Medicare Advantage Plans Scrutinized More in CMS Audits

Private insurers managing Medicare Advantage plans likely will be scrutinized more intensely as the Centers for Medicare & Medicaid Services seeks to rectify a "longstanding problem" of improper payments.

CMS recently said it may have overpaid Medicare Advantage plans by as much as $12.4 billion in 2011, amounting to an 11% error rate, compared to an 8.6% rate in traditional Medicare, reported Bloomberg.

To help reduce that error rate, CMS auditors will examine 30 plans to determine whether clinical records justify payments for medical services. The auditors will review 200 patients' medical records and calculate the percentage of improper payments. Medicare will then reduce future payouts to the insurer to recoup any overpayments.

"We're absolutely confident that this is a valid sample to do these audits," Medicare Deputy Administrator Jonathan Blum told Bloomberg.

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Source: FierceHealthPayer; Bloomberg