Health Information Management

News: OIG says CMS overestimates payment error rates

CDI Strategies, March 29, 2012

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The Office of the Inspector General (OIG) says CMS incorrectly estimates payment errors in its Comprehensive Error Rate Testing (CERT) program, according to a March 9 report titled, “Review of CERT Errors Overturned Through the Appeals Process for Fiscal Years 2009 and 2010.”

The latest CERT report was released in November 2011 and focused on fiscal year 2010. It found an improper payment rate of 10.5%, representing $34.3 billion, according to the “forward” of that report. Errors were due to clinical care and procedures provided in an inpatient setting which should have been provided in an less intensive setting, and a large percentage of medically unnecessary errors were related to hospital stays of short duration, among other items. In the report, CMS also says the error rates do not include late documentation/appeals adjustment.
 
In its findings the OIG said that “CMS could improve the accuracy of its error rate estimations if it took into account the denials that were overturned on appeal. …If these overturned CERT claim payment denials had been included in the initial error-rate calculations, the estimated value of reported errors for FYs 2009 and 2010 would have decreased by approximately $2 billion each year,” according to the report.



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