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Update on Medicaid’s Payment Error Rate Measurement Program

This article is fifth in a series on the Payment Error Rate Measurement (PERM) program. The Improper Payments Information Act of 2002 (HR 4878) requires federal government agencies to estimate their improper payments annually. The Agency for Health Care Administration (the Agency) is Florida’s single state agency that administers the state’s Medicaid program; this includes the administration and management of funding for the State Children’s Health Insurance Program (SCHIP), also known as Florida KidCare. The Agency is cooperating with the Centers for Medicare and Medicaid Services (CMS) in this effort. These updates provide additional information on PERM as the program evolves, and program requirements are refined by CMS.

The implementation of PERM is now underway in Florida. CMS national contractors have begun collecting data on claims payments for services provided to Florida Medicaid beneficiaries during the period October 2007 through September 2008. CMS contractors will select a sample of claims from the universe of all paid claims during the period indicated above and conduct a thorough review of each selected claim for medical necessity and accuracy in both processing and payment, etc. The process requires reviewing supporting documentation, including medical records. If you are contacted by Livanta requesting medical records or supporting documentation, these records should be provided to Livanta within 60 days of first receiving the request, with the following requirements:

  • Supporting medical records and documentation, and must be for the specific claim and service identified;
  • Supporting medical records and documentation must be complete;
  • Supporting medical records and documentation should be for services provided between October 1, 2007 and September 30, 2008 only; and
  • If your records and documentation are at another location, please inform Livanta immediately of this fact and provide them with correct contact information;
  • If you are contacted by Livanta, and you are not the billing provider or record keeper for the claim, please immediately inform Livanta of this fact, and provide them with the correct name and contact information.

Past PERM results show that, on average, almost 82% of a state’s errors are due to insufficient documentation or no response/no documentation being provided to the contractors; 77% of these errors are due to insufficient documentation. The following steps, if taken now, will help ensure that Florida’s PERM results are not affected by errors, and that Florida Medicaid continues to enjoy a productive relationship with you, its Medicaid healthcare providers:

  • Begin identifying your records and ensuring that supporting documentation is complete for each claim;
  • Begin ensuring that your records and supporting documentation are readily accessible;
  • Ensure that your address and contact information is on file and current with Florida Medicaid; and
  • If you are intending to close up your practice or business before September 30, 2008, please ensure that the custodian for your medical records and supporting documentation is on file with Florida Medicaid.
Please note that claims for which supporting documentation is requested and not provided within the 60-day period will be determined to be improper payments. The federal share of these payments must be returned to CMS, and are recoverable by Florida Medicaid in accordance with federal law.

It is therefore important that providers cooperate by submitting all requested documentation in a timely manner since no response or insufficient documentation will count against the state as an error. If Livanta requests medical records from you and you have any questions regarding their request, please contact Robin Reed, Livanta’s Medical Record Manager, at (301) 957-2380.

HIPAA and Medical Records Requests

Section 1902(a)(27) of the Social Security Act requires providers to retain records necessary to disclose the extent of services provided to individuals receiving assistance, and furnish CMS with information regarding any payments claimed by the provider for medical services, including medical records.

In addition, the collection and review of protected health information contained in individual level medical records, for payment review purposes, is permissible by the Health Information Portability and Accountability Act of 1996 (HIPAA) and implementing regulations at 45 Code of Federal Regulations, parts 160 and 164.

Please review subsequent bulletins or the Florida Medicaid PERM website: http://ahca.myflorida.com/Medicaid/perm/ for additional information on PERM.

We appreciate your continued cooperation with Florida Medicaid. For questions, please contact Karen Chang, Administrator, Office of Medicaid Program Oversight, at (850) 414-2513, or via email at changk@ahca.myflorida. com.