Healthcare industry asks feds for clearer guidance on fraud, fewer audits

    Joe Carlson

    Posted: April 24, 2013 – 6:45 pm ET
    After sifting through 2,000 pages of public comments, staff members for the Senate Finance Committee say the healthcare industry wants clearer rules, fewer redundant audits and more focus on proactive healthcare fraud prevention.The committee was swamped with more than 150 reports from healthcare providers, insurers and suppliers last year after asking for suggestions on ways to prevent waste and improve fraud-fighting efforts in Medicare and Medicaid. About $65 billion was lost to improper payments from Medicare in 2011, according to one government estimate.

    The request for comments came last year as a staff member for the influential Senate committee revealed that a group of senators was interested in probing the effectiveness and efficiency of the CMS’ array of independent auditing firms. Following an outpouring of criticism about costly and duplicative auditing reflected in the public comments, the senators asked the Government Accountability Office last year to audit the auditors.Kim Brandt, chief oversight counsel to the committee’s ranking Republican, Sen. Orrin Hatch, said Tuesday during the annual meeting of the Health Care Compliance Association in National Harbor, Md., that a GAO report will attempt to examine how the cost administrative burden placed on healthcare providers compares with the amount of money recovered by the audits.

    “Are all these audits worth it in the long run?” Brandt said, adding that the first of two GAO reports on the topic is slated for release in early summer.

    In total, 54 of the reports received by the committee gave recommendations addressing the audit burden on healthcare providers, including numerous calls for the CMS to simplify and standardize the auditing process and provide better examples of how to document medical necessity for Medicare procedures.

    Meanwhile, more than three-quarters of all the comments addressed the related issue of how to reform the system for detecting improper payments.

    Numerous providers and insurers suggested that the CMS revise the requirements for how much money insurance companies can spend on administrative overhead, known as the medical-loss ratio, so that payers aren’t penalized for investing in fraud-prevention efforts.

    Commenters also said the CMS could allow Medicare beneficiaries at risk of abusing or diverting addictive medications to be restricted to certain providers and have their prescriptions tracked in real time.

    Jo-Ellen Abou Nader, senior director of program integrity at Express Scripts, told Modern Healthcare this month that the topic of giving contractors this ability to “lock in” high-risk prescription users has been raised numerous times with the CMS in the past.Read more: