In December 2010, the agency proposed an audit methodology for its Risk Adjustment Data Validation, or RADV, program and has since received about 500 public comments on its proposal, Jonathan Blum, deputy administrator and director for the Center for Medicare at the CMS told Modern Healthcare.
In this new initiative, the CMS will identify 30 plans each year that analysts will examine in order to calculate a plan-specific error rate. “And based on that sample, we will calculate the overpayment,” Blum explained. “This is an audit process we will conduct after the fact,” he said, adding that the effort aims to achieve three goals: to create a process that is fair to Medicare Advantage plans; to return overpayments to the Medicare trust fund; and, ultimately, to change the behavior of Medicare Advantage plans so they (the plans) ensure that the diagnoses codes they submit to the CMS are accurate, which will drive down the overall error rate.
According to Blum, the CMS has done some test sample auditors to develop the methodology, and the first audit—for which the 30 plans have not yet been selected—will start with 2011. And although each audit process could take as long as a year and a half to two years, the CMS will still choose a new sample of 30 plans each year. “We will over-sample those coding the most aggressively,” Blum said. “We’re going to target those.”