Castle Rock Medical Group (CRMG) professionals have assisted individual physicians, multi-specialty practices and physical medicine providers facing extensive and far reaching Program Safeguard Contractor (PSC) audits.

To date, our industry-leading clinical, compliance and legal professionals have worked with providers facing extrapolated PSC repayments ranging between $48,000 to $2.1M.  Specifically, CRMG has assisted providers with evaluating PSC medical review and coding outcomes, PSC audit extrapolation, the filing of PSC appeals (or ZPIC appeals) and the mitigation of potential CMS fraud implications.

CMS Program Safeguard Contractors (PSC Audits / ZPIC Audits)

While the Medicare Recovery Audits (RAC Audits) program continues to focus the majority of efforts toward hospital adoption of CMS evidence-based coverage policies and site-of-service issues, CMS has launched another major initiative to directly challenge physician and physical medicine providers.  Although the program - Medicare Program Safeguard Contractors (PSC) - was not officially rolled out with an emphasis on physician billing and physical therapy claims submission, that is exactly where the program is currently focusing efforts.

Program Safeguard Contractors are organizations hired indirectly (or in connection with other CMS affiliated contractors) by CMS to perform a wide range of medical review, data analysis and Medicare evidence-based policy auditing activities.  While PSC audits are similar in many ways to other CMS audits currently being performed nationwide they do differ in one very important aspect – potential Medicare fraud implications.  Of all the current CMS audit initiatives – RAC audits, MIC audits, etc. – it is vital that providers facing PSC audits or ZPIC audits immediately and effectively address targeted audit issues. 

___________________________________________________________________

PSC Audits / ZPIC Audits - Primary CMS Focus Areas

Prior to the 1996 enactment of the Health Insurance Portability and Accountability Act (HIPAA), Medicare program safeguard activities were funded from the contracted fiscal intermediary’s general program management budget.  However, HIPAA revised the Social Security Act and established the Medicare Integrity Program - accelerating today’s focus on Medicare fraud, abuse and enforcement of CMS evidence-based coverage policies.

The Medicare Integrity Program’s (MIP) primary purpose is to deter fraud and abuse in the Medicare program by giving CMS authority to enter into contracts with outside entities and insure the “integrity” of the Medicare program.  In 1999, the Centers for Medicare & Medicaid Services (CMS) developed the PSC program to support the MIP, stop Medicare fraud and facilitate provider adherence to codified CMS payment criteria, Conditions of Participation and applicable judicial rulings.

PSCs (much like their RAC auditor counterparts) have a contracted Statement of Work (SOW) that encompasses all of the fundamental activities required for CMS program safeguard activities.  Basically, a PSC (or now referred to as a Zone Program Integrity Contractor – ZPIC) is generally responsible for one or more of the following CMS focus areas - (1) pre or post pay medical review of claims, (2) data analysis, (3) benefit integrity and/or fraud detection, (4) cost report audits and (5) provider education.

At the highest level, CMS considers an individual PSC (or ZPIC) as being responsible for detecting, deterring and even preventing Medicare fraud and abuse.  In this capacity, the PSC or ZPIC is directly responsible for operating areas such as investigation, case development, administrative solutions and referral to law enforcement. 

With the establishment of PSCs / ZPICs, fiscal intermediaries and Medicare administrative contractors typically have some or all of their program safeguard duties removed from the scope of their responsibility.  Step-by-step, CMS appears to be developing a more concentrated functional contracting focus for specific areas such are benefit integrity and claims processing activities.

PSC Audits / ZPIC Audits - CMS Medical Review Process

The CMS Medical Review (MR) program is designed to promote a structured approach in the interpretation and implementation of Medicare policy. The ultimate goal of the MR program is to identify and reduce Medicare program vulnerabilities (areas of potential fraud or abuse) relating to coverage and by taking the necessary action to prevent or address these areas.

The CMS’ national objectives and goals as they relate to medical review are as follows: 1) Increase the effectiveness of medical review payment safeguard activities; 2) Exercise accurate and defensible decision making on medical review of claims; and 3) Collaborate with other internal components and external entities to ensure correct claims payment, and to address situations of Medicare fraud, waste, and abuse.

In order to identify and challenge perceived fraud & abuse issues, Medicare PSC and ZPIC audits are based upon a combination of claims data from multiple sources (fiscal intermediary, regional home health intermediary, carrier, and durable medical equipment regional carrier data).  By combining data that originates from a full range of CMS contractors, the Medicare PSC / ZPIC contractor creates a complete profile of the beneficiary’s claim history regardless of where the claim was processed.

Although Quality Improvement Organizations (QIOs) continue to perform reviews related to quality of care and expedited determinations, they no longer perform the majority of utilization reviews for acute PPS hospitals or LTCH claims. The review of acute PPS hospitals and LTCH claims is now the responsibility of other CMS program contractors including: Carriers, Fiscal Intermediaries (FIs), Program Safeguard Contractors (PSCs), Zone Program Integrity Contractors (ZPICs) and Medicare Administrative Contractors (MACs).

While not all contractors perform all Medical Review functions, MR functions may include: analyze data, write local coverage determinations (LCD), review claims and educate providers.  Specific efforts may include: