CMS Clarifies Key Audit Terminology

Immediate Corrective Action Required (ICAR), Corrective Action Required (CAR), and Observation. These terms have become part of the vocabulary for Compliance specialists, auditors, analysts, managers, directors, and Compliance Officers who so often field questions from Operations. Let’s consider the following scenario: Compliance has just completed an internal audit of Claims Operations and has identified findings. This leads the Ops team to ask, “Are these findings CARs or ICARs?”

Last week, the Centers for Medicare & Medicaid Services (CMS) issued a memo clarifying certain definitions which apply to their Program Audit process. This clarification was released in response to Sponsors who have provided feedback stating they feel the process for determining CARs, ICARs and Observations is not transparent, and they lack the ability to determine how audit conditions will ultimately be classified. CMS has posted clarified definitions for these terms, as well as the term Invalid Data Submission (IDS) here on their CMS Program Audit website. While I will not re-write the memo, CMS hopes these key term definitions provide the industry with the transparency it sought. In short:

  • ICAR: These are items CMS identifies during an audit as systemic deficiencies so severe they require immediate correction. CMS cites lack of access to medication and/or services as well as immediate threats to enrollee health and safety. ICARs count as two points in the scoring methodology.
  • CAR: These are items CMS identifies during an audit as systemic and requiring correction, but the correction can wait until the audit report is issued. (This does not mean wait until the audit report is issued!) CMS clarifies that CARs may affect beneficiaries but not in a way immediately impacting their health and safety, and count as one point in the scoring.
  • Observation: These are non-systemic, typically one-off issues of non-compliance identified during the audit. No points are assigned in the scoring methodology for Observations.
  • IDS: This is cited when a Sponsor fails to produce an accurate universe within three attempts. This will be cited in 2016 for each element which cannot be tested, and counts as one point in the scoring.

CMS directs plans to send any questions to their mailbox at part_c_part_d_audit@cms.hhs.gov. Take it from me, the CMS team is responsive to posed questions. An informed and more prepared industry will hopefully make for a smooth 2016 audit season for CMS and for Sponsors.

 

Resources

In addition to monitoring your operations and auditing the organization’s performance, CMS also audits the compliance function.  In recent years many CMS sanctions have been issued as the result of a Compliance Program that was determined to be ineffective. Let us help you create a culture of compliance. Contact us today to get started >>

Registration for the GHG 2016 Forum is now open! This year we are offering a tiered pricing schedule. Register between now and February 14 to receive the $1095 price. Come February 15, the price increases to $1,295.Register today >>

Stay connected to industry news and gain perspective on how to navigate the latest issues through GHG’s weekly newsletter. Subscribe >>

Regan Pennypacker
Regan Pennypacker

Regan is Senior Vice President of Compliance Solutions at Gorman Health Group (GHG). She leads the Compliance Solutions practice, responsible for multidisciplinary projects such as Part C and Part D audits, new applications, marketing material reviews, risk assessments, and training engagements. As a member of this team, she has provided compliance direction and insight on industry best practices to many GHG clients. Regan brings GHG clients 19 years of experience in the healthcare industry. Read more

No Comments Yet

Leave a Reply

Your email address will not be published.