Inspector General blasts agency for ignoring ZPIC scrutiny

Overpaid home health claims that could have been avoided with “face-to-face” consultations, OIG says
Overpaid home health claims that could have been avoided with “face-to-face” consultations, OIG says

Ignoring a four-year-old warning to more thoroughly evaluate Medicare auditing contractors is among the pile of unheeded advice that could have saved the Medicare program billions of dollars in recent years, the Health and Human Services' Office of Inspector General charged Tuesday.

The OIG claimed that the Centers for Medicare & Medicaid Services had yet to implement its November 2011 recommendation to use workload statistics of Zone Program Integrity Contractors (ZPICs) when conducting program evaluations. OIG investigators say such efforts would have made the ZPIC program more accurate and efficient. The revelation was among several unimplemented recommendations concerning program integrity issues, including Medicare and Medicaid contractor oversight, according to published reports.

ZPICs, which have stepped up anti-fraud audits on nursing homes in recent years, have been facing increasing scrutiny by lawmakers.

Other unheeded recommendations had specific costly consequences, the OIG added. Included is $2 billion in overpaid home health claims that could have been avoided with “face-to-face” consultations, and nearly $4 billion in savings from better states' guidance on federal upper payment limits for Medicaid payments.

CMS established the ZPIC program in 2003 under Medicare fee-for-service contracting reform efforts. ZPIC is composed of seven “program integrity zones” through which contractors would analyze claims data for Medicare parts A, B, durable medical equipment prosthetics, orthotics, and supplies, home health and hospice.

A year after the OIG's recommendation on ZPIC workload statistics, the Congressional investigator raised more concerns and warned CMS to be more aggressive in examining potential conflicts of interest problems among ZPIC contractors. As McKnight's earlier reported, critics claimed that some contractors were abusing their authority by engaging in “stealth policymaking.”