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Medicaid Acronym of the Day – PERM

Payment Error Rate Measurement Program –

The Improper Payments Information Act (IPIA) of 2002 (amended in 2010 by the Improper Payments Elimination and Recovery Act or IPERA) requires the heads of Federal agencies to annually review programs they administer and identify those that may be susceptible to significant improper payments, to estimate the amount of improper payments, to submit those estimates to Congress, and to submit a report on actions the agency is taking to reduce the improper payments. The Office of Management and Budget (OMB) has identified Medicaid and the Children’s Health Insurance Program (CHIP) as programs at risk for significant improper payments. As a result, CMS developed the Payment Error Rate Measurement (PERM) program to comply with the IPIA and related guidance issued by OMB.

The PERM program measures improper payments in Medicaid and CHIP and produces error rates for each program. The error rates are based on reviews of the fee-for-service (FFS), managed care, and eligibility components of Medicaid and CHIP in the fiscal year (FY) under review. It is important to note the error rate is not a “fraud rate” but simply a measurement of payments made that did not meet statutory, regulatory or administrative requirements. FY 2008 was the first year in which CMS reported error rates for each component of the PERM program.

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Medicaid Acronym of the Day – OMB

The Office of Management and Budget (OMB) is the largest office within the Executive Office of the President of the United States (EOP). OMB’s most prominent function is to produce the President’s Budget, but OMB also measures the quality of agency programs, policies, and procedures to see if they comply with the president’s policies and coordinates inter-agency policy initiatives. OMB prepares the President’s budget proposal to Congress and supervises the administration of the executive branch agencies. OMB evaluates the effectiveness of agency programs, policies, and procedures, assesses competing funding demands among agencies, and sets funding priorities. OMB ensures that agency reports, rules, testimony, and proposed legislation are consistent with the president’s budget and with administration policies.

OMB also oversees and coordinates the administration’s procurement, financial management, information, and regulatory policies. In each of these areas, OMB’s role is to help improve administrative management, to develop better performance measures and coordinating mechanisms, and to reduce any unnecessary burdens on the public.

OMB’s critical missions are:

Budget development and execution is a prominent government-wide process managed from the Executive Office of the President (EOP) and a device by which a president implements his policies, priorities, and actions in everything from the Department of Defense to NASA.
OMB manages other agencies’ financials, paperwork, and IT.

Further reading

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Medicaid Acronym of the Day – NPI

A National Provider Identifier or NPI is a unique 10-digit identification number issued to health care providers in the United States by the Centers for Medicare and Medicaid Services (CMS). The NPI has replaced the unique physician identification number (UPIN) as the required identifier for Medicare services, and is used by other payers, including commercial healthcare insurers. The transition to the NPI was mandated as part of the Administrative Simplifications portion of the Health Insurance Portability and Accountability Act of 1996 (HIPAA), and CMS began issuing NPIs in October 2006.[1] HIPAA covered entities such as providers completing electronic transactions, healthcare clearinghouses, and large health plans were required by regulation to use only the NPI to identify covered healthcare providers by May 23, 2007. CMS subsequently announced that as of May 23, 2008, CMS will not impose penalties on covered entities that deploy contingency plans to facilitate the compliance of their trading partners (e.g., those healthcare providers who bill them). The posted guidance document can be used by covered entities to design and implement a contingency plan. Details are contained in a CMS document entitled, “Guidance on Compliance with the HIPAA National Provider Identifier (NPI) Rule.” Small health plans have one additional year to comply.

All individual HIPAA covered healthcare providers (physicians, pharmacists, physician assistants, midwives, nurse practitioners, nurse anesthetists, dentists, denturists, chiropractors, clinical social workers, professional counselors, physical therapists, occupational therapists, pharmacy technicians, athletic trainers etc.) or organizations (hospitals, home health care agencies, nursing homes, residential treatment centers, group practices, laboratories, pharmacies, medical equipment companies, etc.) must obtain an NPI for use in all HIPAA standard transactions, even if a billing agency prepares the transaction. Once assigned, a provider’s NPI is permanent and remains with the provider regardless of job or location changes.

Other health industry workers, such as admissions and medical billing personnel, housekeeping staff, and orderlies, who provide support services but not health care, are not required to obtain the NPI.


Further reading

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Medicaid Acronym of the Day – NPPES

National Plan and Provider Enumeration System –

The NPI is the standard for a unique identifier for health care providers for use in the health care system. NPPES is the application that health care providers must use to be awarded an NPI number.

Within the NPPES, there are two types of providers:
• Type 1 Providers – Health care providers who are individuals, including physicians, dentists, and all sole proprietors (An individual is eligible for only one NPI.)
• Type 2 providers – Health care providers who are organizations, including physician groups, hospitals, nursing homes, and the corporation formed when an individual incorporates him/herself.

Further reading

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Medicaid Acronym of the Day – NFLOC

Nursing facility (NF) level of care (LOC) is one of two eligibility components (the other is financial eligibility) for Medicaid reimbursement of NF services, as well as home and community based services (HCBS) offered as an alternative to people who would otherwise qualify to receive NF care.
Each State sets its own NF LOC criteria. Approval by the Centers for Medicare and Medicaid Services (CMS) is not required.

Generally, LOC determinations include either an assessment of certain functional needs—the need for assistance with Activities of Daily Living (ADLs); an assessment of certain clinical needs; or both.

Activities of Daily Living (ADLs) consist of self-care tasks that enable a person to live independently in his own home such as:
• Personal hygiene and grooming;
• Dressing and undressing;
• Self feeding;
• Functional transfers (getting into and out of bed or wheelchair, getting onto or off toilet, etc.);
• Bowel and bladder management; and
• Ambulation (walking without use of an assistive device (walker, cane, or crutches) or using a

LOC determinations may also include consideration of other factors which, while not ADLs per se, nonetheless impact a person’s ability to live safely and independently in the community, such as:
• Communication;
• Cognitive status;
• Behavior; or
• The ability to self-administer medications.

And finally, LOC determinations may take into consideration the applicant’s medical or clinical needs such as:
• The need for skilled nursing or rehabilitative care.

The ADL and clinical needs assessed for NF LOC vary by state.

Further reading

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Medicaid Acronym of the Day – NDC

The National Drug Code (NDC) is a unique product identifier used in the United States for drugs intended for human use. The Drug Listing Act of 1972[1] requires registered drug establishments to provide the Food and Drug Administration (FDA) with a current list of all drugs manufactured, prepared, propagated, compounded, or processed by it for commercial distribution. Drug products are identified and reported using the NDC.

There are several alternative drug classification systems in addition to NDC that are also commonly used when analyzing drug data, such as Generic Product Identifier (GPI).

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Medicaid Acronym of the Day – NCQA

The National Committee for Quality Assurance is a private, 501(c)(3) not-for-profit organization dedicated to improving health care quality. Since its founding in 1990, NCQA has been a central figure in driving improvement throughout the health care system, helping to elevate the issue of health care quality to the top of the national agenda.

The NCQA seal is a widely recognized symbol of quality. Organizations incorporating the seal into advertising and marketing materials must first pass a rigorous, comprehensive review and must annually report on their performance. For consumers and employers, the seal is a reliable indicator that an organization is well-managed and delivers high quality care and service.

NCQA has helped to build consensus around important health care quality issues by working with large employers, policymakers, doctors, patients and health plans to decide what’s important, how to measure it, and how to promote improvement. That consensus is invaluable — transforming our health care system requires the collected will and resources of all these constituencies and more.

NCQA’s programs and services reflect a straightforward formula for improvement: Measure. Analyze. Improve. Repeat. NCQA makes this process possible in health care by developing quality standards and performance measures for a broad range of health care entities. These measures and standards are the tools that organizations and individuals can use to identify opportunities for improvement. The annual reporting of performance against such measures has become a focal point for the media, consumers, and health plans, which use these results to set their improvement agendas for the following year.

NCQA’s contribution to the health care system is regularly measured in the form of statistics that track the quality of care delivered by the nation’s health plans. Every year for the past five years, these numbers have improved; health care protocols have been refined, doctors have learned new ways to practice, and patients have become more engaged in their care. Those improvements in quality care translate into lives saved, illnesses avoided and costs reduced. For instance, for every additional person who receives beta blockers after a heart attack, chances of suffering a second, perhaps fatal, heart attack are reduced by up to 40%.

NCQA consistently raises the bar. Accredited health plans today face a rigorous set of more than 60 standards and must report on their performance in more than 40 areas in order to earn NCQA’s seal of approval. And even more stringent standards are being developed today. These standards will promote the adoption of strategies that we believe will improve care, enhance service and reduce costs, such as paying providers based on performance, leveraging the Web to give consumers more information, disease management and physician-level measurement.

Health plans in every state, the District of Columbia and Puerto Rico are NCQA Accredited. These plans cover 109 million Americans or 70.5 percent of all Americans enrolled in health plans.

Further reading

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Medicaid Acronym of the Day – NVSS

The National Vital Statistics System (NVSS) collects official vital statistics data based on the collection and registration of birth and death events at the state and local levels. NCHS works in partnership with the vital registration systems in each jurisdiction to produce critical information on such topics as teenage births and birth rates, prenatal care and birth weight, risk factors for adverse pregnancy outcomes, infant mortality rates, leading causes of death, and life expectancy.

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Medicaid Acronym of the Day – NCHS

The National Center for Health Statistics (NCHS) is a principal agency of the U.S. Federal Statistical System which provides statistical information to guide actions and policies to improve the health of the American people.

NCHS is housed within the Centers for Disease Control and Prevention (CDC), which is part of the United States Department of Health and Human Services (HHS). It is headquartered at University Town Center in Hyattsville, Maryland, just outside Washington, D.C. In 1960, the National Office of Vital Statistics and the National Health Survey merged to form the National Center for Health Statistics (NCHS). NCHS is one of 13 principal statistical agencies in the federal government. The Center has been located in a number of organizations within the Department of Health and Human Services (HHS), and since 1987 has been part of the Centers for Disease Control and Prevention (CDC).

NCHS collects data with surveys, from other agencies and U.S. states, from administrative sources, and from partnerships with private health partners. NCHS collects data from birth and death records, medical records, interview surveys, and through direct physical examinations and laboratory testing. These diverse sources give perspectives to help understand the U.S. population’s health, health outcomes, and influences on health.

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Medicaid Acronym of the Day – NCCI

The National Correct Coding Initiative (NCCI) is a CMS program designed to prevent improper payment of procedures that should not be submitted together. There are two categories of edits:

Physician Edits: these code pair edits apply to physicians, non-physician practitioners, and Ambulatory Surgery Centers
Hospital Outpatient Prospective Payment System Edits (Outpatient Edits): these edits apply to the following types of bills: Hospitals (12X and 13X), Skilled Nursing Facilities (22X and 23X), Home Health Agencies Part B (34X), Outpatient Physical Therapy and Speech Language Pathology Providers (74X), and Comprehensive Outpatient Rehabilitation Facilities (75X).

Both the physician and outpatient edits can be split into two further code pair categories:

Column1/Column2 Code Pairs: these code pairs were created to identify unbundled services. The name is derived from the fact that the code pairs are separated into two columns; Column 1 contains the most comprehensive code, and Column 2 contains component services already covered by that more-comprehensive code.

These code pairs are further categorized into two sets:

Modifier: the appropriate use of a modifier allows these code pair to be reported together. In most cases, the -59 modifier is used, although there are other acceptable modifiers. These modifiers must be supported by documentation in the medical record.

No Modifiers: these code pairs should never be reported together, regardless of modifiers.

Mutually Exclusive Code Pairs (MEC): these code pairs should not be reported together because they are mutually exclusive of each other.
NCCI code pairs must match on member, provider, and date of service. CMS maintains tables of code pair edits and updates these tables on a quarterly basis.

Further reading