Payment Error Rate Measurement in North Carolina

In compliance with the Improper Payments Information Act of 2002, the Centers for Medicare and Medicaid Services (CMS) implemented a Payment Error Rate Measurement (PERM) program to measure improper payments in the Medicaid program and the State Children’s Health Insurance Program (SCHIP).  North Carolina has been selected as one of 17 states required to participate in PERM reviews of claims paid in Federal fiscal year 2007 (October 1, 2006-September 30, 2007).

CMS is using three national contractors to measure improper payments.  One of the contractors, Livanta LLC (Livanta), will be communicating directly with providers and requesting medical record documentation associated with the sampled claims (approximately 800-1200 claims for North Carolina).  Providers will be required to furnish the records requested by Livanta, within a timeframe indicated by Livanta. 

Livanta began requesting medical records for the NC sampled claims on November 20, 2007.  Providers are urged to respond to these requests promptly.  Records are required to be submitted by providers no later than 60 days after issuance of the contractor’s letter requesting such records (PERM Final Rule, Federal Register/Vol. 72, No. 169/Friday, August 31, 2007/Rules & Regulations, pg. 50496).

Providers are reminded of the requirement in Section 1902(a)(27) of the Social Security Act and Federal Regulation 42 CFR Part 431.107 to retain any records necessary to disclose the extent of services provided to individuals and, upon request, furnish information regarding any payments claimed by the provider for rendering services.

Provider cooperation to furnish requested records is critical in this CMS project.  No response to requests and/or insufficient documentation will be considered a payment error.  This can result in a payback by the provider and a monetary penalty for North Carolina Medicaid.

For more information, you may contact the DMA Program Integrity section at 919-647-8000.