WASHINGTON – The Medicare recovery audit contracting (RAC) project has some accountability, integrity and reliability shortcomings, according to a new report issued by the Government Accountability Office (GAO).
The Centers for Medicare and Medicaid Services (CMS), the federal agency responsible for overseeing the RAC program, has not addressed vulnerabilities to improper payments, the GAO said in a report to Congress on Wednesday.
The GAO report claims that CMS did has not established an adequate process for addressing "RAC-identified vulnerabilities that led to improper payments." These vulnerabilities include paying duplicate claims for the same service, according to the report.
CMS had planned to use its RAC demonstration project conducted from March 2005 to March 2008 to obtain information to help prevent improper payments, but they have fallen short, the GAO report found.
According to the GAO, CMS has not yet implemented corrective actions in the national RAC program, begun in March 2009, for 60 percent of the most significant RAC-identified vulnerabilities that led to improper payments.
"These were vulnerabilities for which RACs identified over $1 million in improper payments for medical services or $500,000 for durable medical equipment," the report said.
CMS did not address significant vulnerabilities representing $231 million in overpayments identified by the RACs during the demonstration project, according to GAO.
GAO said CMS has made positive steps toward correcting the problem. The agency has developed a process to compile identified vulnerabilities and recommend actions to prevent improper payments. "However, this corrective action process lacks certain essential procedures and staff with the authority to ensure that these vulnerabilities are resolved promptly and adequately to prevent further improper payments," the GAO said.
CMS learned during the RAC demonstration project that the data warehouse used to store claims information for the RACs needed more capacity and utility. As a result, CMS tried to improve this with the national program by enhancing the existing data warehouse and automating the claims-adjustment process.
The GAO recommended that CMS improve its corrective action process by designating responsible personnel with authority to evaluate and promptly address RAC-identified vulnerabilities to reduce improper payments.
Officials from CMS said they agreed with GAO's recommendations.
