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DEPARTMENT OF HEALTH CARE FINANCE
NOTICE OF PROPOSED RULEMAKING
The Director of the Department of Health Care Finance (DHCF), pursuant to the authority set forth in An Act to enable the District of Columbia to receive federal financial assistance under Title XIX of the Social Security Act for a medical assistance program, and for other purposes, approved December 27, 1967 (81 Stat. 774; D.C. Official Code §1-307.02), and the Department of Health Care Finance Establishment Act of 2007, effective February 27, 2008 (D.C. Law 17-109; D.C. Official Code § 7-771.05(6)), hereby gives notice of the intent to adopt a new section 965 of Chapter 9 of Title 29 of the District of Columbia Municipal Regulations (DCMR), to be entitled “Medicaid Utilization and Review”.
DHCF processed more than ten million claims for reimbursement for services rendered by District of Columbia Medicaid providers. In Fiscal Year 2009, payment for these claims represented more than one billion dollars. Federal rules require DHCF to review these claims to ensure that they were not paid in error and that no fraudulent claims were paid. DHCF employs strategies to efficiently review as many claims as possible and recover payments made in error. One strategy is to select a representative sample of claims for the period under review using a statistically valid sampling method. The error rate found in the sample will be applied to the entire group of claims during the audit period to determine the amount of the overpayment which may be recovered by DHCF. This process of applying the error rate from a statistically valid sample to the larger group from which the sample is selected is known as extrapolation. Most state Medicaid agencies use sampling and extrapolation to review claims and determine the amount of overpayment due to the state. District rules currently authorize the use of sampling and extrapolation for several types of services. The Fiscal Year 2010 Budget Support Act of 2009 (D.C. Act 18-255) requires DHCF to expand sampling and extrapolation methods for all services. These proposed rules therefore will require the use of sampling and extrapolation for all services that are audited by DHCF and provided under the Medicaid program.
The Director also gives notice of the intent to take final rulemaking action to adopt these proposed rules no less than thirty (30) days after the date of publication of this notice in the D.C. Register.
A new section 965 (Medicaid Utilization and Review) is added to Chapter 9 of Title 29 DCMR to read as follows:
965 MEDICAID UTILIZATION AND REVIEW
965.1 The Department of Health Care Finance (DHCF) shall perform audits and reviews to ensure that Medicaid payments are consistent with efficiency, economy and quality of care and made in accordance with federal and District rules governing Medicaid.
965.2 The audit and review process shall be routinely conducted by DHCF to determine, by statistically valid scientific sampling, the appropriateness of services rendered and billed to Medicaid.
965.3 Each provider shall allow access to relevant records and program documentation during an on-site audit or review by representatives of DHCF, other District of
Columbia government agencies, the United States Department of Health and Human Services (HHS) and other federal agencies.
965.4 If DHCF denies a claim, DHCF shall recoup, by the most expeditious means available, those monies erroneously paid to the provider for denied claims, following the period of administrative review as set forth in section 965.10.
965.5 The recoupment amounts for denied claims shall be determined by the following formula: A fraction shall be calculated with the numerator consisting of the number of denied paid claims resulting from the audited sample. The denominator shall be the total number of paid claims from the audit sample. This fraction shall be multiplied by the total dollars paid by DHCF to the provider during the audit period. The resulting amount shall be the amount to be recouped. For example, if a provider received Medicaid reimbursement of ten thousand dollars ($10,000) during the audit period, and during a review of the claims from the audited sample ten (10) claims out of one hundred (100) claims are denied, then ten percent (10%) of the amount reimbursed by Medicaid during the audit period, or one thousand dollars ($1000) would be recouped.
965.6 DHCF shall issue a Notice of Recoupment which sets forth the reasons for the recoupment, including the specific reference to the particular sections of the statute, rules, or provider agreement which authorize the denial of each claim, the amount to be recouped, and the procedures for requesting an administrative review.
965.7 The provider shall have sixty (60) days after the date DHCF issues the Notice of Recoupment to request an administrative review of the Notice of Recoupment. The request for administrative review shall be in writing and shall be submitted to DHCF staff as identified in the Notice of Recoupment.
965.8 The request for administrative review shall include a specific description of each item requested to be reviewed, the reason for the request for review, the relief requested, and documentation in support of the relief requested.
965.9 DHCF shall transmit to the provider a written determination approving or denying each item requested to be reviewed no later than one hundred and twenty (120) days after the date of the written request for administrative review.
965.10 The provider may appeal the written determination described in section 965.9 within forty-five (45) days of its receipt by filing a written notice of appeal with the District’s Office of Administrative Hearings, 825 North Capitol Street, N.E., Suite 4150, Washington, DC 20002.
965.11 The filing of an appeal with the Office of Administrative Hearings shall not stay any action to recover recoupment amounts from the provider.
965.99 DEFINITIONS
When used in this section, the following terms and phrases shall have the meanings ascribed:
Department of Health Care Finance (DHCF) – the executive department responsible for administering the Medicaid program within the District of Columbia effective October 1, 2008.
Overpayment – a payment or portion of a payment made to a Medicaid provider in excess of the payment to which the provider was entitled under the District of Columbia or federal laws and regulations governing the Medicaid program.
Provider - an individual or entity enrolled in the Medicaid program furnishing
services pursuant to a Medicaid provider agreement.
Statistically valid scientific sampling- the collection of data using generally accepted sampling methods.
Persons desiring to comment on these proposed rules should submit comments in writing within thirty (30) days after publication of this notice in the D.C. Register to Dr. Julie Hudman, Director, the Department of Health Care Finance, 825 North Capitol Street, N.E., 5th Floor, Washington, D.C. 20002. Copies of these proposed rules may be obtained between 8:30 a.m. and 5:00 p.m., Monday through Friday, excluding holidays, at the address stated above.
