Latest data indicate that approximately 8.5% of Part B payments were improper.
It’s quite possible if you are reading this article and have been in practice for several years that you have received a letter from Centers for Medicare & Medicaid Services (CMS) entitled, “CERT documentation request.” You may have wondered why you were selected to receive this letter, what happens with the information, what happens if you don’t respond, and what purpose the program serves.
In this article, I will break down the basics of the CERT program and what it means for your practice.
The Comprehensive Error Rate Testing (CERT) program was implemented to measure improper payments in the Medicare fee-for-service program. CERT is part of an annual effort based in statute (most recently, the Payment Integrity Information Act of 2019) to identify and reduce improper payments and hold government agencies accountable. Those agencies, in turn, are required to report to Congress and the public. Improper payments can be overpayments or underpayments and can include payments for services not received, payments for an incorrect amount, or other issues deriving from noncompliance with rules and regulations.1
How exactly does CMS determine that a particular Medicare payment is “improper”? The answer is: through a sampling methodology. Each year, a statistically valid random sample of approximately 50,000 claims for Part A, Part B, and durable medical equipment services is selected for review. Then medical records are requested from both the billing provider and the ordering/referring provider (those letters you may have received). Once those records are received, a medical review professional (doctor, nurse, or certified coder) reviews the submitted documentation to determine whether the claim was paid or denied properly under Medicare coverage, coding, and billing rules. Any improper payments are assigned an error category (no documentation, insufficient documentation, medical necessity, incorrect coding, other). An improper payment rate based on this sample (improper payments/total payments) is then assigned and used to project the total improper payments in Medicare for the time period. Each improper payment is also reported to the Medicare administrative contractors, who are then responsible for recouping overpayments (another letter you may have received) or even repaying underpayments.2
How big a problem are improper payments in the Medicare fee-for-service program? In the fiscal year 2021 report, CMS projected that $25 billion (6.3%) of payments were improper; all but $400 million were overpayments.3 The 2021 improper payment rate of 6.3% is the lowest since 2009 (6.3%-12.7%). Improper payments in 2021 included $14.2 billion for Part A, $8.5 billion for part B, and $2.4 billion for durable medical equipment. Most of these improper payments were based upon insufficient documentation (64%) or medical necessity (13.6%). Claims errors are classified as medical necessity when the records allow the reviewer to determine that services billed were not medically necessary based upon Medicare coverage and payment policies. Incorrect coding only accounted for 10.6% of all improper payments in 2021 but a significant portion of Part B improper payments (see below).4
How do urologists compare with other provider types in terms of improper payments determined through this program? Urologists had an improper payment rate of 3.4% and accounted for $70 million (0.8% of Part B improper payments and 0.3% of all improper payments in 2021). The physician provider types with the highest improper Part B payment rates were psychiatry (16.3%), endocrinology (13.6%), infectious disease (13.5%), interventional cardiology (13.1%), and hospitalist (13.1%); those with the lowest rates were ophthalmology, pathology, allergy/immunology, medical oncology, and rheumatology (all under 2%). The overall average improper payment rate for Part B was 8.5%.4
What procedures were most commonly determined to be improperly paid in the Part B program? According to CMS data, the codes most frequently deemed improper among physician provider types were evaluation and management codes. Table 1 shows the rates at which reviewers disagreed by code for all provider types and for urologists. Level 4 and level 5 new and established patient office visits, level 3 hospital visits, and chronic care management codes topped the list of codes with improper payments. A total of 263 procedures performed by urologists were reviewed in 2021, and 25 (9.5%) were deemed improper. The majority of these were evaluation and management codes, and the most common denial category was incorrect coding (Table 2).
The bottom line and why it matters
There are laws that compel government agencies to identify and reduce improper payments to suppliers, and your Medicare claims may be reviewed as part of this initiative. The latest data (fiscal year 2021) published by CMS on the CERT program indicate that approximately 8.5% of Part B payments were improper, including about 3.4% of payments to urologists. Urologists should take note that high-level (4/5) evaluation and management codes and chronic care management codes were most likely to be deemed improper in this sampling and be sure that their claims are supported both by medical necessity and appropriate documentation. Urologists compare favorably with other specialties in this regard according to the latest data from CMS.
1. Comprehensive Error Rate Testing (CERT): background. Centers for Medicare & Medicaid Services. Updated December 1, 2021. Accessed July 8, 2022. https://go.cms.gov/3as4LAH
2. Comprehensive Error Rate Testing (CERT) program. Centers for Medicare & Medicaid Services. Accessed July 8, 2022. https://go.cms.gov/3Pixp6h
3. Medicare fee-for-service Comprehensive Error Rate Testing. Centers for Medicare & Medicaid Services. Updated January 13, 2022. Accessed July 8, 2022. https://bit.ly/3ySvIqs
4. US Department of Health and Human Services. 2021 Medicare fee-for-service supplemental improper payment data. Accessed July 8, 2022. https://go.cms.gov/3NSRYos