CMS Reports $42 Billion Saved in Medicare and Medicaid
On July 20, 2016, CMS released a report that showed investments that are made in program integrity activities – such as stamping out fraud and reducing and deterring other improper payments – pay off for taxpayers and beneficiaries alike. For Fiscal Years (FY) 2013 and 2014, every dollar that was invested in CMS' Medicare program integrity efforts saved $12.40 for the Medicare program. With savings per dollar like that, Medicare and Medicaid programs have saved billions of dollars in that two-year period alone.
The report highlights CMS' significant achievements in reducing potentially fraudulent and improper payments. CMS achieved almost $42 billion in cost savings over the aforementioned two-year period by using a multifaceted approach, ranging from provider enrollment and screening standards, to use of enforcement authorities, to use of advanced analytics, such as predictive modeling.
According to Shantanu Agrawal, M.D., Deputy Administrator and Director of the Center for Program Integrity,
CMS is dedicated to promoting better care, protecting patient safety, reducing health care costs, and providing people with access to the right care, when and where they need it. This includes continually strengthening and improving Medicare and Medicaid programs that provide vital services to millions of Americans. We take our responsibility to deliver better care at a better value seriously.
In collaboration with the DOJ, HHS recently announced the largest healthcare fraud takedown in its history. In that case, HHS helped to charge 301 individuals, including 61 physicians and licensed medical professionals, with allegedly participating in healthcare fraud activities, totaling $900 million in false medical billing. A large portion of the individuals charged were involved in home healthcare, psychotherapy, physical and occupational therapy, durable medical equipment services, and prescription drug services.
CMS' efforts to proactively prevent potentially fraudulent and improper payments from being made have been increasingly effective, moving efforts away from the "pay-and-chase" method of recovering payments after they had already been made. In fiscal year 2013, savings from prevention activities represented about 68 percent of total savings. In fiscal year 2014, the portion of savings from preventing potentially fraudulent and improper payments rose to nearly 74 percent. This development means that more taxpayer dollars intended to care for the beneficiaries are not being paid at all, avoiding the need to recover improperly paid amounts from health care providers and suppliers. Preliminary information from FY 2015 indicates that CMS's program integrity efforts continue to accrue savings of this magnitude and that the portion attributed to prevention continues to increase. CMS is set to release FY 2015 numbers later this year.
According to Dr. Agrawal, CMS remains committed to implementing a robust program integrity strategy to protect beneficiaries from harm and further safeguard taxpayer funds by paying only for appropriate health care items and services. CMS tries to continuously evaluate and update its program integrity strategy. They often welcome input from beneficiaries, providers, suppliers, and others to inform possible future enhancements to the program integrity strategy. CMS encourages stakeholders to reach out to CMS at 1-800-MEDICARE (1-800-633-4227) or TTY: 877-486-2048 with your thoughts or to report potentially improper billing.