New Rules Slash Improper Pay

The Medicare fee-for-service (FFS) error rate dropped from 12.4 percent in 2009 to 10.5 percent, or $34.3 billion, in estimated improper claims payments for 2010, according to the Centers for Medicare & Medicaid Services (CMS). The federal agency credits the implementation of more stringent review criteria for measuring claims.

CMS says primary causes of errors in the Medicare FFS program for 2010 are insufficient documentation and medically unnecessary services. CMS contributes the declining error rates to stricter adherence to the documentation requirements outlined in Medicare regulation, statute, and policy, rather than allowing for clinical review judgment based on billing history and other available information.

The error rate for Medicare Advantage also declined and a new component measure was developed and reported for the Part D program.

CMS plans to report a composite error estimate for Part D beginning in 2011. A press release, issued by CMS Nov. 16, has more on this.

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