Healthcare News & Insights

2015 will bring more scrutiny for providers from CMS

The Centers for Medicare & Medicaid Services (CMS) has confirmed that 2015 will be a year of increased scrutiny for providers. One group, however, is counting its lucky stars because it’s getting a break. 

470406181That group: accountable care organizations (ACOs).

Despite CMS cracking down on providers and facilities across the board, ACOs will have some extra time to avoid penalties.

CMS scrutiny

Marilyn Tavenner, a CMS administrator, recently confirmed that the agency would indeed be pulling out all the stops next year to prevent fraud and get providers to cut down on wasteful spending, reports Healthcare IT News.

Recently, CMS has taken a lot of flack from other government oversight agencies for giving out inappropriate payments and not doing enough to investigate and reduce abuse in the system, specifically through electronic health record (EHR) systems.

As a result, CMS will be ramping up its use of new fraud detection technology and administrative powers, authorized under healthcare reform. CMS will use its predictive analytic  system to analyze claims and determine hot spots of fraud around the country.

Additionally, the agency will use its new authority to remove or block providers from the Medicare network if:

  • providers have large amounts of outstanding Medicare debt
  • a managing employee has been convicted of a felony that CMS determines could be detrimental to Medicare beneficiaries, and
  • providers appear to be engaged in fraudulent billing practices against Medicare regulations.

That means hospital leaders need to ensure their compliance efforts are ongoing and documented if they want to avoid costly penalties.

Break for ACOs

But thankfully, since ACOs are still relatively new, CMS is giving them more time to improve if they don’t meet their money saving goals, writes Kaiser Health News.

For the most part, ACOs have done a good job of meeting these goals. In the first year of the program, 1,118 ACOs saved CMS about $705 million. Only about 100 ACOs went over their spending allotment, and they still have time to improve their performance and earn incentives because of a three-year grace period. However, some ACO leaders fear this won’t be enough time to improve their results.

To alleviate those fears, CMS recently proposed a new rule that would give ACOs an extra three years before penalizing organizations for poor performance, giving them six years at most to avoid penalties.

But there’s a catch. ACOs that choose to use the time to delay penalties can only keep 40% of their savings, as opposed to the 50% they can keep during the first three years.

If your facility is involved in an ACO, you’ll want to collaborate with your partners to determine whether to take the extra three years or if you’ll focus your efforts on improving performance now in order to retain more revenue.

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