Annual Performance Plan and Report

Topics on this page: Goal 4. Objective A | Table of Related Performance Measures | Analysis of Results | Plans for the Future | Objective Progress Update Summary

For Home and Community-based Services including Nutrition and Caregiver services increase the number of clients served per million dollars of Title III OAA funding. (Lead Agency - ACL; Measure ID - 1.1)

Improve the average survey results from appellants reporting good customer service on a scale of 1 - 5 at the Administrative Law Judge Medicare Appeals level (Lead Agency - OMHA; Measure ID - 1.1.5)

Decrease under-enrollment in Head Start programs, thereby increasing the number of children served per dollar. (Lead Agency - ACF; Measure ID - 3F)

Decrease improper payments in the title IV-E foster care program by lowering the national error rate. (Lead Agency - ACF; Measure ID - 7S)

Reduce total amount of sub-grantee Community Services Block Grant (CSBG) administrative funds expended each year per total sub-grantee CSBG funds expended per year. (Lead Agency - ACF; Measure ID - 12B)

Reduce the Percentage of Improper Payments Made Under the Part C Medicare Advantage Program (Lead Agency - CMS; Measure ID - MIP5)

Reduce the Percentage of Improper Payments Made Under the Medicare Fee-for-Service Program (Lead Agency - CMS; Measure ID - MIP1)

Reduce the Percentage of Improper Payments Made Under the Part D Prescription Drug Program (Lead Agency - CMS; Measure ID - MIP6)

Increase the Percentage of Medicare Providers and Suppliers Identified as High Risk that Receive an Administrative Action (Lead Agency - CMS; Measure ID - MIP8)

Estimate the Payment Error Rate in the Medicaid Program (Lead Agency - CMS; Measure ID - MIP9.1)

Estimate the Payment Error Rate in the Children's Health Insurance Program (CHIP) (Lead Agency - CMS; Measure ID - MIP9.2)

Analysis of Results

ACL addresses performance efficiency at all levels of the National Aging Services Network in the provision of home and community-based services, including caregiver services. Access to and quality of these home and community-based services is foundational to the success of AoA's programs. In FY 2013, the Aging Services Network served 9,753 clients per million dollars of OAA funding exceeding the target of 8,700. Performance has largely trended upward and performance targets have been consistently achieved.

As part of its program assessment, OMHA is evaluating its customer service through an independent evaluation that captures the scope of the Level III appeal experience. This measure will assure appellants and related parties are satisfied with their Level III appeals experience based on beneficiary survey results. OMHA is specifically seeking to assess the appellants experiences that characterize the administrative law judge hearing process, including: being informed of the hearing process and applicable rules; being informed of the status of their case; feeling there was a full opportunity to be heard and present their position; believing the decision was fair, regardless of whether they agree with the outcome. In FY 2014, OMHA achieved a 3.9 level of appellant satisfaction nationwide, exceeding the 3.6 performance target level. This result indicates the vast majority of appellants were either somewhat or very satisfied with OMHA services, from initiation of cases through closure, as well as with the hearing formats used to adjudicate their cases.  However, appellant satisfaction scores have trended downward each year since FY 2011.  If processing times are allowed to increase due to the influx of appeal receipts, it is certain that appellant’s frustration with increasing processing times will grow and that their level of satisfaction with the process will decrease.

ACF continues to focus on improvements to reduce Head Start under-enrollment. Though each Head Start program is required to keep a wait list to fill vacancies as they occur, there are a number of reasons that it may be difficult to fill vacancies quickly. Low-income families are often mobile and eligible families on the waiting list may have moved out of the service area. In addition, as state pre-kindergarten programs have grown, parents may choose to send their children to those programs. The most recent data available indicate that, during the 2013-2014 program year, Head Start grantees had, on average, not enrolled 0.9 percent (0.88 percent) of the children they were funded to serve, missing the FY 2014 target of 0.6 percent. This represents approximately 8,200 children who could have been served using the Head Start funds appropriated and awarded to grantees.

ACF seeks to reduce erroneous payments in the title IV-E foster care program by estimating the national payment error rate and developing an improvement plan to strategically reduce, or eliminate where possible, improper payments. The national error rate is estimated using data collected in the most recent foster care eligibility review for each state. The FY 2014 Foster Care estimated national payment error rate is 5.5 percent. This represents an increase from the FY 2013 rate of 5.3 percent, although a drop by nearly one half from the FY 2004 baseline rate of 10.33 percent for the title IV-E foster care program. The increase in the error rate since FY 2013 is in part due to the fact that three states in the top third in terms of program size had error rate increases in the range of two to three percent this year. In particular, one state that ranks sixth in terms of program size tripled its (previously low) error rate, while two other states in the top ten in terms of program size reduced their error rates by less than one percent. Of the 15 states reviewed during the FY 2014 reporting period, nine had error rates below five percent; and six of those nine states had error rates below one percent. In contrast, three of the 15 states had error rates above 10 percent.

ACF strives to provide services to low income individuals and families through an efficient and cost effective delivery system through the Community Service Block Grant network. While states have an administrative cap of 5 percent, which limits the amount of funds that the state may retain for expenses, this ACF measure focuses on the administrative spending by sub-grantees. Historical trend data for this measure have fluctuated, with sub-grantees spending between 16 and 23 percent on administrative expenses. In FY 2013, 15.85 percent of CSBG sub-grantee funds were used for administrative costs, a slight decrease from the previous year's result of 16.07 percent, and exceeding the FY 2013 target of 16 percent.

HHS employs a number of measures to track the performance of efforts to fight fraud and reduce improper payments. One of CMS’s key goals is to pay claims properly the first time. The primary cause of improper payments is administrative and documentation errors, in large part due to insufficient documentation. CMS continues to develop new data analysis strategies and engage in provider and supplier education to prevent improper payments in Medicare Fee-for-Service. The Medicare Fee-for-Service improper payment estimate is calculated under the Comprehensive Error Rate Testing (CERT) Program. The FY 2014 result, an error rate of 12.7 percent, was above the targeted level of 9.9 percent.

Medicare Advantage (MA) plans (Medicare Part C) are managed care plans that provide Medicare-covered services for beneficiaries who select to participate in the program. All Part C plans are paid a monthly per capita premium, and errors can occur in the transfer and interpretation of source data and in payment calculations. CMS has implemented two key initiatives to improve payment accuracy in the Part C program: contract-level audits and new regulatory provisions that required that MA organizations must report and return overpayments that they identify and payment recover and appeal mechanism to be applied when CMS identifies erroneous payment data submitted by an MA organization. In FY 2014 results show that CMS has driven the error rate down to 9.0 percent, meeting the measure target.

The Medicare Part D Prescription Drug Program established an optional prescription drug benefit (Medicare Part D) for individuals who are entitled to or enrolled in Medicare benefits under Part A and Part B and for beneficiaries who qualify for both Medicare and Medicaid (full-benefit dual-eligibles). The program also provides for assistance with premiums and cost sharing to full benefit dual-eligibles and other qualified low-income beneficiaries. The payment error rate for the Medicare Part D Prescription Drug Program was 3.3 percent in FY 2014, exceeding our target of 3.6 percent. The root cause of all improper payments in the Part D program reported in FY 2014 is administrative and documentation errors. CMS continues to pursue enhancements to address this issue and has national training sessions for Part D plan sponsors covering comprehensive information for Part D payment and data submission requirements.

CMS’s Fraud Prevention System (FPS) uses sophisticated algorithms and computer modeling to identify providers whose behavior is aberrant and potentially fraudulent. This program seeks to increase the percentage of Medicare providers and suppliers identified as high risk that receive administrative action. CMS measures performance in this area by instances where a high risk provider had at least one administrative action (numerator) compared to the universe of high risk providers and suppliers (denominator). In FY 2014 the FPS exceeded its target, with 41.1 percent of high risk Medicare providers and suppliers receiving an administrative action. This approach reduces the burden on legitimate providers, while focusing the majority of the resources on those posing a high risk of fraud.

State Medicaid and CHIP programs, working with CMS, also have systems developed to identify, examine, track, and reduce the Medicaid and CHIP payment error rates. The Payment Error Rate Measurement (PERM) program measures improper payments in the fee-for service, managed care, and eligibility components of both Medicaid and CHIP. In FY 2013 CMS made enhancements to the rate calculation methodology to improve the accuracy of the Medicaid improper payment rate estimate. These improvements included replacing the three-year weighted average national Medicaid improper payment rate with a single-year rolling national Medicaid improper payment rate and incorporating prior year state-level improper payment rate recalculations. The Medicaid Program did not meet its performance target with 6.7 percent payment error rate estimated, an increase from the previous year. CMS met its target for the CHIP performance indicator, with 6.5 percent estimate of payment errors, below the 7.1 percent reported the previous year.

Plans for the Future

ACL expects the targeted number of clients served for home and community-based services to vary between FY 2014 and FY 2016 as delayed effects of sequestration may occur. Recent performance improvements reflect the success of ongoing initiatives to improve program management and expand options for home and community-based care. Aging and Disability Resource Centers (ADRCs) and increased commitments and partnerships at the state and local levels have all had a positive impact on program efficiency.

Despite a growing backlog of cases, OMHA will continue to strive to meet customer expectations and maintain customer satisfaction levels.

Achieving full enrollment in Head Start programs can be difficult due to the wide variation in grantee size/type and changing community demographics; however by FY 2016, the program expects under-enrollment in Head Start programs to be 0.1 percentage point less than the FY 2015 actual result through continued program support and technical assistance. Error rates in the Title IV-E foster care program have dropped. Of the 15 states reviewed during the FY 2014 reporting period, nine had error rates below five percent; and six of those nine states had error rates below one percent. In contrast, three of the 15 states had error rates above 10 percent. In light of recent performance, ACF has adjusted out-year targets and will continue to work with states to strengthen oversight of Title IV-E eligibility and address payment errors in order to move toward the target of 5.3 percent for FY 2015 and 5.1 percent for FY 2016. Historical trend data for the CSBG administrative funds expended performance measure have fluctuated, with sub-grantees spending between 16 and 23 percent on administrative expenses. Given recent performance on this measure, ACF aims to meet a target level of 16 percent for fiscal years 2014 through 2016. To accomplish future targets, the ACF Office of Community Services (OCS) will continue to monitor and to provide training and technical assistance to CSBG grantees in the areas of cost effective program administration and organizational efficiency. In addition, OCS is supporting two Centers of Excellence that support organizational standards and performance management efforts. OCS plans to continue these efforts through FY 2016.

In order to protect the integrity of the Medicare Trust Fund, CMS must ensure that the correct Medicare payments are made to legitimate providers for covered, appropriate and reasonable services for eligible beneficiaries. CMS will enhance its efforts to reduce improper payments for Medicare FFS and Medicare Parts C and D and continue to use predictive analytics to focus on areas where incidence or opportunity for improper payments and/or fraud is greatest, with the expectation that error rates will decline in FY 2015 and FY 2016 for Medicare Fee-for-Service and Part C. The target for Part D has been set at 3.5 percent for FY 2015 and 3.4 percent for FY 2016. In addition, through its efforts to use predictive techniques to reduce fraud, CMS continue to focus its efforts to increase the percentage of Medicare providers and suppliers identified as high risk that receive an administrative action.

CMS also plans to continue implementing effective corrective actions across states to decrease improper payments, including those associated with errors related to Medicaid and the Children’s Health Insurance Program. 

Objective Progress Update Summary

HHS demonstrated progress toward this objective as shown by the representative performance measures described in the HHS Annual Performance Plan and Report. Further evidence of progress is described below.

• CMS made significant progress using the Fraud Prevention System (FPS) to identify bad actors and take administrative action to protect the Medicare Trust Funds. In the second implementation year, which aligned with Fiscal Year 2013, CMS took administrative action against 938 providers and suppliers due to the FPS. The identified savings, certified by the OIG, associated with these prevention and detection actions due to FPS was $210.7 million, almost double the amount identified during the first year of the program. This resulted in more than a $5 to $1 return on investment, an increase from last year’s $3 to $1 return.
• In 2013, CMS launched the Healthcare Fraud Prevention Partnership (HFPP) with the OIG within HHS, the U.S. Department of Justice, and the Federal Bureau of Investigation, private health insurance companies, and other health care and anti-fraud groups and associations to enhance the efficacy of CMS in identifying and preventing fraud, waste, and abuse in the Medicare and Medicaid programs.
• HHS encourages state Temporary Assistance for Needy Families (TANF) agencies to use employment data from the National Directory of New Hires to identify unreported and underreported income, thereby reducing improper assistance payments.
• In addition, ACF uses Title IV-E Foster Care Eligibility Reviews to ensure program eligibility of foster care payment recipients.
• The Secretary has launched a Department-wide program integrity initiative to ensure that every program prioritizes risk management. Linking financial, programmatic, and performance data helps provide an unprecedented level of transparency and accountability and ensures program efficiency and effectiveness.
• Medicare Fee-for-Service (FFS) uses the Comprehensive Error Rate Testing (CERT) program to calculate the improper payment estimate.  The factors contributing to improper FFS payments are complex and vary from year to year.  Improper payment data garnered from the CERT program and other sources are used to reduce or eliminate improper payments through various corrective actions.  Each year, CMS outlines actions the agency will implement to prevent and reduce improper payments for all categories of error.  While some corrective actions have been implemented, others are in the early stages of implementation.  CMS believes that focused corrective actions will have a larger impact over time as they become integrated into business operations.  Corrective actions include final rules, policy changes and use and testing of prior authorization for certain payment types.  For more information on corrective actions see the 2014 HHS AFR.
• In order to reduce the national Medicaid and Children’s Health Insurance Program error rates, states are required to develop and submit corrective action plans (CAPs) to CMS. CAPs will focus on helping states comply with new system requirements, increasing provider communication and education to reduce errors related to missing or insufficient documentation and also targeting eligibility errors through the leveraging of technology and available databases to obtain eligibility verification information without client contact. CMS will also provide caseworker training and additional eligibility policy resources through a consolidated manual and web-based training. CMS has also implemented additional efforts to lower improper payments rates including provider outreach, mini-Payment Error Rate Measurement (PERM) audits and best practice calls. For more information on corrective actions see the 2014 HHS AFR - PDF.

⁷⁷ This target has been revised in light of the recent data trend.

⁷⁸ The FY 2014 target for this performance measure has been revised in light of the most recent data trend.

⁷⁹ The FY 2015 target for this performance measure has been revised in light of the most recent data trend.

⁸⁰ The FY 2016 target for this performance measure has been revised in light of the most recent data trend.

⁸¹ In the FY 2012 Agency Financial Report (AFR), HHS refined its error rate estimation methodology to reflect activity related to the receipt of additional documentation and the outcome of appeals decisions that routinely occur after the cut–off date for the published AFR. The error rate and target for FY 2011 has been adjusted to reflect this revised methodology.

⁸² On August 29, 2014, CMS announced that, to more quickly reduce the volume of inpatient status claims currently pending in the appeals process, CMS is offering an administrative agreement to any hospital willing to withdraw their pending appeals in exchange for timely partial payment (68 percent of the net allowable amount). The settlement is intended to ease the administrative burden for all parties. Any claims in the sample that are included in a settlement will still be considered improper for the measurement.

⁸³ The FY 2014 results will be available in November 2014, at which time the FY 2016 target will be determined.

⁸⁴ 27% is the FY 2012 baseline for this goal calculated based on the result of leads at the end of the first year of the Fraud Prevention System (FPS) (July 2012). The targets for 2013 and 2014 are calculated by increasing the baseline by 15% each year.

⁸⁵ Previously MCD1.1 in the FY 2013 HHS APP/R as 7.4%. Target/reporting schedule revised to comply with the current HHS Agency Financial Report (and to be consistent with other Medicare error rate measures).

⁸⁶ Previously as MCD1.1 in the FY 2013 HHS APP/R as 6.4%. Target/reporting schedule revised to comply with the current HHS Agency Financial Report (and to be consistent with other Medicare error rate measures).

⁸⁷ Previously as MCD1.1 in the FY 2013 HHS APP/R as TBD. Target/reporting schedule revised to comply with the current HHS Agency Financial Report (and to be consistent with other Medicare error rate measures).