Why Medicare and Medi-Cal Plans Must Take a Harder Look at CMS Data Reconciliation
CMS data reconciliation is no longer just a back-office task—it’s a strategic imperative. For Medicare and Medi-Cal plans, getting it right can reduce audit risk, protect revenue, and improve the member experience.
By Julie Hughes, Chief Compliance & Consultancy Officer, Imagenet; and Sherrell Johnson, Director of Health Plan Operations, Cody Consulting Group
In today’s regulatory climate, Medicare Advantage (MA) and Medi-Cal plans face mounting pressures to reconcile the increasing volume of CMS data they rely on to operate. When CMS files are incomplete, outdated, or misaligned, the consequences are far-reaching—from lost premium revenue to member abrasion to audit exposure.
As we prepare to speak at the California Association of Health Plans (CAHP) seminar, Medicare in California: Insights & Shifting Market Dynamics, on May 13, 2025, we’ll be exploring this very issue—why data reconciliation isn’t just a back-office function, but a strategic lever for compliance, operations, and finance teams alike.
The Cost of Data Disconnects
MA and Medi-Cal plans are tasked with managing multiple CMS data files, including the Monthly Membership Report (MMR), Monthly Late Enrollment Penalty (LEP) Data, and Other Health Insurance (OHI). Each file contains critical information used to determine eligibility, payment, and member coverage status. Yet these files are often riddled with duplications, timing discrepancies, and outdated records. When plans rely on this data without a formal reconciliation process, the result is not just administrative inefficiency—it’s financial loss and heightened audit risk.
For example, if a member is incorrectly identified as having employer group coverage, the plan’s Part C capitation payment can be reduced by as much as 82%, retroactive for up to 36 months. Without timely reconciliation, these revenue leaks may go undetected until they appear in a CMS one-third financial audit.
Member Impact Is the Hidden Risk
Beyond financial implications, data inaccuracy introduces real risks for members. When OHI is misapplied, members can experience delays or denials in accessing medications or services. This is especially critical for Medi-Cal populations, who often have more complex health needs and may be less able to navigate administrative hurdles. Left unaddressed, these breakdowns can escalate into complaints, grievances, and even regulatory findings.
The Reconciliation Opportunity
Effective reconciliation isn’t just about closing gaps—it’s about operational transformation. Forward-thinking plans are implementing structured workflows that integrate CMS data with internal systems to detect and resolve discrepancies early.
At Imagenet and Cody Consulting Group, we help health plans implement scalable, repeatable reconciliation processes that:
Align CMS data with real-time member eligibility
Identify and recover missed premium revenue
Prevent erroneous disenrollment
Correct outdated or duplicate OHI entries
Ensure delegated entities adhere to coordination of benefits (COB) and reporting standards
Staying Ahead of Oversight
CMS has increased scrutiny of reconciliation and COB practices, particularly during one-third financial audits. Health plans must be audit-ready—not only with accurate data but with documented processes, delegation oversight, and timely issue resolution.
To prepare, plans should:
Establish cross-functional teams across compliance, operations, and IT
Maintain documentation for all reconciliation activities
Regularly validate CMS data against internal systems and vendor records
Leverage analytics to proactively identify and address discrepancies
Why It Matters for Medi-Cal Plans
While much of the regulatory focus lands on Medicare Advantage, Medi-Cal managed care organizations face parallel challenges. Accurate coordination of benefits is essential to prevent inappropriate billing, manage cost of care, and ensure compliance with both state and federal expectations. The lessons learned from CMS reconciliation in MA plans are highly transferable—and equally critical—to California’s Medi-Cal environment, particularly as integration initiatives expand.
Reconciling CMS data isn’t just a best practice—it’s a strategic necessity. At Imagenet and Cody Consulting Group, we’ve seen firsthand how the right workflows and oversight can help plans stay audit-ready, protect member experience, and unlock meaningful premium recovery opportunities.
We’ll be diving deeper into this topic during our upcoming session at the CAHP seminar, Medicare in California: Insights & Shifting Market Dynamics, on May 13th in Burbank. Learn more about the event and register to join us.
Struggling with data disconnects that impact compliance, payments, or member experience?
About the Authors:
Julie Hughes serves as Chief Compliance and Consultancy Officer for Imagenet. She leads enterprise-wide compliance strategy and consulting services, with a focus on Medicare Advantage, FDR oversight, and regulatory readiness. Julie brings extensive expertise in building and optimizing compliance frameworks, fraud, waste, and abuse programs, and operational governance for health plans. Her background spans legal, administrative, and consulting roles, enabling her to drive integrated compliance solutions that support quality and performance. Julie holds a Juris Doctor from Temple University’s Beasley School of Law, a Master of Science in Healthcare Administration from St. Joseph’s University, and a BA in Anthropology and Sociology from Tulane University. She is also a Certified in Healthcare Compliance (CHC) and a Certified Professional Coder (CPC).
Sherrell Johnson is Director of Health Plan Operations at Cody Consulting Group, an Imagenet company, where she leads the organization’s Business Process Outsourcing (BPO) services, including project implementation, operational strategy, and client relationship management. With more than 30 years in the health insurance industry—and the past 16 focused on Medicare Advantage and Medicaid—she brings deep operational expertise across enrollment, member engagement, customer service, fulfillment, claims, reconciliation, and quality programs. Sherrell is Lean Six Sigma Green Belt Certified and has also served as a national facilitator of Diversity and Inclusion trainings through the Kaleidoscope Group.