HHS’ Top Ten Management Problems Include Labs

The OIG's FY 2015 Top Management and Performance Challenges target clinical laboratories among other providers as a necessary focus of efforts to fight fraud, abuse and waste in Medicare. Specifically, the report notes that while "[f]raud schemes shift over time, … certain Medicare services have been consistent targets"—namely, clinical laboratories. The OIG report notes "CMS is not realizing the full potential of contractors to proactively identify fraud and address other program integrity concerns."

The OIG does commend the Health Care Fraud and Abuse Control Program for its ability to return $7.70 for every $1 invested in fighting fraud and abuse, the Fraud Prevention System, which achieved $133 million in adjusted actual and projected savings and a $2.84 return on each $1 invested, as well as the establishment of the ICD- 10 Coordination Center and appointment of an ICD-10 ombudsman as successful efforts by HHS to address the above challenges.

However, the report asserted "more needs to be done" and the Centers for Medicare and Medicaid Services needs to identify and recover improper Medicare payments "in a timely manner" and implement safeguards to prevent recurrence.

"[M]eaningful and secure exchange and use of electronic information and health information technology" was another top concern. Specifically, the OIG advised "[t]o make use of the benefits of the growing amounts of data in the health care context, data must be available, subject to appropriate privacy and security safeguards, where and when needed." The report indicates this lack of information sharing can have patient safety implications; for example, if a patient undergoes additional invasive testing because prior results from a different provider aren't shared.

Not surprisingly reforming payment programs was also included among the top ten challenges facing HHS—including implementation of the "new market- driven payment system for laboratory services beginning in 2017." The report warned that CMS "must establish policy, infrastructure, data systems, and oversight mechanisms to successfully implement these substantial changes."

Among the steps the OIG says need to be taken are providing "clear guidance for providers on program requirements" and developing systems to ensure models are successfully implemented and problems or inefficiencies are identified and addressed. Data is also a concern.

Takeaway: Laboratory compliance continues to cited as a subject of concern for government agencies.