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FY 2007 HHS Annual Plan
Strategic Goal 8
Achieve Excellence in Management Practices
On this page:
Program 8a: Medicare Integrity Program Centers for Medicare & Medicaid services (CMS)
Highlighted Programs:
- 8a. Medicare Integrity Program (CMS)
HHS is committed to improving the efficiency and effectiveness of the Department's programs by creating an organization that has a citizen-based focus, is results oriented, and is market-driven, where practicable. Approximately three HHS programs in three OPDIVs contribute to achieving this strategic goal. The Medicare Integrity Program initiative is highlighted in this section. Program integrity efforts ensure the Medicare program pays the right amount to legitimate providers for covered, reasonable, and necessary services that are provided to eligible beneficiaries.
The President's Management Agenda identifies key elements needed for HHS to achieve its commitment to effective management. In particular, HHS is dedicated to improving management of our financial resources; using competition to obtain the best price for services acquired; improving the management of our human capital and tying human capital goals to program performance goals; using technology wisely and in a cost effective manner; and achieving budget and performance integration.
As displayed on page six in the Overview, HHS is committed to achieving excellence in management practices through implementing the President's Management Agenda. In FY 2007, HHS will continue to recruit appropriately skilled employees through the Emerging Leaders program. HHS will also use the PART assessment to inform budget decisions, program improvements, legislative proposals, and management actions.
Performance Measure: Reduce the Percentage of Improper Payments Made Under the Medicare Fee-for-Service Program
The Medicare Integrity Program (MIP) plays a crucial role in meeting the requirements of improving financial performance under HHS Strategic Plan Goal 8 to achieve success in management practices. CMS started measuring the percentage of improper payments made under the Medicare program in 1996 and created a goal to reduce this percentage. CMS now has five goals representing the MIP. These include reducing the contractor error rate and improving the provider compliance error rate.
The Comprehensive Error Rate Testing (CERT) program was initiated in FY 2003 and has produced a national error rate for each year since its inception. The OIG calculated the error rate for years before those included in the FY 2003 report. In 2004, CMS began reporting gross error rates in addition to the net error rates previously reported. This change was necessary in order to comply with new Improper Payments Information Act (IPIA) requirements. For the purposes of this display and the sake of consistency, we have included the gross improper payment measures for FY 2002 and FY 2003 (shown in parentheses) along with the error rates which have been more publicized. The targets for those two years were calculated for net error rates (overpayments minus underpayments as oppose to overpayments plus underpayments).
One of CMS' major goals is to pay claims properly the first time. Paying right the first time saves resources and ensures the proper expenditure of limited Medicare trust fund dollars. Beginning with the 2002 PART process, CMS worked with OMB to set ambitious annual targets for its program integrity goals for FY 2004 and beyond. The goal then was to bring the error rate down to 4.8 percent by FY 2008. In fact, in FY 2005, CMS achieved a 5.2 percent improper payment rate exceeding its target of 7.9 percent and has therefore adjusted future targets to make them more aggressive. The FY 2004 Medicare Integrity Program PART assessment completed in 2002 found that the program has a clear purpose, is managed well overall and relies on performance measures that are directly relevant to the program purpose.
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Performance Measure Table
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Performance Measure: Reduce the Percentage of Improper Payments Made Under the Medicare Fee-for-Service Program
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Year
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Target
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Result
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2007
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4.9%
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11/2007
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2006
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5.1%
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11/2006
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2005
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7.9%
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5.2%
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2004
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4.8%
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10.1% (recalculated baseline)
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2003
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5.0%
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5.8%* (10.8%)
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2002
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5.0%
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6.3% (8%)
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Data Soarce: CMS assumed responsibility for measuring the Medicare fee-for-service error rate beginning in FY 2003 with oversight by the OIG. Error rate and improper payment rate information for years prior to the FY 2003 report was compiled by the OIG.
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Data Validation: The CERT program is monitored for compliance by CMS through monthly reports from the contractors. In addition, the OIG periodically conducts reviews of CERT and its contractors.
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Performance Budget Reference: CMS FY 2007 CJ, Pg 257.
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*
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This figure was adjusted due to a higher than expected non-response rate. The actual statistically significant rate was 9.8 percent.
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MIP's ability to leverage private sector entities through its contracting authority has proven to be effective. The CERT program has provided CMS with a powerful tool to identify problems in the claims process and address these problems through specific corrective action plans. Additionally, new Medicare contractor reform legislation, enacted through the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA), will further enhance MIP's effectiveness.
2007 Annual Plan Home
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