CMS Unveils New Strategy with Medicare Advantage Audits, Affects US Stocks
The introduction of this new audit strategy by CMS is part of a larger effort to ensure the integrity and efficiency of the Medicare Advantage program, aiming to reduce overpayments and optimize resource allocation within the healthcare system.
The US stock market is experiencing mixed results, with notable declines in Humana and UnitedHealth shares due to a Medicare crackdown, while Hinge Health debuted strongly on the NYSE at $39.25 per share, exceeding expectations.
The Centers for Medicare and Medicaid Services (CMS) has introduced a new strategy aimed at intensifying and accelerating Medicare Advantage audits. This move is designed to address the existing backlog of audits for payment years 2018-2024, with the ambitious goal of completing them by early 2026. The initiative includes plans to audit all eligible Medicare Advantage contracts for each payment year, bolstered by the hiring of additional staff and the upgrade of technology to expedite the audit process.
The effort by CMS to enhance the efficiency and scope of Medicare Advantage audits is anticipated to facilitate the recovery of billions of dollars in overpayments. Estimates suggest that these overpayments could amount to approximately $17 billion annually, with some projections as high as $43 billion. To achieve this, CMS intends to significantly expand its workforce of medical coders from 40 to 2,000 and leverage advanced technology to review medical records and identify unsupported diagnoses.
The implications of this new strategy by CMS are far-reaching, affecting not only the stocks of major health insurance providers like Humana and UnitedHealth but also signaling a broader shift in how Medicare Advantage audits are conducted. As the healthcare landscape continues to evolve, the impact of these changes will be closely watched by investors, healthcare providers, and patients alike.