Attention All Providers: Payment Error Rate Measurement (PERM) Audit

Attention All Providers: Payment Error Rate Measurement (PERM) Audit

Current PERM Audit

The State of Maine is currently in the process of a federally mandated PERM audit for Reporting Year 2021. This audit covers randomly selected paid claims with a payment date from July 1, 2019 through June 30, 2020. Due to the random sampling of claims, all providers should be prepared to send requested medical records to support claims that were or will be paid during this time period.

Required Medical Records

In the coming months, you may receive a request for medical records for a specific claim from NCI, Inc. Please be advised that this is a legitimate request and is part of the federally mandated PERM audit. NCI, Inc. may first contact a provider by telephone to get the correct contact information, after which they will send their request for medical records. The letter request for medical records will list the name of the contracted agency conducting the PERM audit. Please note, the PERM auditor is NCI, Inc., not CNI Advantage.

NCI, Inc. has contracted with the Centers for Medicare and Medicaid Services (CMS) to conduct the audit of MaineCare claims. Per MaineCare policy, providers who are contacted by NCI, Inc. for the purpose of the PERM audit are required to respond to their requests for information and provide the necessary documentation so they can conduct their reviews. Please see MaineCare Benefits Manual - Chapter 1, Section 1.03 for more information about this requirement. 

Financial Impact of Errors and Lack of Documentation

It is critical that providers respond to requests for documentation in a timely fashion. Records that are incomplete, submitted late, or not submitted at all will result in an automatic error and will be considered an improper payment. The State will have to reimburse the federal government for all improper payments and may seek reimbursement from providers who did not comply with federal law.

Resources for the Documentation Records Audit

CMS has produced a video titled “PERM: Responding to Medical Records/Documentation Requests” that providers may find useful in preparing their records for audit.

PERM Description and Federal Requirements

PERM measures improper payments in Medicaid and the State Children’s Health Insurance Program (CHIP) and produces state- and national-level error rates for each program as required by the Improper Payments Information Act (IPIA) of 2002 (amended in 2010 by the Improper Payments Elimination and Recovery Improvement Act or IPERA, and the Improper Payments Elimination and Recovery Improvement Act of 2012 or IPERIA). See the CMS PERM Laws and Regulations webpage for more details. CMS also has a dedicated page for providers, complete with a link to Frequently Asked Questions (FAQs).

Provider Billing Reminders

As a MaineCare provider, it is your responsibility to make sure that all claims sent to MaineCare are true and accurate. For each claim submitted, you must be sure to include the correct member name, member status, date of service, bill type, billed units, and charges and be sure to use the correct procedure codes. Claims should also include modifiers, medical assessments, daily shift notes, physician’s orders, home support provider census sheets, pre-authorizations, RUGs, admission dates, etc., if applicable.

The MaineCare Benefits Manual, Chapter 1, Section 1.03 states that all providers must “Maintain and retain contemporaneous financial, provider, and professional records sufficient to fully and accurately document the nature, scope and details of the health care and/or related services or products provided to each individual MaineCare member” and that these records are kept “for a period of not less than five (5) years from the date of service or longer if necessary to meet other statutory requirements. If an audit is initiated within the required retention period, the records must be retained until the audit is completed and a settlement has been made.”

Failure for a provider to return the requested documentation in the proper format within the requested timeframe could result in recoupment of MaineCare payment on that claim.

The most common errors found in our last PERM cycle were for missing documentation. Providers did not submit the following:

• Progress notes applicable to the sampled Date Of Service (DOS) – Be sure to keep accurate progress notes for each DOS.
• The service plan – Be sure to document the service plan.
• Physician’s order for the sampled service – Be sure that the physician’s orders are documented to support the service provided.
• Required start and stop times for all sampled DOS – Be sure to record the start and stop times for all services that require documentation of the start and stop times.
• Multiple documents that are required to support payment – Be sure to keep accurate records that support the claim.
• Daily documentation of specific tasks performed on the sampled DOS – Be sure to keep accurate records of specific tasks performed for each service.
• Test results – Be sure to keep test results in the record.
• Required provider signature and/or credentials– Be sure the provider signs the orders and includes their credentials.

PERM Webpage

Go to the PERM Audit webpage for more information about  federal requirements, common errors found in previous cycles, Frequently Asked Questions (FAQs), and Record Request Guidelines.

Contact Information

• For questions about medical records requests, including questions on the terminology used in some of the communications from NCI, Inc., please contact the NCI, Inc. Medical Records Manager. The contact information is printed on the bottom of the documentation request letter that you received.
• You can email CMS with general questions on the federal PERM program and provider specific at PERMProviders@cms.hhs.gov. Please DO NOT send medical records to this contact.
• Please contact Kealoha Rosso by phone at (207) 624-6929 or email at kealoha.e.rosso@maine.gov for State of Maine-specific questions. Please DO NOT send medical records to this contact.