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OIG and CMS Clash on Medicare Overpayment Recoveries

by | Aug 10, 2022 | News, Open Content

OIG says the agency is leaving millions of dollars on the table, but CMS doesn’t want to hear it.

It’s not all harmony and bliss in the federal fraud fighters’ camp. A new report from the U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) blasts the Centers for Medicare & Medicaid Services (CMS) for not doing enough to recover the Medicare overpayments its auditors are uncovering. It’s a message that CMS has heard before and clearly is sick of hearing again, bristling at the findings and rejecting most of the recommendations contained in the report. That report concluded that CMS has collected only 55 percent of overpayments identified over a review.

According to OIG, CMS collected only $272 million (55 percent) of the $498 million in Medicare overpayments identified in HHS-OIG audit reports issued during the October 1, 2014, to December 31, 2016 review period. In effect, CMS left $226 million (45 percent) in overpayments on the table. And even the $272 million reportedly collected was a bit shaky, given that the records it provided the OIG documented collection of only $120 million. CMS didn’t provide adequate documentation to support collection of the remaining $152 million, the OIG says.

This echoes a May 2012 OIG report finding that CMS failed to collect $332 million of the $416 million worth of overpayments identified in audit reports issued during the 30-month period ending March 31, 2009. To make matters worse, the OIG concluded that it couldn’t verify the $84.2 million that CMS reported that it did collect and that it found inaccuracies in the reported amount.

OIG chided CMS for not taking corrective action in response to the May 2012 report, contending that the agency still doesn’t have one of the primary components of an effective internal control system, namely, “adequate policies and procedures to address certain collection issues” identified by OIG audits. Without such policies and procedures, CMS can’t ensure that Medicare overpayments will be collected to the maximum extent possible. The report also calls out CMS for not providing specific guidance to its Medicare Administrative Contractors as on appropriate documentation to support overpayment collections.

In a rare public display of disharmony between federal agencies, CMS indicated its non-concurrence with seven of the OIG’s recommendations while defending its current overpayment recovery systems, policies, and procedures.

Get a more in-depth report in our upcoming September 2022 issue of National Lab Reporter.