Behind the Switch to EDS: Why CMS Has 2016 in Sight

According to an article recently published in Medicare Advantage News, the switch to encounter data systems (EDS) for risk adjustment is on the horizon. With 98% of Medicare Advantage (MA) organizations fully certified by the Centers for Medicare and Medicaid (CMS) in the use of EDS, a full switch could happen by 2016.

Although CMS issued a memorandum on May 22, 2013 stating that they will use RAPS submissions for payment year 2014 (2013 dates of service), it is likely that they will start using EDS submissions for payment year 2015 (2014 dates of service). They had originally planned to begin using the EDS submissions for payment year 2014.

There is one key factor behind this delay: CMS relaxed the timely filing requirement to allow plans to ensure submission of complete data. This has been a challenge for plans due to the rapidly changing edit requirements, which inevitably occurred because CMS is using edits based on fee-for-service (FFS).

When CMS mandated the switch from RAPS submissions to EDS submissions, they envisioned managing the data quality by “black-boxing” the Medicare fee-for-service (FFS) Common Edit Module (CEM). However, given that CMS wants the post-adjudicated claims data from the plans in the X12 837I/P, along with other data requirements specific to the MA industry, there are a number of very unique data submission scenarios that do not make a black-box solution workable. This was discovered over the past two years of testing and certifications; plans and third-party submitters had to keep pace with these edit changes as they developed their data quality management programs. Having plans submit a wide range of claim types has assisted CMS in fine-tuning the Common Edit Module to accommodate the MA industry’s data quality needs. CMS has only recently allowed the submission of skilled nursing and home health data, largely because of the very complicated editing that occurs for these claim types.

This bodes well for plans because CMS will have a more complete data set against which to perform the critical comparative analytics between the RAPS and corresponding EDS submissions, and to ensure that when they set the performance metrics around quality, accuracy, and quantity they are doing so with an accurate and complete picture of the industry's data as whole.

Diluting of the risk model can occur with incomplete data, which of course affects the risk-adjusted payment to the plans. CMS wishes to avoid this by relaxing timely filing in hopes to maximize the completeness of the data submitted. There is also ICD10 to contend with, as the compliance date is October 1, 2014 and many plans are still having challenges with implementation.

It would not be surprising if the date to use EDS submissions is pushed to 2016 (2015 dates of service). As long as plans are addressing data quality issues proactively and ensuring that all data is submitted, it should be a smooth transition once CMS discontinues the parallel processing period and uses EDS as the sole basis for payment.