I have covered this a couple of times and it appears now that Medicare is wanting get their money back from the risk fiddling insurers and when it comes to algorithms and fraud, nobody does it better, right? Well they have all the secrets as they audit their own claims and files for the same thing so they kind of know what can be buried in a bunch of algorithms. It took CMS 5 years to figure it out. Now that we have Andy Slavitt running CMS, who’s totally a numbers guy and did some of the same modeling at Ingenix, well here it comes.
We can all go back to the Ingenix legal cases to where they used algorithmic formulas, many of which turned up false positives to accuse folks of cheating and I’m sure there were some that did, but long and short the AMA class action suit proved that Ingenix was using risk fiddling factors that short paid doctors and patients on out of network charges for 15 years. So my opinion here on this is now we have the expert at the helm of such models and a rerun of risk fiddler factors is in the works.
I just might add that perhaps the insurers didn’t expect CMS to ever take any action on this as there’s the big possibility of benefits to be cut from seniors covered or a hike in premiums. Nothing’s for free out there today and those are the normal paths taken to recover money and people get the losing end of big business fiddling with algorithms and code.
CMS Discovers That Insurers Offering Medicare Advantage “Really Know How To Sharp Shoot A Model With Adjusting Risk For Profit”, A Common Everyday Occurrence in Financial Markets…
This is also being pushed I think due to the whistle blower suits that are being filed as well stating that there were automated risk fiddler factors built in and I remember seeing a news article talking about how seniors had more alcohol problems than we thought..so we might ask the question here, do they really or was it risk fiddling to put the payments into a higher bracket..hmmmm…what a question.
So again what’s the exposure here for providers and patients. That remains to be seen as you don’t think insurers are going to eat all of this even though they may have been proactive in promoting risk fiddling do you? Of course not as so many of them are 
involved in stock buy backs now (which you also pay for) to increase the value of their stock and and enrich CEO compensation. Maybe we should ponder this, can the networks get any narrower with insurer quants squeezing out every dime they can find?
Insurance Carrier stock Buy Backs Continue to Rise While Consumers Are Finding It Harder to Afford Some Policies and Care With Dealing With High Deductibles And Narrow Networks…
In the financial world you don’t change the portfolio to squirrel around with risk to attain profit, you just change the math. In the insurance world you don’t squirrel around with the policy, you just change the math, same thing and put people through absolute misery to do this.
“Medicare pays the Advantage health plans higher rates for sicker patients and less for healthy people using a complex formula called a “risk score.” But the HHS study spells out several ways health plans have inflated those scores, from reporting surprisingly high levels of medical conditions such as alcohol or drug dependence to billing for an inordinately high number of patients with complications of diabetes.”
Stay tuned as to the progress on when this is going to occur this year and you might want to see what your exposure could be as a provider or a patient even if you had some major bills. I thing the government might be easy on the patients though. From what I read from the letter, CMS is going to deduct from future payments. It’s the same old nightmare United does in taking money from current claims to charge back old claims and it’s a nightmare for physicians in their accounting everywhere.
“CMS will sweep diagnoses submitted for a prior payment year as of the deadline. MA Organizations should look to the monthly payment letter to determine when adjustments will be applied to payments.”
So here’s job one from Andy Slavitt, the new CMS director with the Medicare Advantage money take back. Again when Andy Slavitt was with Ingenix, this was a primary function that company (a sub of United) provided to audit for fraud, just now the tables are turned and he’s going to be running algorithms to raise money for the government. A while back both Humana and United discussed setting some money aside for this. BD
On March 3, Cheri Rice, CMS’ Director of Medicare Plan Payment Group, released a memo notifying all Medicare Advantage Organizations, PACE Organizations, and certain Demonstrations of its intent to rerun risk scores during the calendar year 2015.
The memo was brief and a bit vague, but the impact to health plans and providers could not be clearer. CMS will be rerunning risk score data and the corresponding payments made to plans dating back to 2008 Dates of Service (DOS), payment year 2009. Additionally, the memo anticipates that plans will clean up their data by submitting deletes. This could raise the specter of false claims if a plan fails to submit deletes when they knew, or should have known, of unsubstantiated risk adjustment submissions. This could get ugly, and fast.
http://www.healthcarepayernews.com/content/money-grab-cms-rerun-risk-scores-recovery
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