Audits of Compliance Programs

For Medicare Rx Plans Underway, CMS Says

The Centers for Medicare & Medicaid Services has begun auditing compliance programs of Part D plans to determine whether they meet the Medicare agency's standards for protecting the federal drug benefit program from fraud and abuse, a CMS official said Oct. 20.

CMS Program Integrity Group Director Kimberly Brandt said 100 drug plans already have been targeted for desk audits of their compliance programs and that additional plans would be selected in coming months for similar reviews.

The first round of compliance plan audits have focused mostly on large insurers, Brandt said at the Crowell & Moring LLP Healthcare Ounce of Prevention Seminar in Washington.

She noted that if plans are not notified by February or March next year about a compliance audit, they probably are “off the hook” for the 2008 plan year.

Brandt said generalized results from the audits as well as recent regulatory changes in the Part D program would be used to update Chapter 9 of the Medicare Prescription Drug Benefit Manual, which covers compliance requirements for insurers. CMS also will consult with the Department of Health and Human Services Office of Inspector General and the Department of Justice on changes to the compliance chapter in the manual, she said.

For the compliance program audits, CMS auditors are following a statement of work and auditing protocol, Brandt said. She added that she expected CMS to issue after the November presidential election a report with general findings from similar audits of hospital compliance programs. Some of the observations in that report could be useful references for Part D plans, she said.

Brandt said the Part D compliance audits were started more than a year later than scheduled because of a lack of funding for Medicare oversight projects. She added that similar Medicare Advantage compliance audits were being delayed because of limited funding resources.

Staff attorneys for the Senate Finance Committee told the conference that committee Chairman Max Baucus (D-Mont.) and ranking member Charles Grassley (R-Iowa) were committed to increasing funding for Medicare oversight efforts.