CMS’s Stop Payment Policies for Dead People 'Generally Effective'

Auditors found that CMS made 1.8 million adjustments to Medicare capitation payments over a three-year period and recouped nearly $3 billion that had been paid on behalf of dead people.

The Centers for Medicare & Medicaid Services was “generally effective” in ensuring that capitation payments to Medicare Advantage contractors were not made for dead beneficiaries, a federal audit found.

The Department of Health and Human Services’ Office of the Inspector General examined CMS’ payments from 2012 through 2015. The auditors found that CMS made 1.8 million adjustments to capitation payments, and recouped $2.96 billion from MA organizations for Parts A and B capitation payments that had been made on behalf of dead beneficiaries.

The federal government paid more than $616 billion Medicare Advantage payments for the three-year span examine by OIG.

CMS did not identify and recoup all improper capitation payments, however.

"As of March 7, 2017, CMS had not recouped $2.4 million associated with 1,817 capitation payments that were made on behalf of 978 beneficiaries. For our audit period, these improper payments represented .0004% of the total capitation payments made to MA organizations and .08& of the total adjustments that CMS made after receiving information on beneficiaries' dates of death," OIG said.

"We recommended that CMS recoup the $2.4 million in capitation payments made to MA organizations for Medicare Parts A and B services on behalf of deceased beneficiaries, and that CMS implement system enhancements to identify, adjust, and recoup improper capitation payments in the future," OIG said.

CMS concurred with the recommendations and said corrective actions had been implemented.