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Reps. Graves and Schiff Introduce Bipartisan Legislation to Improve Medicare Audit System


Location: Washington, DC

Congressmen Sam Graves (R-MO) and Adam Schiff (D-CA) today are re-introducing the Medicare Audit Improvement Act, legislation to improve the nation's Medicare audit system. The bill would amend the Medicare Modernization Act of 2003 to rectify problems identified since the creation of the Recovery Audit Contractor (RAC) program as a part of that law. Specifically, the Medicare Audit Improvement Act would reinstate and make statutory a hard cap on Additional Document Requests (ADRs) on the part of Medicare auditors to two percent of hospital claims with a maximum of 500 ADRs per 45 days. Smaller hospitals in particular have expressed deep concern over the administrative burdens being placed on them by Medicare audit contractors, including large increases in the number of documents being requested.

"While I believe we must continue to identify and correct verifiable fraud, hospitals have been buried in the administrative burdens put on them by Medicare audit contractors," said Congressman Graves (R-MO). "Doctors and nurses should be focused on caring for patients, not trying to comply with the ever-increasing requests for documents. My bill would put in place common-sense reforms allowing auditors to still conduct adequate oversight of billing problems without an open-ended invitation from CMS to continually bombard hospitals. Our smaller, rural hospitals are especially ill-equipped to deal with this increased administrative burden."

"I am proud to cosponsor the Medicare Audit Improvement Act of 2013 along with my colleague, Congressman Graves," said Congressman Schiff (D-CA). "This bill addresses critical operational problems in the Recovery Audit Contractor program, which directly contribute to the skyrocketing cost of healthcare. Ensuring the accuracy of audits allows us to continue to recoup improper Medicare payments fairly and efficiently, and strengthen the fiscal integrity of Medicare."

The Medicare Audit Improvement Act also seeks to improve auditor performance by assessing penalties for auditors that do not comply with basic program requirements such as deadline and issuance of "demand letters." The American Health Information Management Association (AHIMA) and the American Hospital Association (AHA) support the legislation, which was originally introduced last Congress in October 2012.

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