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Problems Plague Medicare's Method for Measuring Payment Errors
Date:6/8/2012

WASHINGTON, June 8, 2012 /PRNewswire-USNewswire/ -- The American Association for Homecare reported in this week's Mobility Matters publication that the U.S. Department of Health and Human Services (HHS) has uncovered serious flaws in the methodology used to calculate the error rate on payments for services and products provided to Medicare patients.

In a March 9 study, the HHS Office of Inspector General (OIG) concluded that improper fee-for-service Medicare payments reported to Congress for fiscal years 2009 and 2010 should have been reduced by about $2 billion each year. The reason for the discrepancy is that thousands of denied claims cited as improper payments were later overturned and paid during the appeals process.

The Comprehensive Error Rate Testing (CERT) program, which annually calculates the Medicare error rate on payments, monitors how often the Centers for Medicare and Medicaid Services (CMS) denies payments to hospitals and providers because it was determined that proper reimbursement and coverage criteria weren't used.  The government acknowledges that CERT was designed to measure Medicare billing errors – not fraud or abuse. 

The Mobility Matters article said the OIG study is significant because the findings underscore the extent of the flaws in the CMS reimbursement and documentation policies.  Under the current process, CMS is denying reimbursement claims for home medical equipment, such as oxygen therapy, hospital beds, and power wheelchairs, unless certain guidelines are met.

Clearly, however, the number of successful appeals at three different levels – Medicare Administrative Contractor, Qualified Independent Contractor, and Administrative Law Judge – demonstrates that other authorities disagree with the way CMS and its contractors are reviewing claims. One major problem is the lack of a consistent
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SOURCE American Association for Homecare
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