Letter To Kathleen Sebelius, Secretary, U.S. Department Of Health And Human Services

Letter

Grassley Works to Identify Medicare Fraud, Waste and Abuse

Senator Chuck Grassley is asking top officials why the federal government is failing to deliver an annual assessment of the level of improper Medicare payments for the second year in a row.

In a letter sent today to the Secretary of Health and Human Services and the Acting Administrator for the Centers for Medicare and Medicaid Services, Grassley asked for an accounting of what the agency has done to address the controversies in the methodology used by the contractor, which reportedly kept last year's report from being made.

"Medicare is a massive entitlement program that spends hundreds of billions of tax dollars every year, yet this is the second year without an authoritative audit that provides a breakdown of payment error rates by provider type," Grassley said. "Without this kind of assessment, administrators and policymakers aren't galvanized, as they ought to be, to do everything possible to better safeguard program dollars for beneficiaries and taxpayers. This is especially problematic in light of the impending insolvency of Medicare. Whatever the reason for the agency's inability to provide the data, the result is ineffective management of scarce Medicare dollars."

Grassley previously questioned the Centers for Medicare and Medicaid Services regarding allegations that it hadn't incorporated necessary data when calculating the improper payment rate for durable medical equipment. This impacted the work of the contractor carrying out the Comprehensive Error Rate Testing program, or CERT, designed to identify improper Medicare payments.

The text of Grassley's letter today, his inquiry from May 2008, and additional background information is below.

December 17, 2009

Kathleen Sebelius
Secretary
U.S. Department of Health and Human Services
200 Independence Avenue, SW
Washington, DC 20201

Charlene Frizzera
Acting Administrator
Centers for Medicare and Medicaid Services
U.S. Department of Health and Human Services
200 Independence Avenue, SW
Washington, DC 20201

Dear Secretary Sebelius and Acting Administrator Frizzera:

The United States Senate Committee on Finance (Committee) has jurisdiction over, among other things, the Medicare and Medicaid programs. As Ranking Member of the Committee, I have a responsibility to make sure that Medicare and Medicaid dollars are protected from fraud, waste, and abuse. Central to this task is monitoring the Comprehensive Error Rate Testing (CERT) program overseen by the Centers for Medicare and Medicaid Services (CMS).

CMS established the CERT program in 2003 to monitor the accuracy of Medicare fee-for-service (FFS) payments and report improper payment rates to Congress for each fiscal year, after responsibility for calculating the error rates was moved from the Department of Health and Human Services Office of Inspector General (OIG) to CMS. In past years, CMS released its Medicare FFS improper payment findings in an annual report submitted to Congress in mid-November, consistent with timeframes set forth in the Office of Management and Budget Circular No. A-11, Part 6 for the submission of annual financial and performance reports to Congress. The deadline this year was November 16, 2009. Although CMS has traditionally released its CERT findings in mid-November, it is now mid-December and the FY 2009 report has yet to be released. I write today to request an explanation for the delay and ask that you provide me with the anticipated release date for the FY 2009 CERT report.

In addition, I would like to note that Congress has yet to receive the FY 2008 CERT report. It is my understanding that last year's report was not issued due to controversy over the methodology used to calculate the improper payment rates. For your convenience I have enclosed the letter I sent to CMS in May 2008 regarding allegations that CMS did not conduct appropriate medical records reviews when it calculated the FY 2006 error rate for claims submitted for durable medical equipment (DME). I also requested the OIG to reexamine the FY 2006 and FY 2007 DME error rates developed by CMS. After conducting its review of the FY 2006 calculations, OIG stated that it had no reason to believe that the results of its review of the 2007 rates would be different from the results of its review of the 2006 rates. Thus, it was agreed that OIG would conduct an audit of the FY 2008 DME numbers, and the findings of that audit were released in May 2009. The OIG reports are enclosed with this letter.

Thank you for your immediate attention to this important matter.

Sincerely,

Charles E. Grassley
Ranking Member

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