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Audit (A-03-09-00003)

Bravo Health Pennsylvania, Inc. (Contract H3949), Submitted Many Diagnoses to the Centers for Medicare & Medicaid Services That Did Not Comply With Federal Requirements for Calendar Year 2007

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The diagnoses that Bravo Health Pennsylvania, Inc. (Bravo), submitted to CMS for use in CMS's risk score calculations did not always comply with Federal requirements. CMS uses the risk scores to adjust the monthly capitated payments to Medicare Advantage organizations. The risk scores calculated using the diagnoses that Bravo submitted for 35 of the 100 beneficiaries in our sample were valid. The risk scores for the remaining 65 beneficiaries were invalid because the diagnoses were not supported for 1 or more of the following reasons: the documentation did not support the associated diagnosis, the documentation did not include the provider's signature or credentials, or Bravo did not provide any documentation to support the associated diagnosis.

Bravo did not review the diagnosis codes received from providers before submitting the codes to CMS and therefore could not ensure that the diagnoses submitted to CMS complied with Federal requirements.

As a result of these unsupported diagnoses, Bravo received $422,000 in overpayments from CMS. On the basis of our sample results, we estimated that Bravo was overpaid approximately $22.1 million in calendar year 2007.

We recommended the following: (1) Bravo should refund to the Federal Government $422,000 in overpayments identified for the sampled beneficiaries. (2) Bravo should work with CMS to determine the correct contract-level adjustment for the projected $22.1 million of overpayments. (This amount represents our point estimate. The confidence interval for this estimate has a lower limit of $17.4 million and an upper limit of $26.9 million.) (3) Bravo should modify its policies and procedures and improve its practices to ensure compliance with Federal requirements. Bravo generally disagreed with our findings and recommendations.

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