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Fighting Fraud, Abuse in Medicaid

CMS Expands PERM Program Nationwide in 2010

By News Staff

More federal government oversight of the Medicaid program is unfolding as CMS expands its Payment Error Rate Measurement, or PERM, program to all fifty states in 2010.
PERM was implemented in 2006 and, in 2008, began using a 17-state rotation whereby each state and the District of Columbia is reviewed once every three years.

States on PERM auditors' radar screens for 2010 are Alabama, California, Colorado, Georgia, Kentucky, Maryland, Massachusetts, Nebraska, New Hampshire, New Jersey, North Carolina, Rhode Island, South Carolina, Tennessee, Utah, Vermont and West Virginia.

"The PERM program looks at how often the payers for Medicaid and the state Children's Health Insurance Program pay correctly, according to program guidelines," said AAFP coding expert Cynthia Hughes, C.P.C.

"This program, along with CMS' related Medicaid Integrity Program, or MIP, are potential risk areas for physicians serving a high volume of Medicaid patients," she added.

CMS Hosts Provider Education Call on June 16

CMS is inviting health professionals serving Medicaid patients in Kentucky, Nebraska, North Carolina, Tennessee and South Carolina to participate in a telephone forum (2-page PDF; About PDFs) on June 16 from 3-4:30 p.m., EDT, to learn more about the agency's Payment Error Rate Measurement, or PERM, program.

Participants in the PERM provider education call will get an overview of the PERM program and learn what actions are required of them if they are involved in a PERM audit. Check CMS' PERM provider page regularly for updates and announcements about the program.
"Physicians should respond promptly to any PERM request for records, or auditors will consider that the claim or claims in question were paid in error," said Hughes. At that point, the Medicaid contractor or the Children's Health Insurance Program contractor can recover the money paid to the physician and report the physician to the MIP contractor for further investigation, she added.

"Most physicians have heard of Medicare's Recovery Audit Contractor, or RAC, program because of the attention it has received in the press, but there's a good chance that many physicians are unaware of the PERM auditors," Hughes said.

Physician should know that the RAC program also will expand its reach to Medicaid providers by the end of this year. The expansion, which must be completed by Dec. 31, is mandated by section 6411 of H.R. 3590, the Patient Protection and Affordable Health Care Act, enacted in March.

"RAC companies working to recover money for Medicaid will earn a percentage of monies recovered, just as they do when they recover money for the Medicare program," said Hughes.