CMS Pub. 100-08, ch. 1, § 1.3.1

A. CERT Contractors

The CMS implemented the CERT program which establishes error rates and estimates of

improper payments that is compliant with the Improper Payments Elimination and

Recovery Improvement Act (IPERIA).

B. MACs

The MACs primarily use error rates produced by the CERT program and vulnerabilities

identified through the Recovery Audit program to identify where to target their improper

payment prevention efforts. The MACs analyze their internal data to determine which

corrective actions would be best to prevent the CERT-identified and Recovery Auditor-identified vulnerabilities in the future. The CMS has determined that most improper

payments in the Medicare FFS program occur because a provider did not comply with

Medicare’s coverage, coding, or billing rules. The cornerstone of the MACs’ efforts to

prevent improper payments is each contractor’s Error Rate Reduction Plan (ERRP),

which includes initiatives to help providers comply with the rules. These initiatives

usually fall into one of three categories:

1. Targeted provider education to items or services with the highest improper

payments,

2. Prepayment and postpayment claim review targeted to those services with the

highest improper payments. In addition, in order to encourage providers to

submit claims correctly, MACs can perform extrapolation reviews as needed, and

3. New or revised local coverage determinations, articles or coding instructions to

assist providers in understanding how to correctly submit claims and under what

circumstances the services will be considered reasonable and necessary.

See section 1.3.6, for information on quality of care and potential fraud issues.

C. Recovery Auditors

Although CMS, through the MACs have undertaken actions to prevent future improper

payments, it is difficult to prevent all improper payments, considering that the Medicare

FFS program processes more than 1 billion claims each year. The CMS uses the

Recovery Audit program to detect and correct improper payments in the Medicare FFS

program and provide information to CMS and review contractors that could help protect

the Medicare Trust Funds by preventing future improper payments.

D. Supplemental MR Contractor (SMRC)

The Supplemental Medical Review Contractor’s (SMRC) main tasks are to perform

and/or provide support for a variety of tasks aimed at lowering the improper payment

rates and increasing efficiencies of the medical review functions of the Medicare and

Medicaid programs. Having a centralized medical review (MR) resource that can perform

large volume MR nationally allows for a timely and consistent execution of MR review,

activities and decisions. The focus of the reviews may include but are not limited to

issues identified by CMS internal data analysis, the CERT program, professional

organizations and other Federal agencies, such as the OIG/GAO and comparative billing

reports.