Bass, Berry & Sims attorney Lindsey Fetzer commented on the Medicare Risk Adjustment Data Validation (RADV) final rule issued Monday, January 30 by the Centers for Medicare and Medicaid Services (CMS) and explained what financial impact the final rule will have on Medicare Advantage (MA) plans. The final rule, which was first published in 2018 and had continuously faced strong opposition within the healthcare industry, will extrapolate diagnostic coding error rates dating from 2018, forcing MA plans to pay for the overbilling from the last five years.
CMS staked out a middle ground by not extending the extrapolation provisions further back than 2018, but eliminating the fee-for-service adjuster is likely to trigger lawsuits, said Lindsey. She added, “In terms of immediate analysis of what financial impact looks like, it’s better than some were hoping for, but I would still say the prospective impact of allowing for extrapolation will fundamentally change how plans may operate.”
The full article, “CMS Finalizes RADV Rule, Leaves MA Plans on the Hook for Billions,” was published by Modern Healthcare on January 30 and is available online (subscription required).