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GAO Report Examines CMS Efforts to Strengthen Screening

From July 2011 to February 2012 the Government Accountability Office (GAO) conducted a performance audit of the Centers for Medicare and Medicaid Services (CMS) efforts to strengthen the screening of providers and suppliers applying to take part in, and currently taking part in, the Medicare and Medicaid programs. On April 10, 2012 the GAO released its report to the Chairman of the Senate Finance Committee.

The purpose of the study was to determine weaknesses in the CMS enrollment procedures that leave the Medicare and Medicaid programs open to fraud and abuse. CMS currently has some procedures in place for screening applicants, and the GAO study reveals that there are planned procedures that will be proposed and implemented in 2012 to further improve the applicant screening process.

The Patient Protection and Affordable Care Act of 2010 (PPACA) provided CMS with increased authority to combat fraud and abuse in Medicare. Under this authority, CMS currently uses front end automated edits to check a provider’s National Provider Identifier to make sure it is active before processing a claim. PPACA also requires providers and suppliers be subject to licensure checks, and gives CMS the authority to require criminal background checks.

The GAO report addresses the extent to which CMS has implemented new provider and supplier enrollment screening procedures since the enactment of PPACA. On February 2, 2011 CMS published a final rule implementing a screening procedure based on a provider or supplier’s risk of fraud, waste, and abuse. These risk categories are limited, moderate, and high. Each risk category comes with varying degrees of application screening. High risk providers and suppliers could undergo unscheduled site visits and fingerprint based criminal background checks.

The report found that there are currently new screening procedures, the implementation of which remain in progress. CMS is in the process of drafting a proposed rule which will extend surety bond requirements for home health agencies, independent diagnostic testing facilities, and potentially outpatient rehabilitation facilities. Currently, surety bonds are only required for DMEPOS suppliers.

CMS is also planning to contract with Federal Bureau of Investigation-approved contractors to handle fingerprinting of providers and suppliers, and do criminal background checks of high risk applicants. CMS expects to have contracts in place for these screening procedures by the end of 2012.

PPACA has a requirement that Medicare providers establish compliance programs that contain core elements of compliance and ethics as established by CMS and the HHS OIG. A compliance program is a set of policies and procedures that a provider organization implements to help it act ethically and within the parameters of the law. CMS is working on developing a compliance program intended to help provider organizations prevent and detect violations of Medicare regulations, but there is no current target date for the implementation of this program.

If you have questions about CMS screening procedures, or need assistance implementing a compliance plan, please contact an experienced healthcare attorney at Wachler & Associates at 248-544-0888.

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