RACs, MACs, Z-PICs, Part II of IVCERTS – (Comprehensive Error Rate Testing) To better calculate the performance of the FIs and MACs, as well as to look at the reasons for their errors, CMS decided to look at a number of additional rates. The additional rates include
provider compliance error (how well providers prepared claims for submission)
paid claims error rates (measures how accurately FIs and MACs make coverage, coding, and other claims payment decisions). CERTs randomly select a sample of about 100,000 claims each reporting period.
CERTs review the claims for proper Medicare coverage, coding, and billing rules, and if not in compliance, they assign an overall error rate.
CERTs also identify if providers received overpayment letters or notices of adjustments to be made for claims that were overpaid and underpaid. CERTs are considered the Quality Improvement specialists who track and trend the performance of fiscal intermediaries and Medicare Administrative Contractors.
Z-PICs – Zone Program Integrity Contractors will perform Medicare Program integrity functions for CMS. They will interact with each MAC to handle fraud and abuse issues within their jurisdictions. ZPICs are seen to consolidate the work of present CMS Program Safeguard Contractors (PSCs) and Medicare Drug Integrity Contractors (MEDICs) and are divided into 7 zones.
The Z-PICs act with the Department of Justice and FBI and act as the investigators when fraud is very strongly thought to have been found. The Z-PICs have the power to suspend claims for up to a year and the agency has no appeal recourse during that
Annually, CMS receives 1.2 billion claims. That breaks down to 4.3 million claims per work day, 574,000 claims per hour, and 9,579 claims per minute. Fraud and abuse are on the rise and the pressure is on.
CMS has unleashed the age of the auditor with the advent of the RACs, MACs, CERTs, MICs, Z-PICs, and now, the HEAT.
RACs- The contingency motivated Recovery Audit Contractors (retrospectively focused). The RAC Demonstration Project of 2005-2007 recovered over $1.3 billion, mostly due to medically unnecessary services (45%), incorrect coding (35%), and insufficient documentation (10%). With four RAC approved firms covering specific geographic regions, these auditors are expected to continue their positive recovery program. The RAC demonstration project yielded a cost of only 22 cents for every $1.00 recovered. They are now in place and ready to go at measure. Certain RACs have been held back until all MACs were in place. That is now completed.
MACs –Medicare Administrative Contractors have been transitioning in and replacing the Regional Home Health Intermediaries (RHHIs). There are 15 MACs with 4 focusing only on DME claims. Though providers fear the RACs, they are well aware of the power of the MAC. This auditing body can impose “severe administrative action” such as up to 100% prepayment review, payment suspension, and use of statistical sampling for over payment estimation of claims (current and prospective focus). MACs have power and Congress is encouraging them to use it.
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