June 18, 2009

RACs, MACs, ZPICs and MICs — All Poised to Review Payment Errors for CMS

By

cservais120dsBy Cheryl E. Servais, MPH, RHIA; VP, Compliance and Privacy Officer


The healthcare industry has been so focused on the coming implementation of the Recovery Audit Contractor (RAC) process that it may have lost sight of other groups that are contracting with federal and state agencies to search for evidence of improper billing and overpayments.


The data mining techniques being applied by the RACs to Medicare claims data also represent the basis for determining review targets for a host of similarly "acronymed" contract organizations.

 

 

MACs - Medicare Administrative Contractors are the groups that process claims for both Part A and Part B services. These groups are charged with overseeing claim completion and accuracy in addition to determining correct payments for services. Since MACs review both facilities' Part A claims and the professional provider Part B claims related to the same beneficiaries and services, CMS feels that the MACs will be able to review discrepancies between the two sets of claims, revise payments and/or increase denials.

 

Eventually, it is anticipated that the MACs will revive the Comprehensive Error Rate Testing (CERT) program and, hopefully, once again issue to providers the PEPPER reports that provide statistics on error frequency and type.

 

ZPICs - Zone Program Integrity Contractors, a group formerly known as Program Safeguard Contractors (PSCs), serve the same jurisdictions as the Medicare Administrative Contractors. The ZPICs are authorized to conduct investigations, provide support to law enforcement and conduct audits of Medicare advantage plans. Some ZPICs will concentrate on various Medicare billing "hot" targets.

 

According to the Medicare Program Integrity Manual, Chapter 2, the goals of the ZPIC's data analysis program are to identify provider billing practices and services that pose the greatest financial risk to the Medicare program. Specifically, ZPIC's are intended to:

 

  • Identify areas of potential errors (e.g. services that may not be covered or incorrectly coded) that pose the greatest risk;
  • Establish baseline data to enable the contractor to recognize unusual trends, changes in utilization over time or schemes to inappropriately maximize reimbursement;
  • Identify where there is a need for LCD;
  • Identify claim review strategies that efficiently prevent or address potential errors (e.g. prepayment edit specifications or parameters);
  • Produce innovative views of utilization or billing patterns that illuminate potential errors;
  • Identify high volume or high cost services that are being widely over-utilized. This is important because these services do not appear as an outlier and may be overlooked when, in fact, they pose the greatest financial risk; and
  • Identify and target program areas and/or specific providers for possible fraud investigations.

 

MICs - Medicaid Integrity Contractors will review Medicaid claims to see whether inappropriate payments or fraud may have occurred. In addition, the MICs will audit Medicaid claims and identify overpayments and areas of high risk for payment errors or fraud. Similar to the RACs, the MICs will use a data-driven approach to focus efforts on aberrant billing practices. Some possible targets include the following:

 

  • Services provided after the death of a beneficiary

  • Duplicate claims

  • Unbundling of services

  • Outpatient claims with service dates that overlap dates of an inpatient stay

 

MICS also will review medical records to verify that paid claims were for the following services:

 

  • Services actually provided and properly documented in accordance with medical necessity;

  • Services billed properly, using correct and appropriate diagnosis and procedure codes;

  • Covered services; and

  • Services paid for in accordance with federal and state laws, regulations and policies.

 

Some providers have voiced concerns that the same safeguards contained in the RAC program are not present in the other review contractors. For example, there do not appear to be limits on the numbers of medical records or claims that can be requested for review.

 

MACs can conduct post-payment reviews up to four years after payment, in contrast to the three-year limit for the RAC. MACs will not be required to provide reimbursement for copying of medical records as RACs are required to do for inpatient records. MIC processes will vary by state, providing concerns to providers with facilities in more than one state.

 

The processes that providers are implementing to prepare for and respond to the anticipated RAC audits also will be useful in dealing with reviews and audits conducted by MACs, ZPICs, and MICs. However, because of the differences in the review processes, providers will need to be very clear about which group is requesting information related to a claim or group of claims.

 

About the Author


Cheryl Servais has more than 25 years of experience in health information management. In her position at Precyse Solutions, Ms. Servais' responsibilities include planning, designing, implementing and maintaining corporate-wide compliance programs, policies and procedures, and updating them to accommodate changes in federal and other regulations. In addition, she oversees training and development programs related to ethics, compliance and patient privacy; develops and chairs compliance and privacy advisory committees at the executive and board levels; and takes an active role in professional organizations.

 

Cheryl E. Servais, MPH, RHIA

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