The Centers for Medicare and Medicaid Services (CMS) published a proposed rule on September 23 to strengthen program integrity under Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP). The proposed rule is based on the federal health care reform law. It would expand procedures under all three programs to screen providers before enrollment and to suspend payments after enrollment pending the outcome of investigations. Major impacts on state Medicaid provider enrollment and other Medicaid administrative activities include the need to perform criminal background checks on high risk providers such as suppliers of durable medical equipment (DME); responsibility to check other federal databases on providers, practitioners, owners, and managing employees already sanctioned for improper billing, tax delinquency, and other violations; authority to impose targeted moratoria on new enrollments if necessary to combat fraud; suspension of payments based on a credible allegation of fraud from a hotline complaint, data mining, audit, litigation, or law enforcement investigation; and requirements that practitioners in Medicaid managed care organization (MCO) networks undergo screens. The rules will have major administrative and financial implications for states; e.g., Medicaid FFP will not be available if a state Medicaid agency does not suspend payments pending the investigation of a credible allegation of fraud. State Medicaid agencies will need to obtain the administrative capability and Medicaid Management Information System (MMIS) functionality to ensure compliance with the requirements as soon as they go into effect. States may rely on Medicare screening for providers participating in both programs. The proposed rules apply differently to providers in high, medium, and low risk cohorts, and most aggressively target the types of providers that have triggered massive criminal investigations in recent years. The proposed rules also set forth core elements of an effective ethics and compliance program which providers must adopt and implement as a condition of participation in the federal programs. CMS will consider public comments on the proposed rules until November 16.

About Tom Entrikin

A former policy specialist with the U.S. Health Care Financing Administration (now Centers for Medicare & Medicaid Services (CMS)), Tom Entrikin has vast experience providing technical assistance to states on Medicaid eligibility, coverage, and reimbursement; provider certification and enrollment; program integrity; recovery of third party liabilities; Medicaid Management Information System (MMIS) performance specifications and operations; interagency agreements; contracts with managed care organizations; and Medicaid waiver programs.

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