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Audit (A-07-08-01052)

Review of Duplicate Capitation Payments to Medicare Advantage Organizations and Programs of All-Inclusive Care for the Elderly Organizations

Executive Summary

We found that of the approximately 218 million capitation payments totaling approximately $158 billion that CMS made for Medicare enrollees from January 2006 through March 2008, only 373 payments totaling $301,000 were duplicate payments for 1 month of health care coverage. CMS may make only one capitation payment per month for each Medicare individual enrolled in a Medicare Advantage plan or a Programs of All-Inclusive Care for the Elderly plan. Although CMS had correctly paid organizations for the vast majority of enrollees, the validation process that CMS used to ensure the accuracy of payments did not identify and prevent these improper payments.

We recommended that CMS (1) recoup the $301,000 in improper payments; (2) determine whether enhancements to its validation process would be cost effective and, if so, implement the enhancements; and (3) periodically review, on a postpayment basis, payments made to organizations to detect and recover any duplicate payments. In comments on our draft report, CMS concurred with our recommendations and described the corrective actions that it was taking or planned to take.

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