Blue Care Network of Michigan (BCN) is under the spotlight following a recent audit by the Office of Inspector General (OIG). The audit, focusing on Medicare Advantage (MA) program payments, revealed significant concerns regarding the accuracy of diagnosis codes submitted by BCN, leading to substantial overpayments. This report delves into the findings and recommendations of the OIG audit, shedding light on the implications for Blue Care Network and the broader landscape of Medicare Advantage program compliance.
Understanding the OIG Audit and Medicare Advantage Risk Adjustment
The Centers for Medicare & Medicaid Services (CMS) utilizes a risk adjustment program within Medicare Advantage to ensure fair payments to MA organizations. This system adjusts payments based on the health status of enrolled individuals. MA organizations, like Blue Care Network, are responsible for collecting diagnosis codes from healthcare providers and submitting them to CMS. These codes are crucial as they reflect the health conditions of enrollees and directly impact the payments MA organizations receive. Certain diagnosis codes are identified as high-risk, meaning they are more susceptible to miscoding, potentially leading to inflated payments from CMS. The OIG’s audit of Blue Care Network is part of a broader initiative to scrutinize these high-risk diagnosis codes and ensure the integrity of the risk adjustment program.
Key Findings: Overpayments and Documentation Deficiencies at Blue Care Network
The OIG audit of Blue Care Network uncovered significant discrepancies in the submitted high-risk diagnosis codes. Out of a sample of 210 enrollee-years, a staggering 192 cases lacked adequate medical record support for the diagnosis codes submitted. In some instances, the medical records provided did not validate the diagnosis codes, while in others, Blue Care Network was unable to even locate the necessary medical records. This widespread lack of documentation resulted in an estimated $542,164 in overpayments within the audited sample.
Extrapolating these findings across the entire period of 2017 and 2018, the OIG estimated that Blue Care Network received at least $6.4 million in overpayments due to unsupported high-risk diagnosis codes. While federal regulations limited the OIG’s recommended financial recovery to $3.4 million (due to extrapolation limitations prior to 2018), the findings underscore serious concerns about Blue Care Network’s compliance with CMS program requirements. The audit strongly suggests that Blue Care Network’s existing policies and procedures for preventing, detecting, and correcting noncompliance need substantial improvement to adhere to federal mandates.
OIG Recommendations and Blue Care Network’s Response
In response to these findings, the OIG issued three key recommendations to Blue Care Network:
- Refund Overpayments: The OIG recommended that Blue Care Network refund $3.4 million to the federal government, representing the estimated overpayments within the recoverable period.
- Investigate and Rectify Broader Noncompliance: The OIG urged Blue Care Network to proactively identify similar instances of noncompliance, both before and after the audit period, for the high-risk diagnoses in question. This includes refunding any additional overpayments identified through this internal review.
- Enhance Compliance Procedures: The OIG emphasized the need for Blue Care Network to thoroughly examine and improve its compliance procedures. This is to ensure that all submitted high-risk diagnosis codes meet federal requirements when used in CMS’s risk adjustment program. The goal is to prevent future instances of miscoding and overpayments.
Despite the clear findings and recommendations, Blue Care Network reportedly disagreed with both the audit’s conclusions and the proposed recommendations. This disagreement sets the stage for potential further discussions and actions between OIG, CMS, and Blue Care Network to resolve the identified compliance issues and financial discrepancies.
Implications for Blue Care Network and Medicare Advantage Compliance
The OIG audit of Blue Care Network serves as a critical reminder of the importance of accurate diagnosis coding and robust compliance programs within the Medicare Advantage framework. For Blue Care Network, addressing the identified shortcomings in their documentation and compliance procedures is crucial to avoid future financial penalties and maintain their standing within the Medicare Advantage program. More broadly, this audit highlights the ongoing scrutiny of MA organizations and the necessity for all participants to prioritize data integrity and adhere strictly to CMS guidelines to ensure the financial stability and fairness of the Medicare Advantage program.
