New Tools to Fight Medicare Fraud

 

The Affordable Care Act (ACA) provides tools to help prevent fraud, waste and abuse in Medicare, Medicaid and the Children’s Health Insurance Program (CHIP).  The Centers for Mediare & Medicaid Services (CMS) is proposing new regulations to implement some of the Affordable Care Act’s most significant anti-fraud provisions.

Using the new tools in the ACA, CMS will be able to identify and stop fraud on the front end, keeping unscrupulous actors out of the programs to begin with. More stringent enrollment screening requirements, improved data sharing, and the ability to suspend payments where there is credible allegation of fraud are some of the key new tools. The goal of these new tools and authorities is prevention, using new technologies and methods to stop fraud before it starts instead of paying claims now and chasing down criminals later. These new activities will not disrupt business for legitimate providers, and will not disrupt beneficiary access to needed services. 

The Centers for Medicare & Medicaid Services (CMS), the agency in the Department of Health and Human Services that administers these health insurance programs, is using new authorities under the Affordable Care Act to transition its anti-fraud activities from a pay and chase model to a new focus on fraud prevention. 

New Tools in the Affordable Care Act: The new and strengthened provisions outlined in these  rules will help to assure that only legitimate and qualified providers and suppliers are enrolled in Medicare and Medicaid, and that only legitimate claims will be paid.  CMS new proposed rules:

  1. Enhance and outline the rules for suspending payments to suppliers and providers when fraud is suspected;
  2. Establish the authority to deny providers and suppliers the opportunity to enroll in and bill the Medicare, Medicaid, and CHIP programs when necessary to help prevent or fight fraud, waste, and abuse;
  3. Strengthen and build on current provider enrollment rules to ensure potential providers and suppliers are appropriately screened according to the risk of fraud, waste, and abuse before being allowed to enroll in and bill Medicare, Medicaid and CHIP;
  4. Outline requirements for States to terminate providers from Medicaid and CHIP when terminated by Medicare or another State Medicaid program or CHIP;
  5. Authorize CMS to terminate providers and suppliers from Medicare when terminated by a State Medicaid program; and
  6. Solicit input on how best to structure and develop provider compliance plans, now required under the Affordable Care Act, that will ensure providers are aware of and comply with CMS program requirements.

Other Fraud-Related Provisions in the ACA

Stopping Payment of Suspected Claims: The new law allows the Secretary, in consultation with the Office of the Inspector General (OIG), to withhold payment to any Medicare or Medicaid providers or suppliers if a credible allegation of fraud has been made and an investigation is pending.  The law also allows States to withhold payments to Medicaid providers in the same circumstances.

New Resources to Fight Fraud: The Affordable Care Act provides an additional $350 million to hire new officials and law enforcement agents to fight fraud in the health care system.

Sharing Data to Fight Fraud: Building on the Obama Administration initiatives, the law requires data from Medicaid, Veterans Administration, Department of Defense, Social Security Disability Insurance, and Indian Health Service to be centrally housed, thereby making it easier  for law enforcement officials to identify criminals and prevent fraud on a system-wide basis.   The Department of Justice (DOJ) and the OIG will also have access to more data to help identify criminals and fight fraud.

New Tools to Prevent Fraud: The Affordable Care Act requires providers and suppliers to establish plans detailing how they will follow the rules and prevent fraud as a condition of enrollment in Medicare, Medicaid, or CHIP. Other preventive measures focus on high fraud-risk providers and suppliers including Durable Medical Equipment (DME) suppliers, home health agencies, and Community Mental Health Centers (CMHCs). For example, CMHCs will now be required to serve at least 40 percent non-Medicare beneficiaries to crack down on centers that only bill Medicare and are not legitimate CMHCs.

Expanded Overpayment Recovery Efforts: The law makes it easier to identify and recover overpayments through the expansion of Recovery Audit Contractors (RACs) to Medicaid, Medicare Advantage and Part D (the Medicare drug benefit). Providers, suppliers, Medicare Advantage plans, and Part D plans must self-report and return Medicare and Medicaid overpayments within 60 days of identification.

Enhanced Penalties to Deter Fraud and Abuse: The Affordable Care Act provides the OIG with the authority to impose stronger civil and monetary penalties on those found to have committed fraud.

Greater Oversight of Private Insurance Abuses: The new law also provides enhanced tools and authorities to address abuses of multiple employer welfare arrangements and protect employers and employees from insurance scams. It also gives new powers to the Secretary and Inspector General to investigate and audit the health insurance Exchanges. This, plus the new rules to ensure accountability in the insurance industry, will protect consumers and increase the affordability of health care.

- From “New tools to fight Medicare fraud; CMS proposes new regulations to strengthen fraud prevention efforts”, http://www.healthcare.gov/news/factsheets/tools_to_fight_fraud.html, retrieved 10/1/10, and from “The Affordable Care Act: New Tools to Fight Fraud, Strengthen Medicare and Protect Taxpayer Dollars”, http://www.healthcare.gov/news/factsheets/new_tools_to_fight_fraud.html.

10/10