OIG Urges CMS to Tweak Encounter Data System to Avoid Fraud

In its latest review of the Encounter Data System (EDS) that is used largely to determine Medicare Advantage plan payments, the HHS Office of Inspector General (OIG) urged CMS for the second time to incorporate National Provider Identifiers (NPIs) into its collection of data from MA organizations. Despite their potential to improve program integrity in certain fraud-prone areas, NPIs for ordering providers are still not required in encounter data submissions and continue to be “largely missing” from records submitted by MAOs, observed the new OIG report.

CMS in 2012 began collecting encounter data from MAOs and, with the goal of eventually replacing the legacy Risk Adjustment Payment System, in 2016 began using it to determine risk-adjusted payments to MAOs. But the agency has always maintained that it could be used for program integrity and research purposes and in 2018 began making MA encounter data available to researchers. Last year, the Medicare Payment Advisory Commission suggested that encounter data also be used to determine star quality ratings at a local level (RMA 3/21/19, p. 3).

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