The long awaited Risk Adjustment Data Validation (RADV) final rule that went into effect April 3, outlines the RADV audit methodology and policies governing the contract level Medicare Advantage audits. Within it, the Centers for Medicare & Medicaid Services (CMS) states it has an obligation to ensure the payments in the Medicare program are accurate to safeguard taxpayer dollars. RADV audits play a critical role in being able to meet these requirements. The sole purpose of these audits is to recover improper payments made to Medicare Advantage Organizations (MAOs) as a result of unsupported or non-documented diagnoses.
CMS plans to use statical modeling and data analytics to create an RADV audit sample based on contracts and enrollees that are calculated as having the highest risk for improper payments. CMS will begin to extrapolate dollar amounts of overpayments identified through both contract RADV and U.S. Department of Health and Human Services-Office of Inspector General audits beginning with the PY2018 audit. This means that the payment error for the sample of the contracted enrollees can be calculated across all enrollees from which the sample that was selected. CMS is predicting that in 2025 it will see $479.5 million in its extrapolated recovery results! Given these staggering numbers, CMS believes that the use of extrapolation will incentivize MAOs to take meaningful steps to reduce future improper payments.
Here are 10 easy tips to help MAOs prepare in advance of a regulatory audit:
- Ensure that you have proper policies and workflows and tools in place to respond to regulatory audits.
- Research innovative vendors and/or consultants that offer the latest technology and methodology to assist you in advance of an audit.
- Contact and contract with medical record retrieval companies to assist with the gathering of medical records.
- Test your current audit response process with a mock RADV audit and use those results to respond to deficiencies and challenges.
- Retrospectively audit highly suspect diagnosis codes. Tip: Use trends from OIG workplan and identify HCCs only billed once per calendar year to create an audit plan. Use this audit plan to sweep back to the year 2017 at a minimum. Return any identified overpayments within 60 days in compliance with the Federal Register / Vol. 79, No. 100
- Prepare your providers by reminding them of legal time requirements around saving medical records and their obligation to send medical records in response to regulatory audits.
- Increase your coder and vendor oversight by increasing the number of quality reviews and consider increasing your acceptable quality rate.
- Review your internal coding compliance guidelines and continue to provide coding education to your internal coding teams and vendors.
- Provide robust provider education by utilizing feedback on audit findings to guide targeted education initiatives.
- Attend RISE events to engage with your fellow peers and risk adjustment experts and educate yourself on the latest industry trends!
Embracing a coding compliance philosophy and taking steps to address deficiencies in your process today will prepare you for tomorrow’s audit. Retrospectively reviewing for diagnosis coding errors and returning identified overpayments will prevent future regulatory audits and extrapolation penalties. Take heed from CMS guidance! The agency is analyzing for high risk of improper payments, and MAOs need to be doing so, as well. Today is the day to start taking meaningful steps to reduce future improper payments.
About the author
Kimberly Rykaczewski, RN, BSN, CPC, CRC, clinical content management–medical terminology & risk adjustment, Wolters Kluwer, Health Language, manages a team focused on providing data quality solutions by monitoring regulatory coding content and providing diagnostic and procedural mapping sets.
She has over 20 years of health care experience in the areas of nursing, case management, utilization review, overpayment recovery, vendor management, coding and billing, risk adjustment, and regulatory compliance. One of the biggest rewards of her profession is bringing providers and payors together to achieve regulatory and coding compliance.
Rykaczewski holds a Bachelor’s of Science in Nursing and is an AAPC certified professional and risk adjustment coder.