GAO Finds CMS Still Falls Short in Screening Potentially Fraudulent Medicare Providers

Since the adoption of the Affordable Care Act, CMS has removed 28,000 questionable providers from Medicare. But the Government Accountability Office found more needs to be done to verify addresses and weed out those who have lost their licenses.

The Government Accountability Office (GAO) has found that despite progress, CMS still falls short in weeding out potential fraud from its pool of Medicare providers, with 2 of its 4 screening steps still letting thousands of questionable applicants through the cracks.

The Affordable Care Act (ACA) required CMS to take additional steps to prevent fraud and gave it data-driven tools to do so, which the agency recently touted in an announcement that it has prevented $820 million in fraudulent payments in the past 3 years. But GAO’s report, released yesterday, says more needs to be done.

Of the 4 screenings steps, CMS is going a good job of ensuring that applicants are not on lists of deceased persons or those no longer allowed to be paid by Medicare. The agency falls short in verifying that providers have eligible practice locations and are currently licensed. Medicare providers cannot provide addresses that are commercial mail receiving agencies, such as a UPS store or a vacant lot, but GAO’s examination of 2013 data found that 23,400 of 105,234 addresses, or 22%, were potentially ineligible.

Also, CMS requires its contractors to verify final adverse actions against providers, such as the suspension or revocation of a license. These actions are taken by state licensing boards. While providers are required to self-report such steps, in March 2014 CMS began providing reports to contractors to make sure these providers were removed. GAO, however, found that 147 out of 1.3 million physicians listed as eligible to bill Medicare who had received a final action as of March 2013 who were not revoked for months or at all.

GAO called for CMS to add better flags to its software to identify questionable addresses and to update it guidance for verifying practice locations. HHS agreed to 2 recommendations, including the call for software modifications, but objected to the new guidance. In its response, HHS said that since the adoption of the ACA, it had made 250,000 site visits to check on questionable locations of practices and suppliers, and removed 28,000 participants from the Medicare program.