OIG Announces Concern over Bonus Payments for Chart Reviews to MA Plans

Date: December 28, 2019

In a December 2019 report, the Office of the Inspector General (OIG) for the US Department of Health and Human Services (HHS), noted concern over payments to Medicare Advantage Plans (MA) related to billions of dollars of bonus payments related to Risk-Adjustment audits.  The OIG noted the following in the report (link here):

The risk adjustment program is an important Medicare Advantage (MA) payment mechanism. It levels the playing field for MA organizations (MAOs) that enroll sicker beneficiaries who need a more costly level of care. This helps to ensure that sicker beneficiaries have continued access to MA plans. Chart reviews can be a tool to improve the accuracy of risk-adjusted payments …

OIG’s concerns over the risk-adjustment payments were many; they noted:

  • MAOs almost always used chart reviews as a tool to add, rather than to delete, diagnoses—over 99 percent of chart reviews in our review added diagnoses.
  • Diagnoses that MAOs reported only on chart reviews—and not on any service records—resulted in an estimated $6.7 billion in risk-adjusted payments for 2017.
  • … CMS has not validated diagnoses or reviewed the financial impact …
  • [OIG further noted:]
    • … there may be a data integrity concern that MAOs are not submitting all service records as required … [that] there may be a payment integrity concern if diagnoses are inaccurate or unsupported—making the associated risk-adjusted payments inappropriate … [and that] there may be a quality-of-care concern that beneficiaries are not receiving needed services for … serious diagnoses …

OIG recommended that “… CMS (1) provide targeted oversight of MAOs that had risk-adjusted payments resulting from unlinked chart reviews for beneficiaries who had no service records … (2) conduct audits that validate diagnoses reported on chart reviews … and (3) reassess the risks and benefits of allowing chart reviews that are not linked to service records to be used as sources of diagnoses …”

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