2018 Medicare Improper Payment Report Shows Slight Improvement but There's Still Work to be Done

June 27th, 2019 - Wyn Staheli, Director of Research
Categories:   Compliance   Documentation Guidelines   Medicare  
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The Medicare Improper Payment Report for 2018 is not a measurement of fraud. Rather, it is an estimate of the claims paid by Medicare which did not meet Medicare coverage, coding, and billing rules. The estimated Medicare FFS payment accuracy rate (claims paid correctly) from July 1, 2016 through June 30, 2017, was 91.9 percent. If we were in school, that would be like saying that we are at an A-. Not bad, but there is still some room for improvement.

The estimated improper payment rate (claims paid incorrectly) was 8.1 percent which shows a decreasing trend (12.1 percent in 2016 and 9.5 percent in 2017). Again, good news. But where can we improve to get that "A" grade? The answer is documentation! Insufficient documentation accounts for 58% of all those improper payments.

Table A2: Comparison of 2015 and 2016 National Improper Payment Rates by Error Category (Adjusted for Impact of A/B Rebilling)

 

2017

2018

       
Error Category

Total

Total

Part A Excluding Hospital IPPS

Part A Hospital IPPS

Part B

DMEPOS

No Documentation

0.2%

0.2%

0.1%

0.0%

0.1%

0.0%

Insufficient Documentation

6.1%

4.7%

2.1%

0.3%

1.8%

0.5%

Medical Necessity

1.7%

1.7%

1.0%

0.7%

0.1%

0.0%

Incorrect Coding

1.2%

1.0%

0.1%

0.2%

0.6%

0.0%

Other

0.3%

0.5%

0.2%

0.0%

0.1%

0.1%

TOTAL

9.5%

8.1%

3.5%

1.3%

2.9%

0.7%


While the numbers for insufficient documentation has decreased, the percentage of claims with no documentation remained the same. This is something that can easily be remedied. Every patient encounter needs to be documented! If you are unsure about what you are missing in your documentation, take time to review your payer's guidelines.

According to the report, the following are the most common causes for "insufficient documentation" errors for all types of claims:

For Part B claims, the top “insufficient documentation” errors were that documentation was NOT submitted at all for the following:

  1. Documentation to support medical necessity
  2. A valid provider’s order, or element of an order
  3. Valid provider’s intent to order (for certain services)
  4. Documentation to support the services were provided or were provided as billed
  5. Documentation of the result(s) of the diagnostic or laboratory test(s)
  6. A signature log of medical personnel to support a clear identity of an illegible signature or there is not a provider's written attestation of the unsigned or illegible signature

Take time to learn from other people's mistakes. Review your policies and procedures and conduct your own internal audit. If you find that you are missing records or information, be sure to appropriately make an addendum to the patient record with the current date and time. NEVER backdate anything.

To see how your specialty ranks, go to the report (see References below) and search (Ctrl+F) for your specialty.

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