CMS’ poor oversight of EHR Incentive Programs leads to $700 million in overpayments

CMS made more than $700 million in EHR Incentive Program overpayments and will attempt to recover overpayments from eligible providers (EP), according to a June 7 report released by the Office of Inspector General (OIG).

The EHR Incentive Programs, established in 2011, encouraged EPs and hospitals to adopt EHRs by making payments to participating organizations that attested to meaningful use of the technology. Although CMS made more than $6 billion in incentive payments, the program has been plagued by criticism from EPs, hospitals, and federal watchdog agencies. In past reports, the OIG cited individual states for overpaying EPs and hospitals that did not properly attest to meaningful use.

OIG auditors discovered CMS conducted only minimal reviews of self-reported attestation data, leaving the program vulnerable to errors and deliberate fraud. The agency estimates that during the audit period, May 2011 to June 2014, CMS made $729,424,395 in inappropriate incentive payments. In some cases, CMS made payments to EPs for the wrong payment year because the agency didn’t have edits in place to ensure that EPs who switched from one program to the other were placed in the correct payment year, resulting in overpayments of $2,344,680.

The OIG also audited a sample of 100 EPs and found that CMS paid $291,222 to EPs that did not meet meaningful use requirements.

The OIG recommends that CMS take the following actions:

• Review EP incentive payments to determine which EPs didn’t meet meaningful use measures to attempt recovery of the $729,424,395
• Recover $2,344,680 in overpayments made to EPs after they switched programs
• Recover $291,222 in payments made to sampled EPs that did not meet meaningful use requirements
• Review a random sample of EPs’ supporting documentation to identify overpayments made after June 2014
• Create edits to ensure that payments are made for the correct payment year
• Educate EPs on documentation requirements

CMS concurred with the OIG’s recommendations and offered information on actions it has taken to recoup overpayments.

The beleaguered program ended with the 2016 reporting period. Participating EPs and hospitals will see payment adjustments based on 2016 data in 2018. EPs must report similar EHR meaningful use data through the Quality Payment Program.