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Medicare Contracting Reform. Regional MAC Meeting November 18, 2006 Creighton Gales. Medicare Contracting Reform Defined. MMA Section 911: Medicare Part A and Part B claims processing is integrated into a single entity to increase efficiency, accuracy and system responsiveness

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medicare contracting reform

Medicare Contracting Reform

Regional MAC Meeting

November 18, 2006

Creighton Gales

medicare contracting reform defined
Medicare Contracting Reform Defined
  • MMA Section 911: Medicare Part A and Part B claims processing is integrated into a single entity to increase efficiency, accuracy and system responsiveness
  • Medicare Administrative Contractors (MACs) will perform work currently administered by fiscal intermediaries (FIs) and carriers
  • Competitive award of performance-based contracts with award fees; MACs rewarded when CMS operational and policy objectives met
benefits to the medicare program
Benefits to the Medicare Program
  • Improved efficiency in program administration
  • Reduced Medicare payment error rate
  • Sets platform for information technology improvements
  • Better able to meet future programmatic challenges and changes
providers will benefit from new operational structure
Providers Will Benefit from New Operational Structure
  • Competitive process selects for strong customer service
  • Improved provider education and training.
  • Increased payment accuracy and consistency in payment decisions.
  • Interfacing needs for claims processing are simplified because a single A/B MAC will serve as point-of-contact for both Part A and Part B claims.
  • Providers will have input in evaluation of MACs performance through satisfaction surveys.
approach to establishing mac jurisdictions
Approach to EstablishingMAC Jurisdictions
  • The new jurisdictions:
    • Reasonably balance the number of fee-for-service beneficiaries and providers
    • Are substantially more alike in size than existing fiscal intermediary and carrier jurisdictions
    • Will promote much greater efficiency in Medicare’s billion claims a year
contracting reform on track on schedule
Contracting Reform: On Track & On Schedule

MAC Acquisition Plan

  • Start-up Cycle
      • 4 Durable Medical Equipment (DME) MACs and
      • 1 Part A/Part B (A/B) MAC
  • Cycle One -- current primary focus
      • 7 A/B MACs
  • Cycle Two
      • 7 A/B MACs and
      • 4 Home Health/ Hospice MACs
15 a b mac jurisdictions


















15 A/B MAC Jurisdictions
start up cycle dme mac awards
Start-Up Cycle - DME MAC Awards
  • Durable Medical Equipment (DME) MACs awards
    • January 6, 2006
      • Jurisdiction A: National Heritage Insurance Company
      • Jurisdiction B: AdminaStar Federal, Inc.
      • Jurisdiction C: Palmetto GBA, LLC
        • Award protested; GAO upheld protest
        • CMS reopened discussions with offerors in competitive range
      • Jurisdiction D: Noridian Administrative Services
    • September 29, 2006
      • Jurisdiction C: CIGNA Government Services, LLC
        • Protest of award filed with GAO October 6, 2006
        • Decision deadline for GAO: January 16, 2007
dme mac implementation status
DME MAC Implementation Status
  • DME MACs
    • DME MACs Jurisdiction A and Jurisdiction B successfully implemented July 1, 2006
    • DME MAC Jurisdiction D successfully implemented September 30, 2006
    • DME MAC Jurisdiction C’s implementation to be determined
      • Stay on implementation due to protest
start up cycle a b mac award implementation status
Start-Up Cycle – A/B MAC Award & Implementation Status
  • First A/B MAC award
    • Jurisdiction 3 (J3) A/B MAC award made July 31, 2006 to Noridian Administrative Services
    • Implementation being done incrementally
      • Arizona workload transitioned as of October 1, 2006
      • Scheduled to be fully implemented by March 1, 2007
  • Providers in J3 serviced by Mutual will remain with Mutual for now, until HIGLAS is implemented at Noridian
cycle one 7 a b mac acquisitions
Cycle One : 7 A/B MAC Acquisitions
  • Two Requests for Proposal
    • September 28, 2006
      • RFP was published in fedbizopps for

A/B MAC Jurisdictions 4, 5, & 12

    • December 2006
      • RFP planned to be released for A/B MAC Jurisdictions 1, 2, 7, & 13
  • Streamlined process compared to Startup
a b mac jurisdiction 4
A/B MAC Jurisdiction 4

Colorado, New Mexico, Oklahoma, and Texas

a b mac acquisition cycle two
A/B MAC Acquisition: Cycle Two
  • Acquisitions for Cycle Two include:
    • A/B MAC Jurisdictions: J6, J8, J9, J10, J11, J14 & J15, and
    • 4 Home Health/Hospice MAC Jurisdictions
  • Anticipate releasing Requests for Proposal in September 2007; contract awards planned in September 2008
  • Exploring Contract Type/Acquisition Vehicle through recent Request for Information
continued work by functional contractors
Continued Work by Functional Contractors
  • MACs will work cooperatively with functional contractors (current and future)
    • Enterprise Data Centers
    • Beneficiary Call Center
    • Qualified Independent Contractors
    • Coordination of Benefits Contractor
    • MSP Recovery Contractor
    • Healthcare Integrated General Ledger and Accounting System
    • Program Safeguard Contractors
      • Medical Review – DME MACs only
  • All interact/share data to serve FFS Medicare beneficiaries
providers single point of contact
Providers’ Single Point-of-Contact
  • MACs will serve as the single point-of-contact for providers
  • Call your MAC about:
    • Claims
    • Payment
    • Bill submission guidance, etc.
  • MACs are required to be responsive
    • Measured through satisfaction surveys and

other means

mac medical directors and contractor advisory committees
MAC Medical Directors and Contractor Advisory Committees
  • MACs must have at least one Medical Director, but CMS is not stipulating how many.
  • MACs will follow Program Integrity Manual (PIM) requirements for CACs:
    • Modifications to PIM being considered
      • Separate part A advisory committees similar to current Part B committees or combining Part A and Part B committees
      • Utilization of telephone and videoconference meetings to broaden communication
  • A/B MACs will be expected to consolidate Local Coverage Determinations (LCDs) in a jurisdiction and educate providers, as necessary.
  • LCDs should be more streamlined with minimal variance between policies.
moving forward from here
Moving Forward from Here…
  • Our primary objective is to ensure continuity in Medicare FFS operations
    • Essential throughout the procurements and the contract implementation
  • Learn from Startup Cycle Experience
    • Contract Award Protest
    • Possible with each acquisition
    • Can result in implementation delays
  • Flexibility is key
information and comments
Information and Comments
  • Look for updates and additional information on Medicare Contracting Reform on the Medicare Contracting Reform Website:

  • Formal procurement documents will be posted to the federal acquisitions website:

  • Submit comments and questions