Healthcare Fraud
Advocates Address Claims of Waste, Fraud & Abuse
The Centers for Medicare & Medicaid Services (CMS) closed their Request for Information last week into claims of waste, fraud, and abuse into our federal public health programs. The RFI is part of a broader initiative called “Comprehensive Regulations to Uncover Suspicious Healthcare” (CRUSH), which outlines a set of enforcement and regulatory priorities that this administration is exploring to reduce funding inefficiencies nationally.
With their initiative, CMS identified a goal of strengthening fraud detection, prevention and response across our federal health care programs. They indicated areas of exploration and concern, calling attention to areas with implications for the disability community in particular: durable medical equipment, prosthetics, orthotics and supplies (DMEPOS) suppliers; artificial intelligence in coding and billing; and concerns with the federal Marketplace and Medicaid. This RFI is positioned as a step towards advancing new rules affecting the ACA Marketplace, Medicaid and Medicare.
The public comments on the RFI included submissions from a number of our trusted partners and public health advocates. We encourage you to read selections from the comments below, with the full piece linked. We will be following the implementation of new regulations affecting healthcare access over the months ahead as this initiative advances.
On Corporate Accountability:
“Federal oversight findings from HHS OIG, the U.S. Government Accountability Office (GAO), and the U.S. Department of Justice make clear that the most significant threats to Medicare and Medicaid program integrity come from organized provider fraud and market-based schemes, not from individual beneficiaries. These investigations have uncovered networks in which marketers, brokers, telemedicine platforms, laboratories, and equipment suppliers collaborate to generate medically unnecessary claims. These examples provide compelling evidence that the misaligned financial incentives of our health care payment and delivery system are a far greater vulnerability for fraudulent billing schemes than the concern that low-income families and seniors might improperly receive health insurance coverage.” (Families USA)
Families USA identified a key area of fraud risk with the growth of Medicaid Managed Care Organizations (MCOs), which are now serving a majority of Medicaid enrollees across 42 states, accounting for over half of all Medicaid spending nationwide. Without adequate oversight of their operations, Families USA recommended these core proposals to address possible unjustified spending:
- Require MCOs to report publicly on prior authorization processes and require states to audit prior authorization denials.
- Require states to publicly post Medical Loss Ratio (MLR) reports submitted by MCOs and obligate MCOs to pay remittances to the state when they do not meet minimum MLR requirements.
- Require all states to publicly report MCO sanctions data and establish a publicly available dashboard to make data on state MCO sanctions easily accessible.
- Publicly post all approved state Medicaid contracts with MCOs.
- Develop best practice guidance for states to adopt managed care procurement policies that incentivize high-performing plans and cultivate greater competition in the managed care market
AARP added to this emphasis on corporate accountability: “CMS should require greater transparency regarding parent‑company and complex ownership structures. Although current enrollment rules require disclosure of direct and indirect owners, they do not fully capture the layered corporate relationships that increasingly characterize the post-acute and long-term care industry. Requiring clearer disclosure of parent companies and related entities would improve CMS’s ability to hold corporate owners accountable for systemic misconduct and deter fraudulent actors from shifting ownership structures to avoid detection.” (AARP)
On Decision-Making and AI
The National Association of Medicaid Directors asserted that machine learning could play an important role in provider accountability and fraud detection. Expanded use of AI in relationship to care was advised against by other organizations:
Medical decisions should remain in the hands of patients, their families, and their trusted providers—not third-party contractors or algorithms. Fairness, transparency, and accountability should guide all uses of AI or other algorithmic tools that make consequential decisions regarding a patient’s health, coverage, or well-being. […] We are especially troubled by arrangements that pay artificial intelligence vendors based on how much “savings” they generate, which creates a clear incentive to deny care. AARP believes AI can and should play a constructive role in Medicare, but its purpose should be to identify and stop fraudulent or improper payments—not to substitute for medical judgment or punish patients for fraud committed by providers.” (AARP)
On Durable Medical Equipment, Prosthetics, Orthotics Suppliers (DMEPOS)
“We suggest CMS conduct an annual review by CMS of DMEPOS suppliers’ advertising and marketing materials to ensure beneficiaries are instructed to work with their own doctor to be prescribed and obtain medically necessary supplies, similar to prescription drugs, and avoid advertising “free” supplies. […] On the issue of advertising “free” supplies, we suggest prohibiting use of that term in advertising. CMS can further clarify that even though a Medicare beneficiary may or may not have to pay cost-sharing for a DMEPOS supply, since it is submitted for payment via a claim to Medicare and only approved if determined to be medically necessary. The claim could later be denied, and therefore it could have a potential cost or have other implications for a beneficiary’s future benefits.” (AARP)
On Medicaid and CHIP
The Disability and Aging Collaborative (DAC) and Consortium for Constituents with Disabilities (CCD) focused their comments on Medicaid and CHIP, especially on ensuring the availability of Home and Community-Based Services. To this issue, they highlight that increased spending should not be interpreted as proof of fraud:
“Categorically identifying HCBS services as “high risk” is misleading. Increased enrollment in a particular program, increased spending on HCBS, or an increased number of direct care workers alone or in combination may be reflective of trends that have nothing to do with program integrity. HCBS spending has been increasing across the country as a direct result of decades of work by families, people with disabilities, and older adults who want to live, work, and age with dignity in their own homes and communities, alongside bipartisan federal and state efforts to rebalance funding to HCBS from institutional care. Simply put, more people are enrolled in Medicaid HCBS and fewer people are relying on more expensive institutional care.” (CCD & DAC).
CMS should strengthen Medicaid data analytics to identify and prevent fraud, including maximizing use of existing data sources (such as electronic visit verification data), determining if any additional data is needed, improving transparency and data sharing in Medicaid managed long-term services and supports, and considering whether additional quality measures (including questions in HCBS consumer experience surveys) could help identify patterns of fraud.” (AARP)
Fraud prevention is a critical part of the ongoing work that has traditionally been accomplished through a well-funded Medicaid program nationally. NAMD outlines how efforts to maintain program integrity are a critical part of its efficiency and function, including expanding the offerings of the existing Medicaid Integrity Institute (NAMD). Whenever fraud prevention is addressed, it must not open the door for vulnerable people losing access to services. Federal fraud allegations have put essential HCBS programs at risk of underfunding and program cut-offs for disabled individuals and their families. Building out a robust fraud reduction strategy must be targeted and conscientious, and not removing the essential services that allow people to live their lives and maintain their health.
“Every dollar lost to fraud or improper payments is a dollar taken away from Americans who rely on affordable coverage programs for their care. Innocent individuals should never be forced to pay the price, whether through broad-stroke efforts that withhold or defer payments to states, delays in needed care, barriers to services like home and community-based services (HCBS), or burdensome bureaucratic hurdles that jeopardize their wellbeing. (AARP)
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