4. Human Services, Medicaid Payments, Fraud Prevention, Detection, and Program Integrity

Transcription

1 4. Human Services, Medicaid Payments, Fraud Prevention, Detection, and Program Integrity

2 4. Human Services, Medicaid Payments, Fraud Prevention, Detection, and Program Integrity PCG proposes the following in response to Human Services, Medicaid Payments, Fraud Prevention, Detection, and Program Integrity: 4.3 Recovery Audit Contractors (RACs) to help reduce improper payments for Medicaid health claims and conduct investigations so that DHS can recover the overpayments or identify underpayments. 4.4 Program Integrity, including but not limited to third party recovery of Medicaid payments. A. Description of Relevant Experience PCG has extensive experience working with agencies across the Health and Human Services spectrum to identify overpayments of all types and to improve agencies general approach toward program integrity. In recent years, states have been increasingly conscientious about identifying fraud, waste, and abuse due to the budgetary constraints that have been placed on their health and human services programs. PCG has worked with states to identify providers and recipients who are abusing (sometimes knowingly, sometimes not) the safety net programs that in which they participate. In states across the country, Offices of Inspectors General, Attorneys General, and other oversight bodies have released reports about the weaknesses in their health and human services programs. Minnesota is no exception to this trend. PCG is well aware of the report released by the state of Minnesota Office of Legislative Auditor in January 2009 which questioned the effectiveness of program safeguards surrounding the $400 million spent annually on personal care attendant services. This is an area that PCG identified several years ago as a program that is particularly disposed toward abusive and fraudulent billing. PCG has worked with the state of North Carolina in the past two years to validate over $200 million in personal care assistant and community behavioral health overpayments. Through this experience, we have developed a comprehensive offering that supports our client through the investigations, appeals, and collections phases. This is a workflow and methodology, combined with the powerful fraud and abuse technology of our partner, SAS Solutions, that apply to overpayments across multiple programs and funding sources and we believe that this service may enable MN DHS to identify and recover significant amounts of overpayments. PCG has also worked on the recipient side of many programs to identify and recover assistance payments improperly made to ineligible beneficiaries. In these engagements, PCG serves not only as the collection arm of the state government but also designs systems, workflows, and processes that maximize the identification of overpayments. Whether the subject of June 17, 2011 Page 1

3 overpayments identification, investigation, and collection of overpayments is providers or recipients, PCG s role is that of a strategic partner to our clients so that not only may these funds be recovered wherever possible but also that safeguards are put in place to enhance the integrity of the program or agency for which we are performing these services. PCG has performed several engagements that involve the use of data and data analysis to help state and county agencies perform better in the realm of program integrity, fraud prevention and overpayment recovering. Examples of such efforts are listed below. Since 2000 PCG has been under contract with the Florida Department of Children and Families (DCF) to recover from individuals and households that have been determined to be indebted to the state of Florida as a result of improper receipt of public assistance benefits. In this capacity, PCG provides an end-to-end solution that includes mailing of collections letters, depositing of recovered funds, safeguarding of all data, records, and other sensitive client information in accordance with all confidentiality requirements of public assistance programs. PCG also operates a call center for clients statewide so that clients can ask questions and get the most current information regarding their cases. Through data analysis, PCG can determine how to target outreach efforts, inform the frequency and timing of outbound calls, and determine trends in repayments. Since 2000 PCG has collected over $27 million in overpayments on behalf of the state of Florida. The Massachusetts Executive Office for Administration and Finance and the Office of the Comptroller contracted with PCG to perform an environmental scan of opportunities for recovery of revenues, including overpayments and the reduction of fraud and abuse, across the state. Over the three month engagement PCG met with key personnel at agencies across the health, human and education services to review priority state expenditures, conducted a review of methods and best practices of revenue recovery, and drafted detailed findings and recommendations. PCG helped the state identify more than $100 million in potential overpayments. In 2010, PCG assisted the Wisconsin Department of Health Services (DHS) to improve program integrity activities. PCG completed an assessment of current fraud prevention, fraud detection, and benefit overpayment recovery processes relevant to the FoodShare (SNAP) and Medicaid programs. To support these efforts, PCG is reviewed and analyzed county office data, county office practices, statewide efforts, and national best practices related to program integrity and benefit overpayment recovery. Since early 2010, PCG has been engaged by the North Carolina Department of Health and Human Services (DHHS) Department to validate and purse Medicaid overpayments related to community Behavioral Health and Personal Care Attendant Services. PCG designed, developed, implemented, and operates a process for performing clinical audits of provider-submitted claims. To date, PCG has reviewed more than 25,000 claim detail records. This review includes an automated series of qualitative confirmations for documentation requirements, units billed, and calculations. Subsequently, clinically June 17, 2011 Page 2

4 trained personnel conduct a qualitative review to ensure that service notes, treatment plans, and service authorizations are necessary and appropriate for the needs and level of service provided. PCG conducts random sampling of claims for identified providers, works directly with the providers to guide them through the review process, and applies extrapolated findings to determine total overpayments, where appropriate. PCG maintains a secure online portal to facilitate the submission of documentation, serves as an access point for clinical reviews, manages provider communications, and reports findings to the client. Of the claims reviewed, the project team has determined over 70% of Medicaid claims from identified providers to be non-compliant, resulting in over $300 million in potential recoupments. Beginning in 2011, PCG has worked with the Wisconsin Department of Health Services (DHS) to implement a program help control the rapid growth of spending on Specialty Pharmacy Products. These drugs represent approximately 25% of the total spend on Pharmacy, yet with only 1% of Medicaid eligibles. The PCG program is designed to use the competitiveness of the open market, along with clinical best practices to incent Specialty Pharmacies to reduce the overall cost of these Specialty Drugs. By awarding preferred status to Specialty Pharmacies based on their total cost per utilizing member, and requiring participating pharmacies to adhere to clinical best practices, PCG and DHS will both improve the outcomes and reduce the cost for Medicaid members who receive Specialty Drugs. Upon implementation, PCG will utilize claims and cost information to calculate and rank providers of Specialty Drugs. Since July 2006, PCG has been engaged by the Colorado Department of Health Care Policy and Financing (HCPF) to design, develop, and implement a district specific reimbursement methodology for the School Health Services (SHS) program. PCG developed a new SHS reimbursement program that complies with evolving CMS guidance featuring interim rates and an annual cost settlement process. PCG assisted HCPF to develop the required State Plan Amendment (SPA) documents necessary to implement the new SHS reimbursement program and in negotiating with CMS in seeking approval of the revised State Plan Amendment. With PCG s assistance, HCPF received approval from CMS for the revised reimbursement program in July Upon CMS approval of the revised SHS reimbursement program, PCG collected cost information that was used in developing interim rates for school districts, ensuring that school districts would not be paid more than cost on an interim basis. PCG also implemented and continues to operate a CMS approved statewide Random Moment Time Study (RMTS) for over 10,000 direct service clinicians and TCM services providers in 85 school districts. As part of the development and implementation of the new SHS reimbursement program, PCG assisted in the development of annual cost settlement documentation including school district cost reports, Certified Public Expenditure policies and procedures, and Audit and Oversight policies and procedures. PCG continues to assist HCPF with audit and oversight functions through desk reviews and audits of the annual cost reports submitted by the school districts. June 17, 2011 Page 3

5 Beginning in 2001, PCG has worked with the Minnesota Saint Paul Public School District as their School Based Fee for Service data collection and claim processing vendor. Since the project started, PCG has processed over $26 million in claims for reimbursement and provided Saint Paul on-site audit support in 2007 that ensured a favorable outcome. EasyIEP as a special education management tool was integrated with EasyTrac with minimal impact on service providers and provided for increased visibility into service prescription trends and provider delivery of service. In July 2002, Minnesota Minneapolis Public Schools selected PCG to implement EasyIEP and EasyTrac as an integrated web-based solution for the management of all special education processes and health service tracking for Medicaid reimbursement. PCG worked closely with MPS administrators to develop an implementation timeline that would accomplish the district s special education objectives, training requirements, and ongoing support needs. In the fall of 2002 just three months after the initial contract signing PCG began the first pilot that resulted in district-wide health service tracking for Medicaid reimbursement. In the next phase of implementation, PCG successfully phased roll-out of the full special education management solution. This implementation was accomplished through alignment with district best practices that ensured compliance with state and federal regulations. In early 2008, MPS users began creating IEPs, Individual Interagency Intervention Plans (IIIP), and Individual Service Plans (ISPs) through EasyIEP s Flexible Interface process-driven module. Compliance is at an alltime high. Staff spends less time writing documents and more time providing student services. B. Description of Proposed Data Analytics Services 4.3 Recovery Audit Contractors (RACs) to help reduce improper payments for Medicaid health claims and conduct investigations so that DHS can recover the overpayments or identify underpayments Data Analysis PCG, in concert with our software partner, SAS Solutions is able to accurately and securely perform intake of Medicaid claims, program eligibility, provider, reference, and other data. PCG has well-established, secured methods of transmission of all data. SAS, a national leader in fraud detection software, will play a lead role in applying its sophisticated technology to the data to identify potentially problematic patterns. Fraud and other activities that lead to improper payments in government programs and services have changed significantly over the past 10 years. Individuals opportunistically taking advantage of lax program controls has given way to more organized and intentional attempts to inappropriately extract benefits or payments from the system. Processes, controls and technology have not kept pace with these changes, leaving government programs ever more exposed and vulnerable to those who attempt to exploit them for personal gain. June 17, 2011 Page 4

6 Modern technology, such as the SAS Fraud Framework, has been proven effective in both the public and private sector at combating fraud and improper payments. When combined and integrated with effective program controls and processes, this technology can assist in both the identification and recovery of improper payments, as well as identifying potential improper activities before services are rendered or payments made. This focus on prevention vs. recovery provides significant value to states who are struggling with budget and resource constraints. The SAS Fraud Framework uses a hybrid approach to detect and deter Medicaid fraud, waste and abuse. \The SAS hybrid approach includes simple business rules, statistical anomaly detection algorithms, predictive models, and Social Network Analytics configured to the data and specific fraud detection objectives. Using the SAS Hybrid Approach to detect fraud waste and abuse our proposed solution can detect a wide scope of problems faced by the EOHHS Agencies. The solution as proposed will be hosted by SAS. The graphic below illustrates how our approach to fraud detection ensures fraud does not slip through the cracks. PCG also offers a school-based Fee-for-Service Medicaid recovery system. With more than 17 years experience working with school districts across the country, PCG has recovered more than $2.4 billion in Federal Medicaid funds for our school clients; more than any other vendor in the country. As the State vendor, our services would focus on three core areas: compliance, documentation accuracy, and revenue maximization, thus ensuring an effective overall FFS Medicaid program. PCG has the ability to offer full, wrap-around Medicaid service expertise to our school clients in all Medicaid areas. June 17, 2011 Page 5

7 EasyTRAC offers clinicians a quick, efficient tool to electronically document services through an easy-to-use, web-based system. It also provides administrators easy access to monitor service documentation and ensure that Medicaid requirements are met. The system has been thoroughly reviewed by CMS and determined to be a compliant method of online documentation. Internet Service Logging Wizard To reduce the time required to log services, EasyTRAC provides users with several service logging wizard options. The service logging wizard presents the appropriate service logging pages for each of the students on the provider s caseload, one after another. Users can choose to skip students so they do not waste time cycling through students. Another feature of the service logging wizard is the ability to pre-fill service logs. With one click, information from the last log entered is pre-filled automatically to make documentation more efficient. All of the information that is pre-filled is re-checked to confirm it is in full compliance with Medicaid regulations. Additionally the system provides the ability to create groups of students seen in a group setting, so a user can quickly log services for several students all at one time. Just as important as documenting services provided, EasyTRAC provides for the specification and storage of all ancillary and related services, programs, and supplemental services. There are no limitations on the number of programs or services assigned to a student. The application stores the required service levels, frequency of service, as well as other pertinent information. In addition to the services, a student s transportation mode and transportation provider can also be tracked. Medicaid Reimbursement Optimization EasyTRAC 's easy-to-use design provides itinerant and other users with an excellent alternate documenting solution. It reduces the documentation burden, provides real-time tracking of service delivery, and increases both compliance and revenue. The system documents all required data for Medicaid billing. Some of its key benefits, which support the optimization of Medicaid reimbursements, include eliminating the need for scanner forms/paper logs, affords clinicians ability to document real time when service is provided, and captures all Medicaid requirements ensuring billing requirements are met. Medicaid Process June 17, 2011 Page 6

8 A high-level depiction of the entire electronic FFS process is outlined below, beginning with system configuration and ending with the claiming process. This is a repetitious process that spans the entirety of the project. PCG also provides ongoing compliance and regulatory support to our clients, provided by PCG s Legal and Regulatory Experts. Program Monitoring EasyTRAC 's extensive reporting power, coupled with program monitoring tools, gives clients the means to maximize revenue and reduce the opportunity for fraud. School-based FFS programs have clear regulation requirements that allow for services provided to students to be reimbursed via Medicaid. PCG provides the necessary tool to document services as well as the reports to effectively manage Medicaid requirements. These requirements can include the need for an IEP health related service prescription, parent consent, certified provider or supervisor, and verification of Medicaid eligibility. June 17, 2011 Page 7

9 PCG is the nation s leading FFS vendor because of exemplary customer service. One differentiating service offered by PCG is the provision of our Mock Audit desk reviews and onsite support during state or federal audits. PCG helps districts prepare for audits by conducting an internal Mock Audit, by pulling student files at random, and checking that all billing requirements are met. In the event a requirement is not met PCG will assist in implementing corrective policies and procedures Advanced Analytics By leveraging historical data regarding known fraud case outcomes (e.g., known fraudulent providers, recipients, networks, and schemes), PCG and SAS can maximize the number of potential cases that may be suspicious by deploying Advanced Analytics techniques. These fraud scenario profiles are used in the review of the enterprise data to uncover similar behavioral patterns and raise alerts on entities and networks that are demonstrating similar fraud attributes as the known cases. SAS Fraud Framework leverages many analytical methods, including neural networks, decision trees, generalized linear models, logistic, partial least squares and quantile regression, econometric (time series) models, text mining and support vector machines to name a few. As depicted in the graphic in the previous section.1, Advanced Analytics is one of the pillars of the SAS Hybrid Approach. The Advanced Analytics functionality maximizes results when paired with the other pillars of the Approach: Business Rules Encode known fraud schemes and indicators and are a good first measure for identifying suspicious activity. Anomaly Detection Compares providers, recipients, and network behaviors and attributes to peer groups and/or historical behavior patterns to highlight activity that is outside the norm and potentially indicative of fraud, waste or abuse. Social Network Analysis (SNA) Fraudsters often act in collusion or recycle information and behaviors to spread their activity across IDs and programs to obtain the maximum financial gain without being detected. By linking all data, including static provider and participant data, case and invoice/transactional data, and unstructured data, the SAS Fraud Framework can uncover these hidden relationships. June 17, 2011 Page 8

10 Linking, however, is not enough - SAS has a patent pending approach, Net-CHAID, to refine these links into meaningful networks for the application of fraud analysis. An effective anti-fraud and improper payments program needs to consider all exposure areas within the program. From initial eligibility determination for recipients and providers, through the point of service delivery, and then throughout the claim and payment process, proper controls and analyses must be in place. Detecting and preventing fraud at the earliest point minimizes losses and greatly reduces the costs associated with detection and recovery. As part of the overall scope of work for this project, PCG proposes to evaluate the state s current processes, controls and technology to detect and prevent fraud, waste and abuse and make recommendations back to the state in our final report regarding areas for potential improvement. Specifically, our report will focus on exposures and opportunities for improvement at the eligibility determination, point of service delivery and post-service payment adjudication stages. We will evaluate the current state and then make recommendations to improve the current state. These recommendations will take into account best practices and business processes, available data sources that may or may not be currently utilized in the state s prevention efforts, modern technology and analysis techniques for fraud detection and prevention, and potential integration points with the state s data systems and business processes. In addition, recognizing that there are likely significant revenue recovery opportunities from past improper payments, we will identify areas where those opportunities exist, and recommend technology and strategies to effective identify and recover those improper payments. The following are specific areas where SAS technology can add value in detection and prevention: Eligibility: By combining data from a variety of data sources within the agency, across agency boundaries and even external to state government, eligibility information can be verified and cross matched across different sources to identify applicants who are potentially ineligible. Both direct comparisons and anomaly detection techniques can be deployed to surface those applicants who warrant a further review. SAS s ability to read data from any data source and sophisticated fuzzy matching capabilities allow us to match records for those who either inadvertently or intentionally provide inaccurate or inconsistent information. The SAS solution provides for the ability to perform a retrospective analysis of all current enrollees to identify recipients already in the system who are ineligible, as well as provide ongoing monitoring for new applicants or determine when current eligible s have a change in status that may make them ineligible. PCG will evaluate current eligibility systems and processes and make recommendations on available data sources and techniques to improve eligibility determination. Point of Service: Identifying inappropriate services before they are rendered greatly reduces losses and enhances the provider / payer relationship. Two areas for June 17, 2011 Page 9

11 improvement at the point of service are identity authentication and appropriateness of service. Technology is available to assist in both of these areas. First, smart identity cards can leverage biometrics or other technology to assist with authenticating that the card holder is the valid owner of the card. The smart capabilities of the card allow providers access to appropriate information about the recipient in order to ensure a more appropriate and beneficial level of care. PCG will evaluate available technology and practices in other states regarding point of service cost avoidance. Payment Process: Integrating detection analytics into the claims payment process allows potentially improper claims to be identified before they are paid. This process requires a degree of integration with the underlying payment system (e.g. MMIS) in order to gather data about the claims, analyze them and send messages back regarding which claims are suspect. The payment system would then route the suspicious claims to a hold queue for further investigation before being deemed improper or released for payment by a claims investigator. PCG will evaluate current payment systems and processes and make recommendations as to options for implementing automated pre-payment review of claims. Documentation Requirements: Developing a service logging page that captures all required service elements in order to generate a valid Medicaid claim. Medicaid requires this data as justification that a service billed to Medicaid was actually provided. Our system is designed to ensure that all of these requirements are met, while still maintaining an easy-to-use format. For each service provided to a child, the provider must document the date of service, service type, duration, group size, an indication of what was covered and assessed, and student progress. The service logging wizard offers streamlined documentation with drop down boxes, spell check, and simple screens. June 17, 2011 Page 10

12 The specific business rules that guide the user through the documentation process allow the proposed solution to filter billing submission, resulting in fewer unsupported claims and a school-based data collection methodology that supports state and federal audit requirements Investigation and Substantiation For those cases approved by MN DHS, the PCG team will implement a detailed case file review process. Our team understands the effort required to obtain the necessary information, prepare a case record, complete a clinical review, respond to appeals and close cases. Our comprehensive workflow ensures cases are established in a prescribed manner and validated using a qualified clinical review team. Our case file review steps will include the following three steps: Step 1: Case Preparation It is through the use of this web-based case management system that the PCG Team will manage all aspects of the case, from intake to appeals. Once PCG has obtained the full volume of claims for a given case, a stratified random sample is selected using OIG-approved RAT-STATS statistical software. PCG follows the below methodology for the selection of an appropriate sample: PCG divides all records within the data warehouse extract into strata, based on the distribution of the paid dollar values of the claims. For each stratum, PCG enters the mean, standard deviation, and universe (count) into the stratified variable sample size determination form in RAT-STATS. June 17, 2011 Page 11

13 Based on the RAT-STATS computation, the sample size is determined for each stratum using the 95% confidence level and 5% precision, provided that the total sample size is greater than 30. PCG then uses RAT-STATS to generate the required number of random numbers based on the sample sizes of each stratum and match these numbers with indexes in the original data. RAT-STATS Variable Sample Size Determination When the claims for review have been selected through this process, they are uploaded to the electronic Provider case file in the PCG web application. The benefit of this process is the use of a statistically sound random sample, which is defensible in an audit setting. The use of this sampling technique also allows MN DHS to recoup dollars based on the extrapolation of findings across the entire universe of claims included in the case under review. The entry of case data and claims data into the system completes the creation of the electronic case file. After a complete file has been created, the PCG web application automatically generates a Provider Record Request Letter, which is then sent, via Certified Mail, to the Provider. All noticing will be approved by MN DHS. After collecting all requested documentation, the Provider may use one of two upload tools embedded in the web site. The first, Java-based, applet allows the Provider to select multiple documents for upload at one time. This is the most time-efficient method for upload, especially considering the volume of documentation to be uploaded. The second upload option is a basic HTTP method directing the Provider to select one document at a time for upload. While this option is less efficient, it does provide a second option for those Providers who are not able to run Java applets on their computer systems. June 17, 2011 Page 12

14 Once all Provider documentation has been received, or ten (10) business days from the date of the Record Request Letter, the case is automatically re-evaluated to determine if any documentation is missing from the case. If there are missing documents, a second Record Request Letter is generated and sent via Certified Mail to the Provider. This second letter will indicate which documents remain outstanding so that the Provider has ample opportunity to submit all required documentation. Step 2: Administrative Review Provider documentation is uploaded to the PCG web application for each case. As provider documents are uploaded, a PCG user will view each document and data-enter specific information pertaining to that document. Once the required data elements have been entered for all Provider documents in a given case, an automated process is initiated by which all documents are matched with the appropriate claim under review, based on such information as Date of Service and / or Consumer Medicaid ID. It is at this point that any documents which continue to be missing would be included in the second Record Request Letter to be delivered to the Provider. Step 3: Clinical Review For complex reviews, once the administrative review is completed, the claims will be moved to the workload for clinical review. We conduct a thorough medical record review using nationally recognized criteria, or we perform desk audits to identify improper payments. PCG staff are trained to identify suspected fraud and abuse, and will report any suspected fraud directly to MN DHS Collection of Overpayments At the completion of the administrative and clinical reviews of all claims in a case, each claim in the sample will have been reviewed, resulting in an over / underpayment or correct payment determination. Using the Stratified Variable Appraisal process in RAT-STATS, an overpayment will be calculated and multiplied by the total number of claims. The result of this process will be a recoupment amount extrapolated over the entire universe of claims, which will then be used in the creation of the Case Findings Summary, to be submitted to the MN DHS and the Provider for recoupment. If a recoupment of overpayment is determined to be appropriate, a Recoupment Letter, including the Case Finding Summary, will be generated, and delivered via Certified Mail to the Provider. The PCG Team expects to work with providers to maximize the collection of overpayments. Our effective approach minimizes the administrative burden on providers, and our experienced auditors and Provider Relations team is available to communicate with providers throughout the recovery process, address concerns, and ensure prompt payment. There are several different options for the collection of overpayments but PCG recommends applying offsets to future claims for each provider. Alternatively, letters may be sent to providers demanding prompt payment. PCG Team staff will be made available to participate in any hearings or appeals regarding the Post Payment Review process, upon the request of the MN DHS. Also at the request of the DHS, June 17, 2011 Page 13

15 PCG will provide all necessary documentation to support the findings and will attend any Hearings to present findings. 4.4 Program Integrity, including but not limited to third-party recovery of Medicaid payments Reporting/Information Extraction Minnesota has an opportunity to generate additional federal revenues through the implementation of a cost settlement process for the Medicaid school based services program. Historically, school based providers have been paid on an established fee schedule at rates below their actual costs for furnishing direct medical services to Medicaid eligible students. Through the implementation of a cost settlement process utilizing a Certified Public Expenditure (CPE) process, school based providers would be paid based on the actual costs incurred for providing these services and the state can leverage those expenditures being incurred by the schools to draw down additional federal matching funds (FFP). The cost settlement process would require participation in a statewide Random Moment Time Study (RMTS), interim billing for direct medical services, and the completion of an annual cost report. The annual cost report would be used to capture the school s expenditures for direct medical service staff, an indirect cost rate, and a Medicaid IEP ratio. Through the combination of the cost report and the RMTS results, a provider-specific Medicaid allowable cost will be calculated. A cost reconciliation and cost settlement process will compare the provider-specific Medicaid allowable cost to that provider s Medicaid interim payments received through their billing activity. Providers with Medicaid allowable costs in excess of their Medicaid interim payments will receive a settlement for the amount of the difference. Providers with Medicaid allowable costs less than their Medicaid interim payments will have a settlement with an amount due to the Medicaid program. PCG has been a national leader in providing billing and claiming solutions for health services provided in a school setting for nearly 20 years. In order to redesign the state s Medicaid school based services program, PCG must first develop a draft implementation plan for state approval and submission to the Centers of Medicare and Medicaid Services (CMS). PCG will leverage our experience to quickly draft the implementation plan and submit the draft document for the state s review and approval within 60 days of the state s decision to pursue this opportunity. PCG has successfully received CMS approval for programs completed on behalf of Louisiana, Georgia, District of Columbia, Michigan, Wisconsin, Kansas, and Colorado in the past 5 years. We understand the requirements of these documents and the specific areas that CMS will review to ensure the implementation plan sufficiently describes the cost reporting and time study processes and is in line with similar plans approved across the country. The following pages provide a more detailed description of PCG s approach to cost settlement for school based health services. This approach is described in two phases; the development phase and the operations phase. In the development phase, PCG will assist the state in June 17, 2011 Page 14

16 developing all necessary State Plan Amendment documents as well as the required supplemental documentation; including the RMTS Implementation Plan, the annual cost report, and cost report instructions. The operations phase includes all of the processes required for the ongoing operation of a cost settlement program, including the training of providers on RMTS and cost reporting, the administration of the RMTS, and the processing of the annual cost reconciliation and cost settlement. PCG realizes that each client is unique and our solution is customized for each client s situation but our general approach is uniform across all clients. The implementation plan submitted to CMS will have the two distinct phases mentioned above with multiple components in each phase: Phase 1: Development 1. Draft Medicaid Public Notice PCG will draft public notice language for the state s Medicaid school based services program state plan amendments. The public notice requirements found in 42 CFR Section require that changes in rates or rate methodologies be public noticed prior to the effective date of the change as the change will require a a description of the reimbursement methodology for each covered service." Since reimbursement for certain services will change, the state should publish a public notice to ensure the integrity of the updates. 2. Draft State Plan Amendments PCG has assisted over a dozen states including Georgia, Colorado, Michigan, Kansas, Louisiana, and the District of Columbia in the development of the necessary State Plan Amendment (SPA) language to support changes to the reimbursement methodology for Medicaid school based services programs. Through these experiences, PCG has developed an intricate understanding of the required components for successful SPA approval. 3. Develop a Qualified Clinician Provider Chart In addition to the development of the SPAs, PCG will also assist the state in completing a comprehensive review of the current requirements for Medicaid providers. Under the current CMS rules, Physician Services, Nursing Services, Delegated Nursing Services, Psychological, Counseling, and Social Work Services, Personal Care Services, Orientation, Mobility, and Vision Services, Speech, Language, and Hearing Services, Occupational Therapy, Physical Therapy, Transportation, and Targeted Case Management are eligible services of a Medicaid school based services program. PCG believes that CMS will require the state to clearly document each qualified clinician in a provider chart. PCG will assist the state in developing a provider chart that documents the CFR reference, SSA reference, Provider Type, and Licensure/Certification Authority. 4. Develop a CMS-Approved RMTS Manual and Implementation Plan PCG has developed an operationally streamlined approach to RMTS implementation in an effort to minimize the burden on state agency staff and employees participating in the Medicaid June 17, 2011 Page 15

17 school based services program. PCG s experience in administering RMTS systems for Medicaid school based services programs includes Massachusetts, New Jersey, Kansas, Michigan, North Carolina, Colorado, Rhode Island, Arizona, District of Columbia, and Georgia. PCG provides a unique understanding of the logistics involved in maintaining the employee rosters necessary for a successful, statewide Medicaid school based services program which optimizes compliance. To accomplish this, we use our unique and nationally deployed web-based software for Medicaid school based services programs, EasyRMTS. 5. Provide a Web-Based Cost Report Forms, Instructions, Interim Rates PCG understands that a change in the reimbursement methodology through a State Plan Amendment would require the state to perform an annual cost settlement and cost reconciliation process. As such, participating school districts would be required to complete annual Medicaid cost reports in order to ensure interim payment rates do not exceed provider costs. PCG has direct experience with this process, having assisted the states of Louisiana, Michigan, Colorado, Texas, District of Columbia, Kansas, Wisconsin, Massachusetts, Georgia, and North Carolina in the development of annual cost reporting forms for school districts. PCG has developed a web-based cost reporting form for our Medicaid school based services program work, making it easily accessible for providers to access and complete. This form will contain the necessary data to facilitate cost reconciliation and settlement such as: salary and wage expenses, unrestricted indirect cost rates, the time percentage pertaining to direct care derived from time study results, Medicaid eligibility rates, and any additional operating costs permitted by CMS and approved by the state. Once the data is entered into the cost reporting form by the providers, the data will undergo a series of edit checks to ensure the essential elements have been completed within the form. If certain mandatory fields are left blank the cost reporting form will alert the provider and not permit submission until the field is populated. In addition, PCG s cost reporting application will store historical data in a robust table for benchmarking purposes for future cost reporting submissions. Phase 2: Operations 1. Execute a Random Moment Time Study (RMTS) within the participating school districts PCG will collect quarterly staff rosters from each school district participating in the FFS programs for RMTS purposes. This data will be collected and maintained within our web-based time study system, EasyRMTS. It is vital that each school district identify all eligible direct service staff and include them in the quarterly time study as only staff eligible for participation in the time study process will be permissible for inclusion in the Medicaid cost settlement process. PCG will provide support to all participating districts so that all allowable personnel are identified and included. After importing each district s staff information, updates for each school district in the statewide database are made to create the sample universe of participants. PCG staff will June 17, 2011 Page 16

18 use EasyRMTS to randomly select moments for the time study process and pair each moment with a randomly selected staff person for activity documentation, in accordance with applicable regulations. In generating the RMTS sample, regulations require the following standards: Statistical Validity PCG follows CMS regulations that require a 95% confidence level with a minimum of +/- 2% precision level be obtained in order to submit a claim. Random Sample PCG follows CMS regulations that require random selection of moments, participants, and sample replacement. EasyRMTS is designed to send moment notifications to the sampled employees. The timing of the notifications can be adjusted and customized by school district. Notifications are usually sent to most school districts with the following time frames: Initial Moment Notification Sent five calendar days prior to the sampled moment. The sampled staff member receives notification of their moment via . The message will contain an overview of the RMTS process and the FFS program. The outlines the employee s role in the program and the importance of their RMTS participation. The will contain the day and time of the sampled moment, contain a hyperlink to the documentation website, the username and password, as well as the tollfree Hotline telephone number to PCG s support staff. Reminder Moment Notification Sent 24 hours before the sampled moment. This message contains the same information as the initial moment notification message but is designed to reinforce the importance of employee participation in the program and remind them of the upcoming moment. Late Notice Typically sent 24 hours after the moment if a response is not received. This message outlines the day and time of the past moment and highlights the fact that the moment is incomplete. This notification copies the school district coordinator or appropriate supervisor. Moments not received within the required time frame will not be used in the calculation of the necessary number of moments needed to satisfy the level of precision of +/- 2% with a 95% confidence interval for activities or in the final time study code percentage calculation. PCG will monitor compliance by generating weekly compliance reports directly from EasyRMTS. Each quarter PCG s central RMTS coder will access all RMTS responses from the EasyRMTS database and code the activity descriptions using the appropriate RMTS activity codes. At the end of the quarter, PCG will compile and generate the time study results. PCG will compile RMTS results to comply with relevant regulations. PCG quality checks include: Ensure statistical validity Once results have been compiled, PCG will ensure that the responses represent a statistically valid sample, as defined by CMS. June 17, 2011 Page 17

19 Compile time study results by job category PCG will calculate time study results by job category to monitor historical trends and to categories to determine appropriateness of job category eligibility. 2. Collect quarterly financial data to generate the annual cost report PCG developed the Medicaid Cost Reporting and Claiming System (MCRCS), our web-based financial reporting application, which allows school districts to report financial data required for Medicaid cost settlement and reconciliation purposes. The system automatically transfers the eligible employees for cost reimbursement from the staff pool lists certified and maintained by school districts in EasyRMTS. The districts will complete the financial data within MCRCS by either manually entering the data directly into our web based system or by exporting and importing the data through our file upload functionality. Once the data is submitted, the MCRCS system performs standard audit checks on the financial data before a school district can certify the financial data. 3. Conduct Medicaid school based services monitoring desk reviews to limit audit findings Federal guidelines require the oversight and monitoring of Medicaid Cost Settlement. The reviews will help ensure that the CMS guidelines are followed and that proper documentation is maintained at the school district and time study participant level. In order to best meet the need for effective oversight, PCG provides CMS approved oversight plans to our clients. Our team will conduct annual monitoring desk reviews on all participating districts and detailed audits on 5% of all participating districts so that all school districts will be monitored on a periodic basis. PCG will prepare a final report as a result of each audit outlining the findings that can be shared with the school districts and the state. Should any remedial action need to occur because the school district fails to meet program requirements or to correct problems identified during review, PCG will work with the state to implement an appropriate corrective action plan. 4. Process the Medicaid Cost Reports PCG will utilize our web-based MCRCS in order streamline the cost reporting process for school districts. Specifically, PCG will work to automate the cost reporting application by populating certain fields within the cost reporting form to reduce the administrative burden to providers. For example, PCG will pre-populate the total revenues received by service and provider from the Medicaid Management Information System (MMIS). PCG comprehensively understands MMIS data and established best practices to efficiently and effectively summarize this data for cost reporting purposes. The MCRCS will be configured and customized to capture the necessary data specific to the state to facilitate Medicaid cost settlement and reconciliation. These elements include: salary and wage expenses, unrestricted ICRs, the time percentage pertaining to direct care derived from time study results, MERs, Medicaid interim payments received by districts June 17, 2011 Page 18

20 throughout the year, and any additional operating costs permitted by CMS and approved by the state. Once the data is pre-populated and entered into the MCRCS by the school districts, the data will undergo a series of automated edit checks to ensure the essential elements have been completed. Once a report has passed all of the edit and audit checks, school districts will be able to certify the cost report and a certification of public expenditures form will be generated for each district to sign and submit to PCG. Once the form is received by PCG, the cost report will be officially completed and will undergo the desk review and settlement process. The MCRCS will be configured to produce management reports for the state oversight. Specifically, PCG will develop and design summary and/or detailed reports according to the state s specifications. 5. Complete annual Medicaid Cost Report Monitoring Reviews and process cost settlements On an annual basis, PCG staff will perform monitoring reviews of Medicaid cost reports and process Medicaid cost settlements. PCG staff has a comprehensive understanding of the relevant state and federal rules and regulations that govern the Medicaid cost settlement and reconciliation processes. This knowledge includes an in-depth understanding of the CMS Provider Reimbursement Manual, OMB Circular A-87 federal cost allocation guidelines, and the specific CMS requirements surrounding the cost reporting process outlined in 42 CFR PCG will leverage this expertise to review cost reports to ensure the cost data submitted by school districts is accurate. 6. Conduct Program Compliance Reviews of MMIS Claims Data PCG understands the importance of operating a Medicaid school based services program that is compliant with federal regulations and maintains accurate reporting of financial costs and claims submissions. In addition to the compliance reviews described in previous sections, PCG will also conduct reviews of Medicaid Management Information System (MMIS) claims data. Ongoing MMIS claims reviews will be conducted on a quarterly basis to ensure appropriate billing practices. Areas to be reviewed include, but are not limited to, the following: claimed/billed rates; reimbursement rates; dates of service; coordination of transportation claims (with a direct medical or health-related Medicaid service by date of service), and procedure codes and modifiers. Sampled districts will be required to provide internal records to support the selected claims including the following: IEP/IFSP effective on date of service; attendance record for the date of service; service logs and/or clinical notes for the date of service, and provider qualifications. At the conclusion of all program compliance reviews, PCG will provide the state with an annual report that will highlight the areas of the SBHS program that are meeting the necessary June 17, 2011 Page 19

21 guidelines and those that are not. For those areas not meeting the necessary compliance guidelines, PCG will work to develop a corrective action plan with the state and school districts to ensure future compliance. 7. Develop Comprehensive Program Manuals PCG will develop a comprehensive program manual for Medicaid school based services program providers. This document will provide a comprehensive overview of the program for all internal and external users Data Analysis PCG can provide data analysis services related to human services fraud prevention, overpayment recovery, and program integrity. Amid increased applications for nutrition assistance, medical assistance, child care and other human service benefits, agencies face program integrity challenges. While trying to manage the day-to-day demands of administering these programs, the focus on program integrity and fraud prevention can blur. Oftentimes, states focus on pay-andchase approaches to recipient fraud rather than front-end prevention. PCG can help assess the effectiveness of recipient fraud prevention and help identify data, policies, procedures or tools that will support program integrity efforts. PCG has experience using state and county data to analyze program integrity efforts and identify trends and/or gaps. In Wisconsin, PCG worked with the state to analyze quantitative and qualitative data to paint a picture of program integrity and overpayment recovery efforts (collections revenue) across the state. PCG also compared state activities to national data to determine how the state compared to others in terms of outputs and outcomes. PCG can review opportunities related to the reduction of SNAP, TANF, and other benefit eligibility program overpayments, including overpayments stemming from client errors, agency errors and participant fraud. When considering recipient error and fraud, there are many telltale signs to help flag error-prone cases. For example, the following questions help identify potentially errant or fraudulent cases: Is there unusual movement of people in and out of the household? Do household expenses exceed total household income? Is reported income information different than tax or employment records? While these should not be new to case workers at the ground level, PCG could help Minnesota review these types of red flags on a larger scale. Through the use of data from external (including wage, new hire, unemployment insurance, tax records and other types of data) and internal sources (from sister agencies that provide human services), there may be an opportunity to systematically identify widespread errors or overpayments. PCG will undertake the following activities to identify and recoup overpayments for these programs. Review Data Matches Data matches, including wage, new hire, unemployment insurance matches and others, can also prevent fraud and overpayments prior to eligibility determination for programs such as Supplemental Nutrition Assistance June 17, 2011 Page 20