More Than One Medicare Audit? Better Check for Overlap.

A phenomenon in Medicare audits that is gaining increased visibility is Medicare contractors “double-dipping” from providers by using overlapping audits. Once viewed as isolated aberrations, it is becoming increasingly common for Medicare contractors to audit and deny the same claims twice in different audits. This practice generally leads to overpayment demands for the same claims, meaning contractors are demanding that providers and suppliers repay the same claims twice. Though profoundly unfair and very likely unlawful, providers may face difficulty challenging such an overlap in the complex and lengthy Medicare appeals process.

The Centers for Medicare & Medicaid Services (CMS) authorizes several types of contractors to conduct audits, such as Medicare Administrative Contractors (MACs), Recovery Audit Contractors (RACs), Unified Program Integrity Contractors (UPICs), and the Supplemental Medical Review Contractor (SRMC). Some contractors are paid a percentage of the amounts they collect from the providers they audit, incentivizing them to over-deny claims and over-collect payments. In some instances, one contractor may not communicate with another, leading both to target the same claims. Alternatively, a contractor may fail to communicate internally or document its own audits properly, leading the same contractor to deny and attempt to collect on the same claims multiple times. As the number of Medicare audits has exploded over the last several years, such missteps have become increasingly common.

Any Medicare provider or supplier who has received more than one Medicare audit or overpayment demand should verify whether any of the claims overlap. Overlaps are found most often in statistically extrapolated audits, although they can occur in any type of audit. Where an overlap is found, a provider may raise the issue in the five levels of the Medicare claims appeal process: Redetermination by the MAC, Reconsideration by a Qualified Independent Contractor (QIC), review by an Administrative Law Judge (ALJ) employed by Department of Health and Human Services (HHS), review by the Medicare Appeals Council, also within HHS, and review by a judge in a federal court.

However, as with any issue raised in the Medicare claims appeal process, there are a number of procedural and substantive arguments that the contractors and HHS’s reviewers themselves will use to hinder or defeat the provider’s appeal. Contractors often have little incentive to perform a thorough review and generally “rubberstamp” each other’s work. On the other hand, HHS’s reviewers, especially the ALJs, are constrained by regulations that limit their discretion and scope of review. Therefore, a good case or egregious conduct by a contractor alone may not be enough to prevail on an appeal. Very often it is the timing, manner, and argument, with which an appeal or evidence is presented that affects whether it will receive a thorough and just review.

For over 35 years, Wachler & Associates has represented healthcare providers and suppliers nationwide in a variety of health law matters. If you or your healthcare entity has been audited by a Medicare contractor or has any questions regarding healthcare compliance, please contact an experienced healthcare attorney at 248-544-0888 or wapc@wachler.com.