MICHIGAN DEPARTMENT OF COMMUNITY HEALTH

NOTICE OF PROPOSED POLICY

Public Act 280 of 1939, as amended, and consultation guidelines for Medicaid policy provide an opportunity to review proposed changes in Medicaid policies and procedures. Please review the policy summary and the attached materials that describe the specific changes being proposed. Let us know why you support the change or oppose the change. Submit your comments to the analyst by the due date specified. Your comments must be received by the due date to be considered for the final policy bulletin. Thank you for participating in the consultation process.

Director, Program Policy Division Bureau of Medicaid Policy and Health System Innovation

Project Number:

1252-Modeling

Comments Due:

November 30, 2012

Proposed Effective Date:

January 1, 2013

Mail Comments to:

Margo Sharp Bureau of Medicaid Policy and Health System Innovation Medical Services Administration PO Box 30479 Lansing, MI 48909 Fax Number: (517) 335-5136 E-mail Address: sharpm1@michigan.gov

Telephone Number: (517) 335-6148

Policy Subject: Claim Predictive Modeling Affected Programs: Medicaid, Adult Benefits Waiver, Children's Special Health Care Services, Children's Waiver, Maternity Outpatient Medical Services, MIChoice Waiver, Plan First! Distribution: All Providers Policy Summary: Effective January 1, 2013, MDCH will begin predictive modeling on all fee-for-service claim types. The process will utilize statistical analysis models to identify and flag Medicaid claims in which there are billing irregularities. Any claim that has been flagged for review will suspend. Purpose: As authorized by the Patient Protection and Affordable Care Act (P.L. 111-148) and required by section 4241 of the Small Business Jobs Act of 2010 (P.L. 111-240), MDCH is using predictive modeling to identify billing irregularities and prevent payment for improperly billed claims. This process will replace/decrease the rate at which funds are recovered through the pay-and-chase model.

Public Comment Cover (07/11)

Michigan Department of Community Health Medical Services A dministration

Distribution: Issued: Subject: Effective: Programs Affected:

All Providers December 1, 2012 (proposed) Claim Predictive Modeling January 1, 2013 (proposed) Medicaid, Adult Benefits Waiver, Children's Special Health Care Services, Children's Waiver, Maternity Outpatient Medical Services, MIChoice Waiver, Plan First!

Beginning January 1, 2013, the Michigan Department of Community Health (MDCH) will implement a new predictive modeling process for all fee-for-service claims submitted though the Community Health Automated Medicaid Processing System (CHAMPS). The predictive modeling process will be part of CHAMPS and will use advanced screening technology to identify billing irregularities. This process is authorized by the Patient Protection and Affordable Care Act (P.L. 111-148), required by section 4241 of the Small Business Jobs Act of 2010 (P.L. 111-240), and will be similar to the Fraud Prevention System screening implemented by the Centers for Medicare and Medicaid Services (CMS) for Medicare. Pursuant to Title 42 of the Code of Federal Regulations, part 433.139 and the authority cited therein, Medicaid providers are subject to reviews in order to ensure compliance with state and federal regulations and the provider agreement with the State of Michigan Medicaid Program. The predictive modeling process will utilize statistical analysis models to identify and flag Medicaid claims in which there are billing irregularities. Any claim that has been flagged for review will suspend with the following Claim Adjustment Reason Code (CARC) and Remittance Advice Remark Code (RARC). The CARC and RARC information will be available in CHAMPS. CARC: 133 The disposition of the claim/service is pending further review. Use Group Code OA. RARC: N10 Payment based on the findings of a review organization/professional consult/manual adjudication/medical or dental advisor. MDCH has contracted with a vendor to review claims flagged by the new predictive modeling process. The review will include a detailed analysis of the claims in question to determine the next step(s) to be taken in the predictive modeling process. This may include a review of medical records and/or past claims. Providers must submit the requested records in a timely manner to avoid denials for lack of documentation. Provision of protected health information contained in medical records is permissible by the Health Insurance Portability and Accountability Act (HIPAA) of 1996 and by the Code of Federal Regulations (CFR) at 45 CFR 160 and 164 for payment review purposes. In addition, both the federal government and MDCH policy require that providers make records available upon request from authorized agents of the state and/or federal government.