On Wednesday, Senate leaders from both sides stated that the Medicare claims review process is burdening providers and failing to improve program integrity. Although CMS has increased audits, the improper payment rate continues to increase. The problem may be that Recover Audit Contractors are paid based on their recoveries of improper payments, which may provide “an incentive to keep improper payment rates high.” Lawmakers suggest that RACs be compensated through a system that tracks their “effectiveness at reducing improper payment rates over time.” Furthermore, different types of audit contractors have been targeting the same areas for potential fraud errors, leading to duplicative investigations that burden above-board providers. Senators suggest that CMS make better use of information from the Comprehensive Error Rate Testing system and then instruct different types of auditors to focus on different issues.
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