[Federal Register Volume 64, Number 232 (Friday, December 3, 1999)]
[Notices]
[Pages 67920-67925]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-31361]
[[Page 67920]]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Health Care Financing Administration
[HCFA-4009-GNC]
RIN 0938-AJ88
Medicare Program; Criteria and Standards for Evaluating
Intermediary and Carrier Performance During FY 2000
AGENCY: Health Care Financing Administration (HCFA), HHS.
ACTION: General notice with comment period.
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SUMMARY: This notice describes the criteria and standards to be used
for evaluating the performance of fiscal intermediaries and carriers in
the administration of the Medicare program beginning January 1, 2000.
The results of these evaluations are considered whenever HCFA enters
into, renews, or terminates an intermediary agreement or carrier
contract or takes other contract actions (for example, assigning or
reassigning providers or services to an intermediary or designating
regional or national intermediaries).
This notice is published in accordance with sections 1816(f) and
1842(b)(2) of the Social Security Act. We are publishing for public
comment in the Federal Register those criteria and standards against
which we evaluate intermediaries and carriers.
DATES: The criteria and standards are effective January 1, 2000.
Comments: Comments will be considered if we receive them at the
appropriate address as provided below no later than 5 p.m. (EDT) on
January 3, 2000.
ADDRESSES: Mail written comments (1 original and 3 copies) to the
following address: Health Care Financing Administration, Department of
Health and Human Services (HHS), Attention: HCFA-4009-GNC, P.O. Box
8016, Baltimore, MD 21244-8016.
If you prefer, you may deliver your written comments (1 original
and 3 copies) to one of the following addresses:
Room 443-G, Hubert H. Humphrey Building, 200 Independence Avenue,
SW., Washington, DC, 20201, or 7500 Security Boulevard, Baltimore,
Maryland 21244.
Because of the staffing and resource limitations, we cannot accept
comments by facsimile (FAX) transmission. In commenting, please refer
to file code HCFA-4009-GNC. Comments received timely will be available
for public inspection as they are received, generally beginning
approximately 3 weeks after publication of a document, in Room 443-G of
the Department's office at 200 Independence Avenue, SW., Washington,
D.C., on Monday through Friday of each week from 8:30 a.m. to 5 p.m.
(phone: (202) 690-7890).
FOR FURTHER INFORMATION CONTACT: Sue Lathroum, (410) 786-7409.
SUPPLEMENTARY INFORMATION:
I. Background
Under section 1816 of the Social Security Act (the Act), public or
private organizations and agencies participate in the administration of
Part A (Hospital Insurance) of the Medicare program under agreements
with the Secretary of Health and Human Services. These agencies or
organizations, known as fiscal intermediaries, determine whether
medical services are covered under Medicare and determine correct
payment amounts. The intermediaries then make payments to the health
care providers on behalf of the beneficiaries. Section 1816(f) of the
Act requires us to develop criteria, standards, and procedures to
evaluate an intermediary's performance of its functions under its
agreement. We evaluate intermediary performance through the contract
management process.
Under section 1842 of the Act, we are authorized to enter into
contracts with carriers to fulfill various functions in the
administration of Part B (Supplementary Medical Insurance) of the
Medicare program. Beneficiaries, physicians, and suppliers of services
submit claims to these carriers. The carriers determine whether the
services are covered under Medicare and the payable amount for the
services or supplies, and then make payment to the appropriate party.
Under section 1842(b)(2) of the Act, we are required to develop
criteria, standards, and procedures to evaluate a carrier's performance
of its functions under its contract. We also evaluate carrier
performance through the contract management process.
We are publishing the criteria and standards in the Federal
Register in order to allow the public an opportunity to comment before
implementation. In addition to the statutory requirement, our
regulations at 42 CFR 421.120 and 421.122 provide for publication of a
Federal Register notice to announce criteria and standards for
intermediaries prior to implementation. Regulation 42 CFR 421.201
provides for publication of a Federal Register notice to announce
criteria and standards for carriers prior to implementation. The
current criteria and standards were published in the Federal Register
on September 7, 1994 (59 FR 46258).
To the extent possible, we make every effort to publish the
criteria and standards before the beginning of the Federal fiscal year,
which is October 1. If we do not publish a Federal Register notice
before the new fiscal year begins, readers may presume that until and
unless notified otherwise, the criteria and standards which were in
effect for the previous fiscal year remain in effect.
In those instances where we are unable to meet our goal of
publishing the subject Federal Register notice before the beginning of
the fiscal year, we may publish the criteria and standards notice at
any subsequent time during the year. If we choose to publish a notice
in this manner, the evaluation period for any such criteria and
standards that are the subject of the notice will be revised to be
effective on the first day of the first month following publication.
Hence, any revised criteria and standards will measure performance
prospectively; that is, we will not apply new measurements to assess
performance on a retroactive basis.
Also, it is not our intention to revise the criteria and standards
that will be used during the evaluation period once this information
has been published in a Federal Register notice. However, on occasion,
either because of Administrative mandate or Congressional action, there
may be a need for changes that have direct impact upon the criteria and
standards previously published, or which require the addition of new
criteria or standards, or that cause the deletion of previously
published criteria and standards. Should such changes be necessitated,
we will issue a Federal Register notice prior to implementation of the
changes. In all instances, necessary manual issuances will be published
each year to ensure that the criteria and standards are implemented
uniformly and accurately. Also, as in previous years, the Federal
Register notice will be republished and the effective date revised if
changes are warranted as a result of the public comments received on
the criteria and standards.
II. Criteria and Standards--General
Basic tenets of the Medicare program are to pay claims promptly and
accurately and to foster good beneficiary and provider relations.
Contractors must administer the Medicare program efficiently and
economically. We have developed a contractor management program for FY
2000 that sets
[[Page 67921]]
expectations for the contractor; measures the performance of the
contractor; evaluates the performance against the expectations; and,
takes appropriate contract action based upon evaluation of the
contractor's performance. The goal of performance evaluation is to
ensure that contractors meet their contractual obligations. We measure
contractor performance to ensure that contractors do what is required
of them by law, regulation and HCFA directive. We ensure that
contractors perform well and continually improve their performance. To
better evaluate contractor performance, we are working to develop and
refine measurable performance standards in key areas, and we will be
facilitating the sharing of ``best practices'' among HCFA reviewers. We
also are increasing the number of standardized evaluation protocols for
use in FY 2000. We have structured contractor evaluation into five
criteria designed to meet those objectives.
The first criterion in the FY 2000 contractor performance
evaluation is ``Claims Processing,'' which measures contractual
performance against claims processing accuracy and timeliness
requirements. Within the Claims Processing criterion, we have
identified those performance standards that are mandated by either
legislation, regulation or judicial decision. These standards include
claims processing timeliness, and the accuracy of Explanations of
Medicare Benefits. Further evaluation in the Claims Processing
criterion may include, but is not limited to, the accuracy of bill and
claims processing, the level of electronic claims payment, and the
percent of bills and claims paid with interest.
The second criterion is ``Customer Service,'' which assesses the
completeness of the service provided to customers by the contractor in
its administration of the Medicare program. Mandated standards in the
Customer Service criterion include the rate of cases reversed by an
Administrative Law Judge, the timeliness of intermediary
reconsideration cases, the accuracy and timeliness of carrier reviews
and hearings, and the accuracy and timeliness of carrier replies to
beneficiary telephone inquiries. In FY 2000, customer feedback may be
used to collect comparable data on customer satisfaction and identify
areas in need of improvement. Among the specific contractor services
that may be included in the evaluation process under the Customer
Service criterion are: beneficiary relations; provider education;
appropriate telephone inquiry responses; and the tone and accuracy of
all correspondence.
The third criterion is ``Payment Safeguards,'' which evaluates
whether the Medicare trust funds are safeguarded against inappropriate
program expenditures. Intermediary and carrier performance may be
evaluated in the areas of medical review, Medicare secondary payer,
fraud and abuse, and audit and reimbursement. Mandated performance
standards in the Payment Safeguards criterion are the accuracy of
decisions on skilled nursing facility (SNF) demand bills, and the
timeliness of processing Tax Equity and Fiscal Responsibility Act
(TEFRA) target rate adjustments, exceptions, and exemptions. Further
evaluation in this criterion may include, but is not limited to, some
core standards for Medical Review and Benefit Integrity.
The fourth criterion is ``Fiscal Responsibility,'' which evaluates
the contractor's efforts to protect the Medicare program and the public
interest. Contractors must effectively manage Federal funds for both
payment of benefits and cost of administration under the Medicare
program. Proper financial and budgetary controls, including internal
controls, must be in place to ensure contractor compliance with its
agreement with HHS and HCFA. Additional functions reviewed under this
criterion may include, but are not limited to, adherence to approved
budget, compliance with the Budget and Performance Requirements, and
adherence to the Chief Financial Officers Act.
The fifth and final criterion is ``Administrative Activities,''
which measures a contractor's administrative management of the Medicare
program. A contractor must efficiently and effectively manage its
operations to ensure constant improvement in the way it does business.
Proper systems security, Automated Data Processing (ADP) maintenance,
and disaster recovery plans must be in place. It must also ensure that
all necessary actions and system changes have been made and tested so
that it is meeting established milestones along the critical path of
HCFA's requirements for millennium compliance. Year 2000 compliant
means information technology that accurately processes date and time
data (including, but not limited to, calculating, comparing, and
sequencing) from, into, and between the centuries (the years 1999 and
2000), and leap year calculations. Furthermore, Year 2000 compliant
information technology, when used in combination with other information
technology, must accurately process date and time data if the other
information technology properly exchanges date and time data with it. A
contractor's evaluation under the Administrative Activities criterion
may include, but is not limited to, establishment, application,
documentation, and effectiveness of internal controls, which are
essential in all aspects of a contractor's operation. Administrative
Activities evaluations may also include implementation reviews of
performance improvement plans, change management plans, and data and
reporting requirements.
We have also developed separate measures for evaluating unique
activities of Regional Home Health Intermediaries (RHHIs). Section
1816(e)(4) of the Act requires the Secretary to designate regional
agencies or organizations, which are already Medicare intermediaries
under section 1816, to perform bill processing functions with respect
to freestanding home health agency (HHA) bills. The law requires that
we limit the number of such regional intermediaries (i.e., RHHIs) to
not more than ten (see 42 CFR 421.117 and the Final Rule published in
the Federal Register on May 19, 1988 (53 FR 17936) for more details
about the RHHIs).
In addition, section 1816(e)(4) of the Act requires the Secretary
to develop criteria and standards in order to determine whether to
designate an agency or organization to perform services with respect to
hospital affiliated HHAs. We have developed separate measures for RHHIs
in order to evaluate the distinct RHHI functions. These functions
include the bills processing of freestanding HHAs, hospital affiliated
HHAs, and hospices. Through an evaluation using these criteria and
standards we may determine whether the RHHI functions should be moved
from one intermediary to another in order to ensure effective and
efficient administration of the program benefit.
Below we list the criteria and standards to be used for evaluating
the performance of intermediaries and carriers. In a number of
instances, we identify a HCFA manual as a source of more detailed
requirements. Intermediaries and carriers have copies of various
Medicare manuals referenced in this notice. Members of the public also
have access to our manualized instructions.
Medicare manuals are available for review at local Federal
Depository Libraries (FDLs). Under the FDL Program, government
publications are sent to approximately 1400 designated public libraries
throughout the United States. Interested parties may examine
[[Page 67922]]
the documents at any one of the FDLs. Some may have arrangements to
transfer material to a local library not designated as an FDL. To
locate the nearest FDL, individuals should contact any public library.
In addition, individuals may contact regional depository libraries,
which receive and retain at least one copy of nearly every Federal
government publication, either in printed or microfilm form, for use by
the general public. These libraries provide reference services and
interlibrary loans; however, they are not sales outlets. Individuals
may obtain information about the location of the nearest regional
depository library from any library. Information may also be obtained
from the following web site: www.hcfa.gov/pubforms/progman.htm. Some
manuals may be obtained from the following web site: www.hcfa.gov/
pubforms/p2192toc.htm.
Finally, all HCFA regional offices maintain all Medicare manuals
for public inspection. To find the location of the nearest available
HCFA regional office, individuals may call the FOR FURTHER INFORMATION
CONTACT individual listed at the beginning of this notice. That
individual can also provide information about purchasing or subscribing
to the various Medicare manuals.
III. Criteria and Standards for Intermediaries
Claims Processing Criterion
The Claims Processing criterion contains 4 mandated standards.
Standard 1--95% of clean electronically submitted non-Periodic Interim
Payment (PIP) bills paid within statutorily specified time frames.
Clean bills are defined as bills that do not require Medicare
intermediaries and/or carriers to investigate or develop external to
their Medicare operations on a prepayment basis. Specifically, clean,
non-PIP electronic claims can be paid as early as the 14th day (13 days
after the date of receipt) and must be paid by the 31st day (30 days
after the date of receipt).
Standard 2--95% of clean paper non-PIP bills paid within specified time
frames. Specifically, clean, non-PIP paper claims can be paid as early
as the 27th day (26 days after the date of receipt), and must be paid
by the 31st day (30 days after the date of receipt).
Standard 3--Reversal rate by Administrative Law Judges (ALJ) is
acceptable. HCFA has defined an acceptable reversal rate as one that is
at or below 5.0%.
Standard 4--75% of reconsiderations are processed within 60 days and
90% are processed within 90 days.
Additional functions may be evaluated under this criterion. These
functions include, but are not limited to the--
Bill processing accuracy;
Attainment of Electronic Media Claims goals;
Establishment and maintenance of relationship with Common
Working File Host;
Management of shared processing sub-contract; and
Analysis and validation of data.
Customer Service Criterion
We may review the intermediary's efforts to enhance customer
satisfaction through the use of customer feedback. Results of the
feedback may be used to establish comparable data on customer
satisfaction and to identify areas in need of improvement. The results
may be summarized for publication in the report of contractor
performance and shared with individual contractors.
Functions which may be evaluated under this criterion include, but
are not limited to, the--
Accuracy, timeliness and appropriateness of responses to
telephone inquiries;
Accuracy of processing reconsideration cases with clear
responses and appropriate customer-friendly tone and clarity;
Accuracy, clearness and timeliness of responses to written
inquiries with appropriate customer-friendly tone and clarity;
Establishment and maintenance of relationships with
professional and beneficiary organizations and using focus groups; and
Conduct of educational and outreach efforts.
Payment Safeguards Criterion
The Payment Safeguard criterion contains 2 mandated standards.
Standard 1--Decisions of SNF demand bills are accurate.
Standard 2--TEFRA target rate adjustments, exceptions, and exemptions
are processed within mandated time frames. Specifically, applications
must be processed to completion within 75 days after receipt by the
contractor or returned to the hospitals as incomplete within 60 days of
receipt.
Additional functions may be evaluated under this criterion. These
functions include, but are not limited to--
Medical Review. We may evaluate if the fiscal
intermediary--
+ Increased the effectiveness of medical review payment safeguard
activities;
+ Exercised accurate and defensible decision making on medical
reviews;
+ Educated and communicated effectively with the provider and
supplier community;
+ Collaborated with other internal components and external entities
to ensure correct claims payment, and to address situations of fraud,
waste, and abuse.
Audit and Reimbursement. We may--
+ Assess the quality of a fiscal intermediary's activities in the
audit and settlement of Medicare cost reports; and
+ Assess the timeliness of Medicare cost report settlements and the
accuracy by which a fiscal intermediary has established interim
provider payments.
Medicare Secondary Payer. We may--
+ Review the intermediary's MSP processes in administering the
program and for identifying and recovering mistaken Medicare payments
in accordance with MIM, Part 3, Secs. 3400ff and 3600ff, and pertinent
HCFA instructions and transmittals;
+ Develop outcome measures to assess the intermediary's accuracy in
reporting savings and to determine if claim development procedures are
followed;
+ Evaluate the accuracy and timeliness of claims payment and
determine if the Common Working File, internal systems and required
software are utilized as prescribed; and
+ Evaluate the contractor's ability to prioritize and process
recoveries in compliance with instructions, determine if recoveries of
all payers are processed equally, and ensure that audit trail
documentation exists.
Fraud and Abuse. We may evaluate if the fiscal
intermediary--
+ Used proactive and reactive techniques in the detection and
development of potential fraud cases;
+ Used other corrective and preventive actions (such as payment
suspensions, Civil Monetary Penalties (CMPs), overpayment assessments,
pre-payment or post-payment claims reviews, system fixes, claim
denials, etc.);
+ Properly developed fraud cases for referral to the Office of the
Inspector General, HHS; and
+ Maintained a good working relationship and extensive networking
with both internal components and external partners.
[[Page 67923]]
Fiscal Responsibility Criterion
We may review the intermediary's efforts to establish and maintain
appropriate financial and budgetary internal controls over benefit
payments and administrative costs. Proper internal controls must be in
place to ensure that contractors comply with their agreements with
HCFA.
Additional matters to be reviewed under the Fiscal Responsibility
criterion may include, but are not limited to--
Adherence to approved budget;
Compliance with the Budget and Performance Requirements;
Adherence to the Chief Financial Officers Act; and
Control of administrative cost and benefit payments.
Administrative Activities Criterion
We may measure a contractor's administrative ability to manage the
Medicare program. We may evaluate the efficiency and effectiveness of
its operation, its system of internal controls, and its compliance with
HCFA directives and initiatives.
A contractor must efficiently and effectively manage its operations
to assure constant improvement in the way it does business. Proper
systems security, ADP maintenance, and disaster recovery plans must be
in place. It must also ensure that all necessary actions and system
changes have been made and tested so that it is meeting established
milestones along the critical path of HCFA's requirements for
millennium compliance. Year 2000 compliant means information technology
that accurately processes date and time data (including, but not
limited to, calculating, comparing, and sequencing) from, into, and
between the centuries (the years 1999 and 2000), and leap year
calculations. Furthermore, Year 2000 compliant information technology,
when used in combination with other information technology, must
accurately process date and time data if the other information
technology properly exchanges date and time data with it. A contractor
must also test standard system changes to ensure the accurate
implementation of HCFA instructions.
HCFA's evaluation of a contractor under the Administrative
Activities criterion may include, but is not limited to, reviews of the
contractor's--
Systems security;
ADP maintenance;
Disaster recovery plan;
Performance Improvement Plans implementation;
Change Management Plan implementation;
Data and reporting requirements implementation; and
Internal controls establishment and use.
IV. Criteria and Standards for Carriers
Claims Processing Criterion
The Claims Processing criterion contains 5 mandated standards.
Standard 1--95% of clean electronically submitted claims processed
within statutorily specified time frames. Specifically, clean
electronic claims can be paid as early as the 14th day (13 days after
the date of receipt) and must be paid by the 31st day (30 days after
the date of receipt).
Standard 2--95% of clean paper claims processed within specified time
frames. Specifically, clean paper claims can be paid as early as the
27th day (26 days after the date of receipt) and must be paid by the
31st day (30 days after the date of receipt).
Standard 3--98% of Explanations of Medicare Benefits (EOMBs) are
properly generated.
Standard 4--95% of review determinations are accurate and clear with
appropriate customer-friendly tone and clarity, and are completed
within 45 days.
Standard 5--90% of carrier hearing decisions are accurate and clear
with appropriate customer-friendly tone and clarity, and are completed
within 120 days.
Additional functions may be evaluated under this criterion. These
functions include, but are not limited to, the--
Claims Processing accuracy;
Attainment of Electronic Media Claims goals;
Management of shared processing sub-contract;
Establishment and maintenance of relationship with the
Common Working File Host; and
Analysis and validation of data.
Customer Service Criterion
The Customer Service criterion contains 1 mandated standard.
Standard 1--Telephone inquiries are answered timely.
Carriers are to achieve a monthly All Trunks Busy Rate of not more
than 5%. For callers choosing to speak with a customer service
representative, 97.5% or more of telephone calls are to be answered
within 120 seconds; no less than 85% are to be answered within the
first 60 seconds.
We may review the carrier's efforts to enhance customer
satisfaction through the use of customer feedback. Results of the
feedback may be used to establish comparable data on customer
satisfaction and to identify areas in need of improvement. The results
may be summarized for publication in the report of contractor
performance and shared with individual contractors.
Additional functions may be evaluated under this criterion. These
functions include, but are not limited to, the carrier's--
Accuracy and appropriateness of responses to telephone
inquiries;
Accuracy, clearness, and timeliness of responses to
written inquiries with appropriate customer-friendly tone and clarity;
Establishment and maintenance of relationships with
professional and beneficiary organizations and using focus groups; and
Conduct of educational and outreach efforts.
Payment Safeguards Criterion
Carrier functions that may be reviewed under this criterion
include, but are not limited to--
Medical Review. We may evaluate if the carrier --
+ Increased the effectiveness of medical review payment safeguard
activities;
+ Exercised accurate and defensible decision making on medical
reviews;
+ Effectively educated and communicated with the provider and
supplier community;
+ Collaborated with other internal components and external entities
to ensure correct claims payment, and to address situations of fraud,
waste, and abuse.
Medicare Secondary Payer. We may--
+ Review the carrier's MSP processes in administering the program
and for identifying and recovering mistaken Medicare payments in
accordance with the Medicare Carriers Manual (MCM, Part 3, Secs. 3375,
4306.3, and 4307-4308.1), and pertinent HCFA instructions and
transmittals;
+ Develop outcome measures to assess the carrier's accuracy in
reporting savings and to determine if claim development procedures are
followed;
+ Evaluate the accuracy and timeliness of claims payment and
determine if the Common Working File, internal systems and required
software are utilized as prescribed; and
+ Evaluate the contractor's ability to prioritize and process
recoveries in compliance with instructions, determine if recoveries of
all payers are processed equally, and ensure that audit trail
documentation exists.
Fraud and Abuse. We may evaluate if the carrier --
[[Page 67924]]
+ Used proactive and reactive techniques in the detection and
development of potential fraud cases;
+ Used other corrective and preventive actions (such as payment
suspensions, CMPs, overpayment assessments, education, pre-payment or
post-payment claims reviews, system fixes, edits, claim denials, etc.);
+ Properly developed fraud cases for referral to the Office of the
Inspector General, HHS;
+ Maintained a good working relationship and extensive networking
with both internal components and external partners.
Fiscal Responsibility Criterion
We may review the carrier's efforts to establish and maintain
appropriate financial and budgetary internal controls over benefit
payments and administrative costs. Proper internal controls must be in
place to ensure that contractors comply with their agreements with
HCFA.
Additional matters to be under the Fiscal Responsibility criterion
may include, but are not limited to--
Compliance with the Budget and Performance Requirements;
Adherence to approved budget;
Adherence to the Chief Financial Officers Act; and
Control of administrative cost and benefit payments.
Administrative Activities Criterion
We may measure a carrier's administrative ability to manage the
Medicare program. We may evaluate the efficiency and effectiveness of
its operation, its system of internal controls and its compliance with
HCFA's directives and initiatives.
A contractor must efficiently and effectively manage its operations
to assure constant improvement in the way it does business. Proper
systems security, ADP maintenance, and disaster recovery plans must be
in place. It must also ensure that all necessary actions and system
changes have been made and tested so that it is meeting established
milestones along the critical path of HCFA's requirements for
millennium compliance. Year 2000 compliant means information technology
that accurately processes date and time data (including, but not
limited to, calculating, comparing, and sequencing) from, into, and
between the centuries (the years 1999 and 2000), and leap year
calculations. Furthermore, Year 2000 compliant information technology,
when used in combination with other information technology, must
accurately process date and time data if the other information
technology properly exchanges date and time data with it. Also, a
contractor must test standard system changes to ensure accurate
implementation of HCFA instructions.
A carrier's evaluation under this criterion may include, but is not
limited to, reviews of--
Proper systems security;
ADP maintenance;
Disaster recovery plan;
Performance improvement plans implementation;
Change management plan implementation;
Data and reporting requirements implementation; and
Internal controls establishment and use.
V. Regional Home Health Intermediaries' (RHHIs') Criterion
The following standards are mandated for the Regional Home Health
Intermediaries' criterion:
Standard 1--95% of clean electronically submitted non-PIP HHA/hospice
bills paid within statutorily specified time frames. Specifically,
clean, non-PIP electronic claims can be paid as early as the 14th day
(13 pays after the date of receipt) and must be paid by the 31st day
(30 days after the date of receipt).
Standard 2--95% of clean paper non-PIP HHA/hospice bills paid within
specified time frames. Specifically, clean, non-PIP paper claims can be
paid as early as the 27th day (26 days after the date of receipt) and
must be paid by the 31st day (30 days after the date of receipt).
Standard 3--75% of HHA/hospice reconsiderations are processed within 60
days and 90% are processed within 90 days.
We may use this criterion to review a RHHI's performance with
respect to handling the HHA/hospice workload. This includes processing
HHA/hospice bills timely and accurately, properly paying and settling
HHA cost reports, and timely and accurately processing reconsiderations
from beneficiaries, HHAs, and hospices.
VI. Action Based on Performance Evaluations
A contractor's performance is evaluated against applicable program
requirements for each criterion. Each contractor must certify that all
information submitted to HCFA relating to the contractor management
process, including without limitation all records, reports, files,
papers and other information, whether in written, electronic, or other
form, is accurate and complete to the best of the contractor's
knowledge and belief. A contractor will also be required to certify
that its files, records, documents, and data have not been manipulated
or falsified in an effort to receive a more favorable performance
evaluation. A contractor must further certify that, to the best of its
knowledge and belief, the contractor has submitted, without withholding
any relevant information, all information required to be submitted with
respect to the contractor management process under the authority of
applicable law(s), regulation(s), contracts, or HCFA manual
provision(s). Any contractor that makes a false, fictitious, or
fraudulent certification may be subject to criminal and/or civil
prosecution, as well as appropriate administrative action. Such
administrative action may include debarment or suspension of the
contractor, as well as the termination or nonrenewal of a contract.
If a contractor meets the level of performance required by
operational instructions, it meets the requirements of that criterion.
Any performance measured below basic operational requirements
constitutes a program deficiency. The contractor will be required to
develop and implement a Performance Improvement Plan for each program
deficiency identified. The contractor will be monitored to ensure
effective and efficient compliance with the performance improvement
plan, and to ensure improved performance where requirements are not
met. The contractor will also be monitored when a program vulnerability
in any performance area is identified. A program vulnerability exists
when a contractor's performance complies with basic program
requirements, but one or more weaknesses are present which could result
in deficient performance if left ignored.
The results of performance evaluations and assessments under all
five criteria will be used for contract management activities and will
be published in the contractor's annual performance report. We may
initiate administrative actions as a result of the evaluation of
contractor performance based on these performance criteria. Under
sections 1816 and 1842 of the Act, we consider the results of the
evaluation in our determinations when--
Entering into, renewing, or terminating agreements or
contracts with contractors;
Deciding other contract actions for intermediaries and
carriers (such as deletion of an automatic renewal clause). These
decisions are made on a case-by-case basis and depend primarily
[[Page 67925]]
on the nature and degree of performance. More specifically, they depend
on the--
+ Relative overall performance compared to other contractors;
+ Number of criteria in which deficient performance occurs;
+ Extent of each deficiency;
+ Relative significance of the requirement for which deficient
performance occurs within the overall evaluation program; and
+ Efforts to improve program quality, service, and efficiency.
Deciding the assignment or reassignment of providers and
designation of regional or national intermediaries for classes of
providers.
We make individual contract action decisions after considering
these factors in terms of their relative significance and impact on the
effective and efficient administration of the Medicare program.
In addition, if the cost incurred by the intermediary or carrier to
meet its contractual requirements exceeds the amount which the
Secretary finds to be reasonable and adequate to meet the cost which
must be incurred by an efficiently and economically operated
intermediary or carrier, such high costs may also be grounds for
adverse action.
VII. Response to Public Comments
Because of the large number of items of correspondence we normally
receive on Federal Register documents published for comment, we are
unable to acknowledge or respond to them individually. We will consider
all comments we receive by the date and time specified in the DATES
section of this preamble, and, if we proceed with a subsequent
document, we will respond to the comments in the preamble of that
document.
In accordance with the provisions of Executive Order 12866, this
notice was reviewed by the Office of Management and Budget.
We have reviewed this notice under the threshold criteria of
Executive Order 13132 of August 4, 1999, Federalism, published in the
Federal Register on August 10, 1999 (64 FR 43255). The Executive Order
is effective November 2, 1999, which is 90 days after the date of this
Order. We have determined that the notice does not significantly affect
the rights, roles, and responsibilities of States.
Section 202 of the Unfunded Mandates Reform Act of 1995 requires
that agencies assess anticipated costs and benefits before issuing any
rule that may result in an expenditure by State, local, or tribal
governments, in the aggregate, or by the private sector, of $100
million in any one year. This notice will not have an effect on the
governments mentioned, and the private sector costs will not be greater
than the $100 million threshold.
(Catalog of Federal Domestic Assistance Program No. 93.773,
Medicare--Hospital Insurance, and Program No. 93.774, Medicare--
Supplementary Medical Insurance Program)
Dated: October 6, 1999.
Michael M. Hash,
Deputy Administrator, Health Care Financing Administration.
[FR Doc. 99-31361 Filed 12-2-99; 8:45 am]
BILLING CODE 4120-01-P