Medicare Advantage Encounter Data Show Promise for Program Oversight, But Improvements Are Needed

WHY WE DID THIS STUDY

For the Medicare Advantage (MA) program, CMS contracts with private insurance companies, known as MA organizations (MAOs), to provide Medicare coverage for 18.6 million beneficiaries. In fiscal year 2016, MA expenses reached $200 billion. In 2012, CMS began collecting detailed information from MAOs regarding each service provided to MA beneficiaries. This information is known as MA encounter data. These data must be accurate for CMS to review the medical care that beneficiaries are receiving and use the data to increase payments to MAOs for beneficiaries in poorer health. Ensuring the completeness, validity, and timeliness of the MA encounter data is also critical to safeguard program integrity and to ensure that MA beneficiaries receive needed medical care.

HOW WE DID THIS STUDY

We analyzed 102 million MA encounter records from the first quarter of 2014 to determine the extent to which data contained in CMS's Integrated Data Repository were complete, valid, and timely. In addition, to review the actions that CMS has taken to address errors in MA encounter data, we analyzed CMS's responses to a structured questionnaire and relevant policy and procedural documentation.

WHAT WE FOUND

Overall, 28 percent of MA encounter records that we reviewed from the first quarter of 2014 had at least 1 potential error, but CMS reported correcting the majority of these records. According to CMS, most of these potential errors were created when CMS removed provider identifiers from records in its edit process. With CMS's subsequent correction, only 5 percent of the records in our review would contain a potential error. Types of potential errors included inactive or invalid billing provider identifiers; duplicated service lines; missing required data; inconsistent dates; and beneficiary information that did not match CMS's records. Just 1 percent of MAOs submitted 51 percent of the records with potential error(s). Some of these errors may raise concerns about the legitimacy of services documented in the data, such as records that lacked a beneficiary last name or a valid identifier for the billing provider.

Although MAOs must submit identifiers for billing providers, CMS does not require MAOs to submit identifiers for ordering or referring providers and requires identifiers for rendering providers only under certain circumstances. Identifiers for ordering and referring providers-and in some cases, for rendering providers-were frequently absent from encounter data, which limits the use of these data for vital program oversight and enforcement activities. CMS's key control to ensure data integrity has been its edit process, which rejects data that do not pass certain checks. However, CMS has not tracked whether MAOs respond when this process rejects data. CMS has plans to implement additional compliance activities to ensure data integrity, but it has not established performance measures that monitor MAOs' submission of records with complete and valid data.

WHAT WE RECOMMEND

We recommend that CMS take actions as appropriate to address potential errors in the MA encounter data; provide targeted oversight of MAOs that submitted a higher percentage of records with potential errors; ensure that billing provider identifiers are active and valid on all records; require MAOs to submit ordering and referring provider identifiers and ensure the submission of rendering provider identifiers for applicable records; track how MAOs respond to edits that reject data; and establish and monitor performance thresholds related to MAOs' submission of records with complete and valid data. CMS concurred with four of our seven recommendations.