Lexology February 2, 2023
On February 1, the Centers for Medicare & Medicaid Services (CMS) published a final rule strengthening their authority to recover alleged overpayments made to Medicare Advantage plans. The rule formalizes the Medicare Advantage Risk Adjustment Data Validation (RADV), which CMS uses to risk-adjust payments made by CMS to a Medicare Advantage Organization (MAO). While legal challenges to the rule are likely, if the final rule is ultimately upheld as written, CMS estimates that it will result in a recoup of $4.7 billion in purported overpayments to MAOs over the next decade.
When CMS contracts with MAOs to offer Medicare Advantage plans, it must — per Section 1853(a)(1)(C) of the Social Security Act — make payments that are “risk-adjusted” based upon...
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