CMS, Congress To Ramp Up Quality Enforcement In 2009

CMS and Congress will be focusing more on regulatory compliance matters in 2009 than they have in years, according to Brian Flood, managing director at KPMG. "You have a lot of activity going on in the next six months," he said during a recent American Bar Association teleconference. One area CMS has focused its quality measures and enforcement efforts on is improper claims for Medicare payment, where regulators are belatedly ramping up scrutiny of the managed care industry, which has grown to cover more than 37 million state and federal beneficiaries.

CMS recovery audit contractor program pilot identified $371.5 million in improper Medicare payments in three states. CMS plans to expand the number of states beginning in early 2009 and expand the program nationwide by January 1, 2010. Moreover, Congressional lawmakers on both sides of the aisle are promising to focus on Medicare fraud in 2009, Flood noted. Both comparative effectiveness and pay-for-performance models are under discussion, which could result in "negative consequences for [companies that do not have] high quality programs or cost effective programs," he said. Flood added that underperformers could be penalized with lower Medicare reimbursement rates of between two and five percent.

Under the Medicare Improvements for Patients and Providers Act of 2008 (PubLNo 110-275), there are new risk areas within the organization, especially with a provision that ties safety and quality measures to the financial statement of the institution. "Under the pay-for-performance models, if those measures are not up to standard (that is, 80 percent accurate) and if you're in a top tier provider category, you won't get paid the same as your competition," Flood said. The law provides $10 million a year from fiscal years 2009 through 2012 from the Medicare trust funds to fund the process.