Medicaid, CHIP Get a PERM

The Centers for Medicare & Medicaid Services (CMS) is beginning the 2011 Payment Error Rate Measurement  (PERM) review, which will cover all Texas Medicaid and Children's Health Insurance Program (CHIP) claims paid between Oct. 1, 2010, and Sept. 30, 2011. PERM measures the accuracy of payments to comply with the federal Improper Payments Information Act of 2002.

Physicians in state health care programs must participate in the PERM review and submit medical record documentation to support payments for any claims chosen for review. Auditors will randomly select and review claims. The primary CMS contractors are The Lewin Group and A+ Government Solutions, Inc. Physicians will have 75 calendar days to submit requested medical records to the contractor requesting the records and to the Texas Health and Human Services Commission (HHSC). It is very important that physicians respond to the PERM medical record request. If a physician fails to respond or fails to produce complete and correct documentation, it will trigger a PERM "exception," and the physician will be required to reimburse the total amount paid.

If a practice does not provide documentation or provides insufficient documentation, then under the PERM rules the claim will be considered paid in error and the state will recover the claim. At that point, physicians will have normal appeal rights with the state. States are "graded" on their errors rates by CMS. States with high error rates must submit corrective action plans, and CMS will recover overpaid funds from states.

HHSC urges physicians to monitor the PERM website  for updates as they become available.

For more information, call the Texas Medicaid & Healthcare Partnership Contact Center at (800) 925-9126.

Action, Sept. 16, 2011