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CMS Audit Season in Full Swing

The Centers for Medicare and Medicaid Services (CMS) audit season is in full swing with numerous Medicare Advantage and standalone Part D plans receiving audit notices early in the season. As a best practice, plans should be running universes often throughout the year to ensure strong knowledge of the requirements when audit notices arrive. That was relatively impossible this season, though, as CMS changed the universe reporting and expanded the number of universe submissions dramatically. The chief aim was for CMS to better ascertain compliance with regulations.

In this blog, we are focusing on what audit trends MedHOK has seen this year with Coverage Determinations, Appeals and Grievances (CDAG). We plan on covering other audit universes in the near future.

While many findings echo what we already know from the myriad of best practice memos, annual audit briefings, and what is published publicly in various civil monetary penalty letters, we do note that CMS is more closely scrutinizing a number of areas in 2015. It all points to an increasingly rigorous audit regime moving forward.

  • In 2015, CDAG has 15 audit universe reports. While CMS published these reports a few weeks before audit season began, plans had yet to acclimate themselves fully to these new universes. More importantly, definitions were not always clear, necessitating CMS to clarify its intent in certain areas and plans to re-run universes based on more specific CMS guidance. Thus far, CMS has not counted reruns related to clarification of the new universes as one of three allowable attempts to avoid an Immediate Corrective Action Required (ICAR).
  • CMS is spending a great deal of time upfront to validate the universe. This is clearly a new trend and focus of CMS this year. This means plans will need to have a clear focus on validating their universes in the future.
  • Special attention on timeliness seems to be focused on two areas, although all continue to remain extremely important:
    • Effectuation date and time
    • Member written notification and verifying the true postmark date and time
  • A repeat audit finding is the misclassification of a case. Oftentimes redeterminations are inappropriately classified as coverage determinations. For 2015, CMS appears to be zeroing in on duplicate cases and the appropriate creation of redeterminations.
  • CMS continues to closely scrutinize plans regarding outreach for required medical documentation. Ideally, CMS does not want to see denials for lack of adequate medical documentation. As such, there is now an expectation on the part of CMS that plans have their Medical Director reach out to providers (for MA-PD members) that are not providing the information they need before denying for lack of clinical information. Further, it is raising the bar on requirements for adequate outreach before denial. Three clear attempts – at different points in time within the life cycle of the case – seems to be the evolving standard.
  • CMS’s focus has been on ensuring that all letters to members have clear and concise language regarding decisions and next steps. Denials must have the reason for the denial and the next steps a member can take in the appeals process. This continues to be a major focus in 2015 as well.
  • Further, CMS is requiring that approval letters have clear language regarding any quantity limits on an approved medication.
  • Formulary administration remains a major concern for CMS and continues to constitute a large share of overall audit findings and civil monetary penalties. Following transition policy guidelines to the letter is a paramount concern for CMS as well.
  • Lastly, CMS is very frustrated with plans that do not adequately document cases during audits. Auditors want to see all case information clearly documented in one system of record.

Marc Ryan

Marc S. Ryan serves as MedHOK’s Chief Strategy and Compliance Officer. During his career, Marc has served a number of health plans in executive-level regulatory, compliance, business development, and operations roles. He has launched and operated plans with Medicare, Medicaid, Commercial and Exchange lines of business. Marc was the Secretary of Policy and Management and State Budget Director of Connecticut, where he oversaw all aspects of state budgeting and management. In this role, Marc created the state’s Medicaid and SCHIP managed care programs and oversaw its state employee and retiree health plans. He also created the state’s long-term care continuum program. Marc was nominated by then HHS Secretary Tommy Thompson to serve on a panel of state program experts to advise CMS on aspects of Medicare Part D implementation. He also was nominated by Florida’s Medicaid Secretary to serve on the state’s Medicaid Reform advisory panel.

Marc graduated cum laude from the Edmund A. Walsh School of Foreign Service at Georgetown University with a Bachelor of Science in Foreign Service. He received a Master of Public Administration, specializing in local government management and managed healthcare, from the University of New Haven. He was inducted into Sigma Beta Delta, a national honor society for business, management, and administration.

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