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The Centers for Medicare & Medicaid Services (CMS) has completely revamped the current Medicaid Integrity Manual. The new Medicaid Integrity Manual, effective April 3, 2018, will only have two chapters instead of 17.

Chapter one of the new manual is entitled “Medicaid Investigations & Audits” and focuses on the collaboration between Unified Program Integrity Contractors (UPICs) and state Medicaid agencies (SMAs) in conducting investigations and audits. Some of the important highlights from chapter one include the following:

  • UPICs shall collaborate with SMAs. Prior to opening an investigation, the UPIC shall vet providers identified for investigation with the SMA. If the SMA is already conducting an audit or investigation of that provider for similar Medicaid issues, then the UPIC investigation should be cancelled or postponed.
  • UPICs shall screen complaints and leads and consult with the SMA to determine who will proceed with further review of the lead.
  • After vetting leads, UPICs shall investigate leads: review Medicaid claims, suspicious aberrancies and/or establish evidence of potential fraudulent activity and/or improper payments.
  • UPICs shall initiate investigations and obtain data from the SMA.
  • Extrapolation is allowed but a determination must first be made that the state allows extrapolation and that extrapolation is appropriate given the focus of a particular investigation.
  • UPICs shall adhere to the state’s look back period.
  • UPICs shall adhere to required medical review processes. This includes performing a medical review probe of 20-40 claims, unless otherwise specified by the SMA or CMS. 
  • UPICs shall thoroughly document the rationale utilized to make the medical review decision.
  • UPICs shall request and review medical records to make a determination if there is a potential overpayment.
  • Adequate documentation shall support all investigative and medical review findings.
  • Appeal processes are determined by each state, not CMS, and are subject to the state’s Medicaid program requirements.
  • SMAs shall conduct the overpayment settlement negotiations.
  • Implementation of Medicaid payment suspensions are an SMA function.
  • UPICs shall collaborate with the state related to provider revocations and terminations.

Chapter 2 contains the related exhibits for the Medicaid investigations & audits; for example, it contains a sample audit notification letter and a sample close-out letter.

If you have any questions, please contact the attorneys below.

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