Posted on 07/02/2015 1:21:17 PM PDT by Red Badger
The Center for Medicare and Medicaid Services secretly paid out over a billion dollars in improper hospital claims earlier last month, despite auditors labeling them unnecessary previously.
The payments, which were quietly announced on June 1 by CMS, totaled $1.3 billion and involved 1,900 hospitals and 300,000 claims that had been already denied by CMS auditors on two different levels as medically unnecessary.
The Department of Health and Human Services Office of Medicare Hearings and Appeals settled hundreds of thousands of appeals for 68 cents on the dollar. The money used to cover the claims will be taken from the Medicare Trust Fund. The hospitals that received the settlements were also not announced by CMS.
Citizens Against Government Waste, a nonpartisan organization dedicated to eliminating waste, fraud, mismanagement, and abuse in government, first noticed the payments.
The group says the process has been questionable from the beginning, with a majority of the claims related to short impatient stays—an area considered extremely vulnerable to improper payments.
“The settlement process was murky from its inception. On August 29, 2014, CMS announced the global financial settlement for hundreds of thousands of Medicare fee-for-service claims that had been denied twice and then appealed by providers to the third level of appeals, the administrative law judges (ALJ),” CAGW wrote. “The vast majority of these claims were related to short inpatient hospital stays (an area that had been identified by CMS as highly vulnerable to improper payments), and had been denied at two lower levels, including by Recovery Audit Contractors (RACs).”
Office of Medicare Hearings and Appeals Chief ALJ Nancy Griswold testified in April before Congress about the drastic jump in OMHA’s workload.
During the testimony before the Senate Finance Committee, Griswold said between fiscal year 2009 and fiscal year 2014, the workload within the office increased by 543 percent. Additionally, the number of appeals OMHA received jumped from 384,000 in fiscal year 2013 to 474,000 appeals during fiscal year 2014.
Citizens Against Government Waste president Tom Schatz called the lack of transparency in the quiet settlements a cause for concern for taxpayers.
“This $1.3 billion settlement is indicative of how endangered program integrity efforts are at CMS,” Schatz said in a statement. “The lack of transparency in the hospital settlement process should be a cause of major concern to taxpayers, members of Congress, and Medicare beneficiaries.”
“Furthermore, the suspension of RAC audits, coupled with this settlement, means that a portion of the $9.7 billion in improper payments that have been recovered by RACs for the Trust Fund over the last several years has now been sent back to the very providers who systematically flooded the OMHA with appeals over denied claims. Providers have not only managed to fend off oversight of hundreds of thousands of potentially improper claims, they have been rewarded financially for doing it. This is a terrible precedent and deserves a full investigative hearing before jurisdictional committees,” he concluded.
CMS did not return a request for comment by press time.
Yeah.............
And how much of this dough gets put back into the campaigns of Dem candidates to make sure Obamacare stays put?......................
A damn good chunk of it, for sure.
Don’t believe it. CMS hires auditors who are paid by how much they disallow. Then the hospitals appeal and end up getting paid after a long and tortuous battle.
Its a huge and colossal mess but hospitals aren’t the ones making out. Its organizations that sell medical supplies. Take Wellcare here in Tampa. Partly owned by Soros and the Saudis. They previously admitted to massive fraud, paid a small fine and keep on trucken.
This article misses the underlying issues that are - legitimately - much more complicated than they are asserted to be. The entire RAC audit process itself is subjective and inconsistent, the specific standards are unclear and the private auditors are incentivized to take overly severe positions, causing providers to appeal administrative determinations.
The audit appeals process itself is very difficult, lengthy and costly, and the administrative process thereafter will end up in court.
In my opinion, CMS’ decision to settle this now on these terms probably actually is in the best interests of the government and tax payers. It is the private audit firms that are squealing now because they won’t collect the level of bounties that they dreamed of collecting.
all the RAC’s charge the feds/states/Health plans between 10% to 25% of the dollars recovered e the quite the scam they got going
Of course, the out-of-pocket for the Medicare recipient is much different for the two classifications. If only for observation, rather than the Medicare Part A (capping at around $1300 patient co-payment) paying, Medicare Part B pays along with all of their co-pays for each procedure. There is also no nursing home from hospital benefit if under "observation".
The hospitals are caught in a catch-22 as are the Medicare recipients.
all the RAC’s charge the feds/states/Health plans between 10% to 25% of the dollars recovered e the quite the scam they got going”
And it is a racket since the RAC’s are not punished for bringing up cases where NO true abuse/fraud exists.
About 7 years ago I was audited in California and was sent the certified letter “ Dr we have questions about 42 patients”. Of course their judgement was “insufficient documentation” on all 42.
Contact my lawyer at $6-8k and am told it will now go to the same auditor for review. Be prepared he says , 100% of those cases are upheld. Wait a year and my 42 cases are now brought up before a retired judge for adjudication( nice legal word) , he takes 10 minutes to look at my notes and rules for me in all 42 cases. My lawyer says you (meaning me) should be pleased. I almost tear his head off. After 2 and 1/2 years and $8k in legal fees I have the privilege of being able to sleep at night once more. I forgot to mention if the judge would have found for the RAC the proportionate amount of like case ARE DEEMED LIKELY FRAUDULENT and they demand a check for $120k right now before you leave the court room..
Meanwhile the RAC auditor sits at his desk, scratches his scrotum and says “oh well I guess I will go on to the next Doc/Hospital
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