CMS accelerates MA audits 

WASHINGTON – CMS plans to increase its team of medical coders from 40 to about 2,000 by Sept. 1 as part of a significant expansion of its auditing efforts for Medicare Advantage plans. 

These coders will manually verify flagged diagnoses to ensure accuracy, the agency says. 

“We are committed to crushing fraud, waste and abuse across all federal healthcare programs,” said Dr. Mehmet Oz, CMS Administrator. “While the administration values the work that Medicare Advantage plans do, it is time CMS faithfully executes its duty to audit these plans and ensure they are billing the government accurately for the coverage they provide to Medicare patients.” 

Medicare Advantage plans receive risk-adjusted payments based on the diagnoses they submit for enrollees—meaning higher payments for patients with more serious or chronic conditions. To verify the accuracy of these claims, CMS conducts Risk Adjustment Data Validation (RADV) audits to confirm that diagnoses used for payment are supported by medical records. 

Currently, CMS is several years behind in completing these RADV audits. The last significant recovery of MA overpayments occurred following the audit of payment year (PY) 2007, despite federal estimates suggesting MA plans may overbill the government by approximately $17 billion annually.  

In addition to the workforce expansion, CMS will: 

• Deploy advanced systems to efficiently review medical records and flag unsupported diagnoses. 
• Increase its audits from about 60 MA plans a year to all eligible MA plans each year in all newly initiated audits (approximately 550 MA plans). It will also increase from auditing 35 records per health plan per year to between 35 and 200 records per health plan per year in all newly initiated audits based on the size of the health plan. 
• Collaborate with the Department of Health and Human Services Office of Inspector General (HHS-OIG) to recover uncollected overpayments identified in past audits.