIM SYSTEM EDITS FOR CHRONIC CARE MANAGEMENT SERVICES ... 14

RECOMMENDATIONS ... 14

CMS COMMENTS AND OFFICE OF INSPECTOR GENERAL RESPONSE ... 15

APPENDICES

A: Audit Scope and Methodology ... 17

B: CMS Comments ... 19

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INTRODUCTION

WHY WE DID THIS AUDIT

Effective January 1, 2015, the Centers for Medicare & Medicaid Services (CMS) established a policy for Medicare to pay under the Medicare Physician Fee Schedule (PFS) for chronic care management (CCM) services rendered to beneficiaries whose medical conditions meet certain criteria. Before that effective date, physicians did not have the ability to bill separately for non-face-to-face care management services provided to these beneficiaries. Care management services are management and support services provided by clinical staff, under the direction of a physician or other qualified health care professional, to a patient. Services include establishing, implementing, revising, or monitoring the care plan, coordinating the care of other professionals and agencies, and educating the patient or caregiver about the patient's condition, care plan, and prognosis.

Initially, CMS covered CCM services without distinguishing between: (1) those of lesser complexity and lower time consumption and (2) those of more complexity and time consumption. Under new Federal rules that became effective January 1, 2017, CMS unbundled complex CCM from non-complex CCM and began paying separately for complex CCM under the Medicare PFS./1

The effect of this change was to allow health care providers (including hospitals and physicians) to receive payments for the relatively more complex and time-consuming services rendered under complex CCM.

Although the scope of service and billing requirements are the same for non-complex CCM as for complex CCM, the two types of services differ as to the amount of clinical staff service time provided, the complexity of medical decision-making, and the nature of care planning that was performed.

CCM services are still a relatively new category of Medicare-covered services and have multiple restrictions on when and how they can be billed. CCM payments are at higher risk for overpayments compared with payments for more established Medicare services because CMS generally needs time to conduct provider education and create and test controls to ensure that claims for new services conform to the restrictions. The recent unbundling of these services also means that sufficient controls may not be in place to ensure compliance with applicable requirements. A previous audit determined that CMS did not have sufficient controls in place to ensure that Medicare payments for non-complex CCM services during calendar years (CYs) 2015 and 2016 complied with Federal requirements./2

For this audit, we expanded on that previous work to review both non-complex and complex CCM services paid after CMS unbundled them.

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OBJECTIVE

Our objective was to determine whether payments made by CMS to physicians and hospitals (providers) for non-complex and complex CCM services rendered during CYs 2017 and 2018 complied with Federal requirements.

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BACKGROUND

Under the provisions of Title XVIII of the Social Security Act (the Act), the Medicare program provides health insurance for people aged 65 and over, people with disabilities, and people with permanent kidney disease. CMS administers the program. Medicare Part A provides inpatient hospital insurance benefits and coverage of extended care services for patients after hospital discharge. Medicare Part B provides supplementary medical insurance for medical and other health services, including coverage of hospital outpatient services. CMS contracts with Medicare contractors to, among other things, process and pay claims submitted by providers.

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FINDINGS

Not all payments made by CMS to providers for non-complex and complex CCM services rendered during CYs 2017 and 2018 complied with Federal requirements. Of the 8,061,572 claims we reviewed, 50,192 claims did not comply with Federal requirements, resulting in $1,918,278 in overpayments.

Specifically, of the 50,192 claims totaling $1,918,278, we identified the following:

* 38,447 claims that resulted in $1,427,930 in overpayments for instances in which providers billed non-complex or complex CCM services more than once for the same beneficiary for the same service period. The 38,447 claims included instances in which a single provider billed more than once (21,327 claims) as well as instances in which more than one provider billed for the same beneficiary (17,120 claims).

* 10,882 claims that resulted in $438,262 in overpayments for instances in which the same provider billed for both non-complex or complex CCM services and overlapping care management services rendered to the same beneficiaries for the same service periods.

* 863 claims that resulted in $52,086 in overpayments for incremental complex CCM services that were billed along with complex CCM services that we identified as overpayments. Because the payments for the complex CCM services represented overpayments, these incremental complex CCM claims should have been denied just as the complex CCM claims should have been.

For these 50,192 claims, beneficiaries' cost sharing totaled up to $540,680./14

Table 1 on the following page summarizes these findings and breaks out, for each finding, the amount of overpayments made by CMS and the amount of overpayments made by beneficiaries.

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[See link at end of text for Table 1: Claims Questioned]

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The errors we identified occurred because CMS did not have claim system edits to prevent and detect overpayments. Additionally, as noted in our previous audit (footnote 2), CMS did not have CCM-specific claim system edits in place.

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RECOMMENDATIONS

We recommend that the Centers for Medicare & Medicaid Services direct the Medicare contractors to:

* recover the $1,918,278 for claims that are within the reopening period, and instruct providers to refund up to $540,680, which beneficiaries were required to pay; 17 these amounts consist of:

- $1,427,930 in overpayments to providers that billed non-complex or complex CCM services more than once for the same beneficiaries for the same service periods and up to $406,080 in cost-sharing overcharges to these beneficiaries,

- $438,262 in overpayments to providers that billed for both non-complex or complex CCM services and overlapping care management services rendered to the same beneficiaries for the same service periods and up to $121,166 in cost-sharing overcharges to these beneficiaries, and

- $52,086 in overpayments to providers that billed for incremental complex CCM services associated with overpayments for complex CCM services that we identified and up to $13,434 in cost-sharing overcharges to these beneficiaries;

* based on the results of this audit, notify appropriate providers (i.e., those for whom CMS determines that this audit constitutes credible information of potential overpayments) so that the providers can exercise reasonable diligence to identify, report, and return any overpayments in accordance with the 60-day rule and identify any of those returned overpayments as having been made in accordance with this recommendation; and

* implement claim system edits to prevent and detect overpayments for noncomplex and complex CCM services.

We also recommend that the Centers for Medicare & Medicaid Services implement claim system edits at its level to prevent and detect overpayments for noncomplex and complex CCM services.

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View full report at https://oig.hhs.gov/oas/reports/region7/71905122.pdf