CMS Audits Highlight MAO Performance Problems Related to Denials

By R. Kendall Smith, Jr., MD, SFHM

report released by the HHS Office of Inspector General (OIG) in September 2018 found that Medicare Advantage Organizations (MAOs) overturned a jaw-dropping 75 percent of their own denials from 2014 to 2016. Even more startling was that independent reviewers at higher levels within the appeals system reversed originally denied claims, finding in favor of beneficiaries and providers.

Furthermore, 45 percent of contracts were cited by CMS for sending denial letters with incomplete or misleading information, which may have hindered providers’ or beneficiaries’ chances of prevailing with an appeal. What appears of immense concern in this report was the comment that CMS continues “to see the same types of actions in its audits of different MAOs every year.” More telling was that 76 MAO contracts overturned more than 90 percent of their own denials upon appeal, including seven contracts that overturned more than 98 percent.”

Given these astounding overturn numbers, one has to wonder why beneficiaries and providers appealed only 1 percent of denials to the first level of appeal—reconsideration by a Quality Improvement Organization or their MAO. The remaining 99 percent of denials go unchallenged despite an almost four out of five chance of prevailing on appeal.

In the words of Bob Marley: “Get Up, Stand Up, don’t give up the fight.” Stop letting money flow down the drain.

Learn how your organization can save time and resources amidst increasing volumes of Medicare, Medicaid, and commercial payer denials.