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Office of Inspector General report shows billions of dollars in Medicare Advantage payments were based on incomplete data

A new report from the federal Office of the Inspector General shows that CMS made billions of dollars of risk adjustment payments to Medicare Advantage organizations based solely on chart review data, which do not include service records of patients actually receiving care. Risk adjustment payments are made by CMS to MAOs that have relatively sicker enrollees. The payments are to balance out the higher costs of care associated with those higher-need beneficiaries. However, the OIG report indicates that MAOs may be incentivized to make their beneficiaries appear as sick as possible to take advantage of higher risk adjustment payments. This report found that chart review data was almost exclusively used as a tool to add rather than delete diagnoses to patient records, and that CMS based an estimated $2.7 billion in risk adjustment payments on chart review diagnoses that were not linked to services or face-to-face visits provided to beneficiaries. Contact: Anna Sapak

Published December 13, 2019