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OIG: New audits will focus on managed care, Medicare Advantage plans

Healthcare reform-related audits to address "emerging vulnerabilities," measure accuracy of subsidy payments and prevent fraudulent enrollment

While the government will continue pursuing allegations of fraud, waste and abuse by doctors, hospitals and suppliers in fiscal 2015, the Office of Inspector General's latest workplan turns an investigative eye on Medicare Advantage and plans sold pursuant to the Affordable Care Act, The Center for Public Integrity reported. Curbing overbilling in managed healthcare plans has become a federal priority--a new audit schedule will serve that end.     

"The OIG work plan serves as a blueprint for enforcement actions during the upcoming year and calls attention to medical initiatives officials believe are vulnerable to fraud and abuse," The Center for Public Integrity explained.

One significant concern with Medicare Advantage is inflation of risk scores, where insurers exaggerate how sick beneficiaries are to qualify for extra government money. Medicare Advantage pays higher rates for sicker patients and less for those who are healthy. OIG audits of six health plans completed in 2012 found that audited insurers couldn't support payments collected for at least 40 percent of their customers, the article added.

Federal officials admit that billions of dollars have been overpaid due to risk score inflation, but the government has never imposed significant penalties for this practice, The Center for Public Integrity noted. Officials aren't sure how much of the problem is due to fraud and how much stems from documentation lapses, according to Richard Kronick, director of Health and Human Services' Agency for Healthcare Research and Quality. Kronick previously recommended the government tighten its audit standards to reduce inappropriate payments to Medicare Advantage organizations.

The OIG also announced healthcare reform-related audits to address "emerging vulnerabilities." These audits will measure the accuracy of subsidy payments and the adequacy of controls to prevent fraudulent enrollment.

The Medicaid program also deserves additional integrity risk management, in the OIG's view. "Protecting an expanding Medicaid program from fraud, waste and abuse takes on a heightened urgency as the program continues to grow in spending and in the number of people it serves," the workplan noted.  

For more:
- read the OIG's 2015 workplan   
- here's the article by The Center for Public Integrity

Related Articles:
The Medicare Advantage risk score debacle
Feds overlook billions in Medicare Advantage overpayments 
Medicare Advantage overpayments top $70B
HHS sued for access to Medicare Advantage information
Medicare Advantage enrollment grows nationwide
HHS official calls for tougher audits of Medicare Advantage plans