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					Volume 2, Issue 14                                                                   March 30, 2011


AFFORDABLE CARE ACT

   On March 21, Virginia Attorney General Kenneth Cuccinelli filed a brief in the U.S. Court of Appeals
   4th Circuit arguing that the entire Affordable Care Act statute should be ruled unconstitutional.
   Cuccinelli also asked the Supreme Court to bypass the appeals process and hear the case
   immediately. The American Center for Law and Justice also filed a brief with the 4 th Circuit Court of
   Appeals on March 21 on behalf of the Virginia suit asking the court to declare the entire law
   unconstitutional. House Speaker John Boehner (R-Ohio) and House Majority Leader Eric Cantor (R-
   Va.) are two of the 49 congressional members represented by the ACLJ.

Centers for Disease Control and Prevention
Announcements
March 24

   As authorized through the Affordable Care Act (P.L. 111-148), the CDC announced a new
   competitive grant opportunity entitled “Capacity Building Assistance to Strengthen Public Health
   Infrastructure and Performance.” The overall goal of this grant is to support the provision of
   capacity building assistance to state, tribal, local and territorial health departments that ensures
   performance improvement and successful adoption of best or promising practices to address key
   areas of public health infrastructure investments. Grant amounts may range from $70,000 to
   $600,000. Applications are due by April 19, 2011, 5:00 p.m. ET. For more information, please visit
   http://www.grants.gov/search/search.do;jsessionid=7T4BNHjchGMHMv13LxLYfDlGbv1QSPkGph0bhl
   RQldg2FmSh5vQr!-1650214196?oppId=80533&mode=VIEW.

Centers for Medicare and Medicaid Services
Announcements
March 25

   The Center for Medicaid, CHIP and Survey & Certification issued an information bulletin providing
   operational policy clarifications around several provisions of the Children’s Health Insurance
   Program Reauthorization Act of 2009 and the ACA. They are as follows:

   (1) CHIPRA Performance Bonuses
       a. Eliminating the requirement for states to liberalize their asset test for all Medicaid categories
       for which being a child is a condition of eligibility (including the Section 1931 family coverage
       group). States will not be required to remove the asset test for the 1931 eligibility group
       pending the state can demonstrate that all children who are income eligible for Medicaid can be
       enrolled in one of the state’s eligibility categories that do not include an asset test, and will not
       be denied eligibility due to one.
       b. Eliminating requirement for states to liberalize the asset test for the medically needy
       eligibility group for children, children eligible under 1902(e)(3) and under Section
       1902(a)(10)(A)(ii)(XIX).

       *States that choose to liberalize the asset test by using self-declaration or administrative
       verification of assets should submit supporting documentation of this change with their FY
       2011 Performance Bonus Application, but a SPA is not required. States considering applying for
       a FY 2011 Performance Bonus are encouraged to contact Dena Greenblum of the Children and
       Adults Health Programs Group at (410) 786-8684 or via e-mail at
       CHIPRABonusPayments@cms.hhs.gov before April 1, 2011, to ensure that all documentation is
       in order.

   (2) Coverage of Freestanding Birth Centers
       As authorized through Section 2301 of the ACA, which ensures Medicaid coverage of care in
       freestanding birth centers, states will need to submit SPAs that specify coverage and separate
       reimbursement of these facility services and professional services in order to comply with this
       provision.

   (3) Dental Services in FQHCs
       A brief Q&A is provided on Section 501(d) of CHIPRA, adding Section 1902(a)(72) to the Social
       Security Act and Section 2107(e)(1)(B) to the Children’s Health Insurance Program, which
       mandates that states may not prevent a Federally Qualified Health Center from contracting with
       private practice dental providers. The Q&A focuses on the effects on state programs,
       implementation and role of the Health Resources and Services Administration as administrators
       of the FQHC program.

   (4) Model Interstate Coordination Process for Medicaid and CHIP
       As authorized through Section 213 of CHIPRA, CMS was charged with developing a model
       process designed to coordinate Medicaid and CHIP enrollment, retention and access to care for
       children who frequently change their state of residence. In July 2010, CMS released a proposed
       model and is seeking state feedback on its viability. The model proposes new host and home
       state eligibility and enrollment activities; a 100 percent Federal Financial Participation
       reimbursement rate for services rendered under the outlined activities; and eligibility
       verification through enhanced data exchange methods.

   (5) Agency for Healthcare Research and Quality Grants to Further Children’s Quality Measurements
       AHRQ awarded $55 million cooperative grants to seven AHRQ-CMS CHIPRA Centers of
       Excellence in Pediatric Quality Measures on March 1, 2011, as required through CHIPRA’s
       Pediatric Quality Measures Program to develop quality core measures and make them
       applicable to Medicaid, CHIP, and other programs. Awardees are listed in the attached bulletin.

   For additional information, please see the attached Informational Bulletin.

   CMCS and the Center for Program Integrity issued an Informational Bulletin and a subsequent FAQ
   providing guidance on the final rule published on Feb. 2, 2011 on section 6402(h)(2) of the ACA,
   Suspension of Medicaid Payments Based Upon Pending Investigations of Credible Allegations of
   Fraud. The bulletin includes circumstantial examples of what constitutes “good cause” exceptions
   of states decision to terminate a whole payment suspension or partial suspension. The bulletin and
   FAQ are attached.

Federal Register
March 25

   (CMS-10384; CMS-10342; CMS-10338)
   (1) (CMS-10384/OCN: 0938-NEW): A new information collection, “Health Insurance Assistance
       Database” is being requested to create a system to collect, track and store consumer
       information in order to accomplish successful case management to ensure that information,
       coverage, and health care needs of consumers are addressed fairly and in a timely manner upon
   submission of consumer inquiries to CMS’ Center for Consumer Information and Insurance
   Oversight. For policy questions, contact Paul Tibbits at (301) 492-4229.

(2) (CMS-10342/OCN: 0938-1105): Extension of a currently approved collection, “Annual Limits
    Waiver Online Application Form,” which is a spreadsheet that applicants fill out per application
    (a mandatory component of each waiver application as mandated by section 2711(a)(2) of the
    Public Health Service Act, as amended by Section 1302(b) of the ACA). CMS will be updating the
    spreadsheet so that it contains a more detailed description of what values should be entered
    into each cell. For policy questions, contact Erika Kottenmeier at (301) 492-4170.

(3) (CMS-10338): Extension of a currently approved collection, “Affordable Care Act Internal Claims
    and Appeals and External Review Procedures for Non-grandfathered Group Health Plans and
    Issuers and Individual Market Issuers,” which, with respect to internal claims and appeals
    processes for group health coverage, PHS Act Section 2719 and paragraph (b)(2)(i) of the interim
    final regulations, provides that group health plans and health insurance issuers offering group
    health insurance coverage must comply with the internal claims and appeals processes set
    forth in 29 CFR 2560.503-1 (the DOL claims procedure regulation) and update such processes in
    accordance with standards established by the secretary of Labor in paragraph (b)(2)(ii) of the
    regulations. Paragraph (b)(3)(i) requires that issuers offering coverage in the individual health
    insurance market also comply with the DOL claims procedure regulation as updated by the
    secretary of HHS in Paragraph (b)(3)(ii) of the interim final regulations for their internal claims
    and appeals processes. The DOL claims procedure regulation requires plans to provide every
    claimant who is denied a claim with a written or electronic notice that contains the specific
    reasons for denial, a reference to the relevant plan provisions on which the denial is based, a
    description of any additional information necessary to perfect the claim, and a description of
    steps to be taken if the participant or beneficiary wishes to appeal the denial. Additionally,
    Paragraph (b)(3)(ii)(C) of the interim final regulations adds an additional requirement that non-
    grandfathered ERISA-covered group health plans provide to the claimant, free of charge, any
    new or additional evidence considered relied upon, or generated by the plan or issuer in
    connection with the claim. Also, PHS Act Section 2719 and these interim final regulations
    provide that group health plans and issuers offering group health insurance coverage must
    comply either with a state external review process or a federal review process. For policy
    questions, contact Tara Oakman at (301) 492-4253.

Comments for the above collections are to be submitted by May 24, 2011, via electronic submission
to http://www.regulations.gov or via mail to: CMS, Office of Strategic Operations and Regulatory
Affairs, Division of Regulations Development, Attention: Document Identifier/OMB Control
Number, Room C4-26-05, 7500 Security Blvd., Baltimore, MD 21244. To view these collection
requests/extensions, please visit http://edocket.access.gpo.gov/2011/2011-7104.htm.

(CMS-10373) New collection request, “Medical Loss Ratio Quarterly Reporting,” as mandated by
Section 2718 of the ACA. This new collection would be implementing regulations at 45 CFR Part
158 requiring a health insurance issuer offering group or individual health insurance coverage to
submit a report to the secretary concerning the amount the issuer spends each year on claims,
quality improvement expenses, non-claims costs, federal and state taxes, and licensing or
regulatory fees, and the amount of earned premium. For policies that have a total annual limit of
$250,000 or less (“mini-med plans”) and for policies that primarily cover employees working
outside the United States (“expatriate plans”), the IFR applies a special circumstance adjustment to
the MLR data for the 2011 MLR reporting year. In order to evaluate this special circumstance,
issuers that provide such policies are required to submit quarterly MLR data to the secretary for
the 2011 MLR reporting year. For policy questions, contact Carol Jimenez at (301) 492-4109.
Comments are to be submitted by April 25, 2011, and may be sent electronically at
http://www.regulations.gov; via mail to CMS, Office of Strategic Operations and Regulatory Affairs,
Division of Regulations Development, Attention: Document Identifier, Room C4-26-05, 7500
Security Blvd., Baltimore, MD 21244; or by fax to (202) 395-6974 or e-mail at
OIRA_submission@omb.eop.gov. To view this information request, please go to
http://edocket.access.gpo.gov/2011/2011-7106.htm.
   (CMS-10320/OMB: 0938-1086) Reinstatement of a previously approved collection, “Health Care
   Reform Insurance Web Portal Requirements 45 CFR 159,” which requires information to be
   collected from insurance issuers of major medical health insurance and process for display at
   http://www.healthcare.gov, as mandated by Sections 1103 and 10102 of the Affordable Care Act.
   CMS is mandating insurance issuers to verify and update their information for a June refresh of the
   web site. If an issuer has enhanced or modified its existing plans, created new plans, or deactivated
   plans, the organization would be required to update the information in the web portal. All
   comments are to be submitted by April 25, 2011, via electronic submission to
   http://www.regulations.gov; via fax or e-mail to OMB, Office of Information and Regulatory Affairs,
   Attention: CMS Desk Officer, (202) 395-6934 or OIRA_submission@omb.eop.gov; or via mail to CMS,
   Office of Strategic Operations and Regulatory Affairs, Division of Regulations Development,
   Attention: Document Identifier/OMB Control Number, Room C4-26-05, 7500 Security Blvd.,
   Baltimore, MD 21244. For more information, please go to http://edocket.access.gpo.gov/2011/2011-
   7095.htm.

   (CMS-10328; CMS-10319)
   (2) (CMS-10328/OMB: 0938-1106) Revision of a currently approved collection, “Medicare Self-
       Referral Disclosure Protocol” requiring the secretary to establish and post information on the
       CMS’ public internet web site concerning a self-referral disclosure protocol (SRDP) that sets
       forth a process for providers of services and suppliers to self-disclose actual or potential
       violations of Section 1877 of the ACA. CMS will then analyze the disclosed conduct to
       determine compliance with Section 1877 and the application of the exceptions to the physician
       self-referral prohibition. The secretary also has the authority under section 6409 (b) of the ACA,
       and subsequently delegated to CMS, to reduce the amount due and owing for violations. For
       policy questions, contact Ronke Fabayo at (410) 786-4460.

   (3) (CMS-10319/OMB: 0938-1085) Extension of an approved collection, “Pre-Existing Condition
       Insurance Plan Program Solicitation and Contractor’s Proposal Package,” of which CMS is
       requesting a three-year approval from OMB. This package renewal is being requested as a result
       of a possible transition in administration of the program from a federally run to a state-
       administered program. A state who originally decided to have HHS administer its state program
       may in the future notify HHS of its desire to administer the PCIP program. For policy questions,
       please contact Laura Dash at (301) 492-4296.

   *Comments for both proposed collections must be submitted no later than 5:00 p.m. on April 25,
   2011, and may be sent via fax or e-mail to OMB, Office of Information and Regulatory Affairs,
   Attention: CMS Desk Officer, fax (202) 395-6974 or e-mail OIRA_submission@omb.eop.gov. To view
   these proposed collections, please visit http://edocket.access.gpo.gov/2011/2011-7099.htm.

Health Resources and Services Administration
Meetings
March 28

   Per request from HRSA and the CDC, the Institute of Medicine’s Board on Population Health and
   Public Health Practice held a meeting examining ways to integrate primary care and public health
   resulting in the development of an evidence-based, integrated model and other recommendations
   helping to achieve successful linkages between the two. For more information, please visit
   http://www.iom.edu/Activities/PublicHealth/PrimaryCarePublicHealth.aspx.

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Administration for Children and Families
Federal Register
March 24

   (FR Doc. 2011-6991) The Office of Policy, Research and Evaluation announced an award of a
   cooperative agreement in the amount of $3,000 to the Congressional Hunger Center to work with
   ACF programs on addressing hunger and obesity issues for young children. For more information,
   please contact George Askew, Senior Policy Advisor for Early Childhood Health and Development,
   Office of the Deputy Assistant Secretary and Inter-Departmental Liaison for Early Childhood
   Development at (202) 401-1399.

Agency for Healthcare Research and Quality
Federal Register
March 25

  (FR Doc. 2011-6857) Notice of proposed collection project request to OMB and to extension of the
  comment request period on the “Connecting Primary Care Practices with Hard-to-Reach Adolescent
  Populations” project. The project’s goal is to improve the quality of adolescent health care by
  addressing suboptimal adolescent care with respect to health risk behaviors that can have serious
  health consequences. Comments are to be received by April 25, 2011, and may be faxed to (202)
  395-6974 (attention: AHRQ’s desk officer) or e-mailed to OIRA_submission@omb.eop.gov (attention:
  AHRQ’s desk officer). For more information, please contact Doris Lefkowitz, AHRQ Reports
  Clearance Officer, at (301) 427-1477 or at doris.lefkowitz@AHRQ.hhs.gov. This notice is available at
  http://edocket.access.gpo.gov/2011/2011-6857.htm.

  (FR Doc. 2011-6852) Notice of a public meeting to discuss the technical specifications for common
  formats, inclusive of the Hospital Common Formats and the Skilled Nursing Facility Common
  Formats, for patient safety data collection and event reporting. The purpose of the meeting is to
  provide patient safety organizations and software developers with an interactive forum to provide
  input on these technical specifications. The meeting will be held from 10:00 a.m.–3:30 p.m. on May
  11, 2011, at the Hilton Washington DC/Rockville Meeting Center, 1750 Rockville Pike, Rockville, MD
  20852. For more information, please contact Susan Grinder, Center for Quality Improvement and
  Patient Safety, AHRQ at (301) 427-1111 or at PSO@ahrq.hss.gov. This notice is available at
  http://edocket.access.gpo.gov/2011/2011-6852.htm.

Center for Faith-Based and Neighborhood Partnerships (The Partnership Center)
Announcements
March 25

   First Lady Michelle Obama formally launched the Let’s Move! Faith and Communities initiative
   aimed at ending childhood obesity within a generation in February 2011. The Partnership Center
   announced the Lets Move! Toolkit for Faith-based and Neighborhood Organizations, and a one-page
   fact sheet is now available at http://www.hhs.gov/fbci/.

Centers for Medicare and Medicaid Services
Announcements
March 25

   CMS announced the 10-month time period remaining for providers to transition their electronic
   health care transactions to the ICD-10 codes (effective Jan. 1, 2012). The ICD-10 codes must be
   used on all HIPAA transactions, including outpatient claims with dates of services, and inpatient
   claims with dates of discharge on and after Oct. 1, 2013. Non-compliance may result in the
   rejection of claims and transactions and thus delaying reimbursements. For more information,
   please visit http://www.cms.gov/ICD10/.

March 23

   The Medicare and Medicaid Electronic Health Record Incentive Programs are holding two
   conference calls for eligible professionals and eligible hospitals about registration information. The
   first call is for EPs who want to participate in the Medicare EHR Incentive Program. This call will be
   held on Friday, April 1, 2011, from 1:30–3:30 p.m. ET. The second call is for eligible hospitals that
   would like to participate in the Medicare and/or Medicaid EHR Incentive Programs and will be held
   on Wednesday, April 6, 2011, from 1:30–3:30 p.m. ET. Presentation materials will be available at
   http://www.cms.gov/EHRIncentivePrograms/50_Spotlight.asp#TopOfPage prior to the calls.

Federal Register
March 25

   (CMS-370/-377/-378; CMS-10145; CMS-10362)
   (1) (CMS-370/-377/-378): Revision of a currently approved collection entitled, “Health Insurance
       Benefits Agreement (CMS-370), ASC Request for Certification or Update of Certification
       Information in the Medicare Program (CMS-377), and Ambulatory Surgical Center (ASC) Survey
       Report Form (CMS-378).” CMS-370 has not been revised; CMS-377 has been revised and will be
       used to collect facility-specific characteristics that facilitate CMS’ oversight of ASCs; and CMS-
       378 will be discontinued since it duplicates information collected by other means. For policy
       questions, please contact Gail Vong at (410) 786-0787.

   (2) (CMS-10145): Extension without change of a currently approved collection entitled, “Medicare
       Part B Drug and Biological Competitive Acquisition Program (CAP) and Supporting Regulations
       in 42 CFR Sections 414.906, 414.908, 414.910, 414.914, 414.916, and 414.917.”

   (3) (CMS-10362/OCN: 0938-NEW): New information collection request entitled, “Autism Spectrum
       Disorders (ASD): State of the States Services and Supports for People with ASD,” to be used to
       communicate information available ASD services to people with ASD and the public policy
       issues that affect people with ASD to key stakeholder audiences. For policy questions, contact
       Ellen Blackwell at (410) 786-4498.

   Comments for the above collections are to be submitted by May 24, 2011, via electronic submission
   to http://www.regulations.gov or via mail to: CMS, Office of Strategic Operations and Regulatory
   Affairs, Division of Regulations Development, Attention: Document Identifier/OMB Control
   Number, Room C4-26-05, 7500 Security Blvd., Baltimore, MD 21244. To view these collection
   requests/extensions, please visit http://edocket.access.gpo.gov/2011/2011-7104.htm.

   (CMS-4145-FN) Final notice announcing the decision to renew the Medicare Advantage Deeming
   Authority of the National Committee for Quality Assurance for Health Maintenance Organizations
   and Preferred Provider Organizations for a term of four years. The new term of approval began Oct.
   19, 2010, and ends Oct. 18, 2014. This notice is effective on April 25, 2011, and is available at
   http://edocket.access.gpo.gov/2011/2011-6222.htm. For more information, please contact Caroline
   Baker at (410) 786-0116.

March 23

   (CMS-6029-N) Notice announcing CY 2011 application fee of $505.00 for institutional Medicare
   providers and suppliers enrolling in, revalidating enrollment or adding a new practice location.
   Providers and suppliers are required to submit the 2011 fee with enrollment applications
   submitted on or after March 25, 2011, and on or before Dec. 31, 2011. Additionally, beginning
   March 25, 2011, prospective or re-enrolling Medicaid or CHIP providers must submit the
   application fee unless the provider is an individual practitioner or nonphysician practitioner; or if
   the provider is enrolled in Medicare, or the state Medicaid or CHIP plan and has paid the
   application fee to a Medicare contractor or another state. CMS will provide more information about
   how the fee can be submitted. This notice is effective March 23, 2011, and is available at
   http://edocket.access.gpo.gov/2011/2011-6813.htm.

Indian Health Service
Federal Register
March 23

   (FR Doc. 2011-6826) Notice of a Memorandum of Agreement between the IHS and the Department
   of Interior, originally signed in 2009, and also notice of an amendment to that MOA with language
   consistent with Section 703 of the Indian Health Care Improvement Act (IHCIA) by IHS. The
   purpose of amendment to the MOA is to advance the partnership with tribes and federal
   stakeholders on alcohol and substance abuse prevention and treatment by including coordination
   of data collection, resources and programs of the HIS, the Bureau of Indian Affairs, and the Bureau
   of Indian Education. The original MOA was effective on Dec. 12, 2009, and the amendment is
   effective March 1, 2011. For further information, please contact Dr. Rose Weahkee, Director of the
   Division of Behavioral Health, Office of Clinical and Preventive Services, IHS at (301) 443-2038. To
   view this notice, please visit http://edocket.access.gpo.gov/2011/2011-6826.htm.

Office of the National Coordinator for Health Information Technology
Announcement
March 25

   The ONC is seeking public comment on the Federal Health IT Strategic Plan: 2011-2015. Comments
   are to be submitted by April 22, 2011, at 11:59 p.m. ET. The plan and instructions on how to
   comment are available at
   http://healthit.hhs.gov/portal/server.pt?open=512&objID=1211&parentname=CommunityPage&pare
   ntid=2&mode=2.

OTHER FEDERAL ANNOUNCEMENTS

Department of Agriculture
Food and Nutrition Service
Federal Register
March 25

   (FR Doc. 2011-6948) Notice announcing USDA’s annual adjustments to the Income Eligibility
   Guidelines to be used in determining eligibility for free and reduced price meals and free milk for
   the period from July 1, 2011, through June 30, 2012. The guidelines are effective July 1, 2011. For
   more information, contact William Wagoner, Supervisory Program Analyst, School Programs
   Section, Child Nutrition Division, FNS at (703) 305-2590. This notice is available at
   http://edocket.access.gpo.gov/2011/2011-6948.htm.

March 24

   (FR Doc. 2011-6946) Notice issued by DOA adjusting the income eligibility guidelines to be used by
   state agencies in determining income eligibility for persons applying to participate in the Special
   Supplemental Nutrition Program for Women, Infants and Children. State agencies may coordinate
   implementation with the revised Medicaid guidelines but in no case may implementation take place
   later than July 1, 2011. State agencies that do not coordinate implementation with the revised
   Medicaid guidelines must implement the WIC income eligibility guidelines on July 1, 2011. For
   more information, contact Anne Bartholomew, Branch Chief, Policy Branch, Supplemental Food
   Programs Division, FNS, USDA at (703) 305-2746. To view this notice and the eligibility guidelines,
   please visit http://edocket.access.gpo.gov/2011/2011-6946.htm.

Equal Employment Opportunity Commission
Federal Register
March 25

   (29 CFR Part 1630): The EEOC issued its final regulations and accompanying interpretive guidance
   to implement the equal employment provision of the American with Disabilities Act, as amended
   by the Amendments Act. The Amendments Act’s purpose is to expand the definition of the term
   “disability” to include individuals with epilepsy, diabetes, HIV infection, cancer, multiple sclerosis,
   intellectual disabilities, major depression and bipolar disorder. To view the final rule, please visit
   http://edocket.access.gpo.gov/2011/2011-6056.htm.

Social Security Administration
Federal Register
March 24

   (20 CFR Part 404) Final rule making a technical correction to a cross-reference of the Special Sense
   and Speech body system for children that became outdated upon publication of revisions
   elsewhere in the Listing of Impairments in 2010. The final rule is available at
   http://edocket.access.gpo.gov/2011/2011-6983.htm. For more information, please contact Cheryl
   Williams, Office of Medical Listings Improvement, SSA at (410) 965-1020.

CONGRESSIONAL UPDATES

House
Hearings

Energy and Commerce Committee
http://energycommerce.house.gov/

   Subcommittee on Health
   March 30, 10:00 a.m. ET
   True Cost of PPACA: Effects on the Budget and Jobs

   Subcommittee on Oversight and Investigation
   April 1, 10:00 a.m. ET
   2123 Rayburn House Office Building
   The PPACA’s High Risk Pool Regime: High Cost, Low Participation
                        Frequently Asked Questions
     Section 6402(h) of the Patient Protection and Affordable Care Act
                                March 2011

Section 6402(h)(2) of the Affordable Care Act, Suspension of Medicaid Payments
Pending Investigation of Credible Allegations of Fraud amended section 1903(i)(2) of the
Social Security Act to provide that Federal financial participation (FFP) in the Medicaid
program shall not be made with respect to any amount expended for items or services
(other than an emergency item or service, not including items or services furnished in an
emergency room of a hospital) furnished by an individual or entity to whom a State has
failed to suspend payments under the plan during any period when there is pending an
investigation of a credible allegation of fraud against the individual or entity as
determined by the State, unless the State determines that good cause exists not to suspend
such payments. On February 2, 2011, CMS published its final rule implementing this
provision. See http://edocket.access.gpo.gov/2011/pdf/2011-1686.pdf.


Q.     What constitutes a “credible allegation of fraud”?

A.     In the final rule, CMS provides certain bounds around the definition of “credible
       allegation of fraud” at 42 C.F.R. § 455.2. Generally, a “credible allegation of
       fraud” may be an allegation that has been verified by a State and that has indicia
       of reliability that comes from any source. Further, CMS recognizes that different
       States may have different considerations in determining what may be a “credible
       allegation of fraud.” Accordingly, CMS believes States should have the
       flexibility to determine what constitutes a “credible allegation of fraud” consistent
       with individual State law. However, a credible allegation of fraud, for example,
       could be a complaint made by an employee of a physician alleging that the
       physician is engaged in fraudulent billing practices, i.e., the physician repeatedly
       bills for services at a higher level than is actually justified by the services
       rendered to beneficiaries. Upon State review of the physician’s billings, the State
       may determine that the allegation has indicia of reliability and is, in fact, credible.

Q.     What could be potential sources of credible allegations of fraud?

A.     A credible allegation of fraud may be an allegation from any source, including but
       not limited to: (1) Fraud hotline complaints; (2) Claims data mining; (3) Patterns
       identified through provider audits, civil false claims cases, and law enforcement
       investigations. We recognize that credible allegations may stem from a variety of
       sources.

Q.     What should a State do when it receives an allegation of fraud?

A.     A State must follow the requirements of 42 C.F.R. § 455.14 which describes
       preliminary investigations. States must also review all allegations, facts, and
       evidence carefully and act judiciously on a case-by-case basis. CMS recognizes
       that there may be mistaken or false reports of allegations of fraud. Due to the
       potential for false allegations, CMS encourages States to not solely rely on a
Frequently Asked Questions – Affordable Care Act Section 6402(h)(2)
March 2011


      singular allegation without considering the totality of the facts and circumstances
      surrounding any particular allegation or set of allegations.

Q.    Once a State verifies an allegation of fraud, what should it do next?

A.    A State is required to refer the suspected fraud to its Medicaid Fraud Control Unit
      or other law enforcement agency for further investigation in accordance with
      CMS’ performance standards for suspected fraud referrals
      (https://www.cms.gov/FraudAbuseforProfs/Downloads/fraudreferralperformances
      tandardsstateagencytomfcu.pdf). In addition, a State is required to suspend
      payments for such provider unless the State has “good cause” not to suspend
      payments and follow the procedures required to analyze and/or document such
      good cause.

Q.    If a MFCU declines to accept a referral from a State due to a lack of
      resources, but not because the MFCU thinks there is an insufficient credible
      allegation of fraud, what should a State do?

A.    A State may refer the matter to another law enforcement agency that has capacity
      to accept the referral from the State agency. If the second referral is made, the
      payment suspension should continue. If not, the suspension should be ended.

Q.    If a no law enforcement investigation is conducted due to lack of resources, is
      there any other way for the payment suspension to continue?

A.    If no law enforcement agency accepts the referral, the State must immediately
      release the payment suspension unless the State has alternative Federal or State
      authority by which it may impose a suspension. In that case, the requirements of
      that alternative authority, including any notice and due process or other
      safeguards, will be applicable.

Q.    If a MFCU accepts a fraud referral from the State but does not want the
      State to suspend payments because it may alert a provider to a pending
      investigation, what should the State do?

A.    If law enforcement officials have specifically requested that a State not impose a
      payment suspension due to the fact that such suspension may compromise an
      existing investigation, this qualifies as good cause to not suspend under the final
      rule. The State should get this request in writing and include the request in its file
      for purpose of annual reporting to the Secretary.

Q.    If a State receives an allegation regarding patient abuse, does the payment
      suspension rule apply?



                                                                                Page 2 of 5
Frequently Asked Questions – Affordable Care Act Section 6402(h)(2)
March 2011


A.    Generally, patient abuse is outside the scope of the final rule, which requires a
      State to suspend payments based upon a pending investigation of a credible
      allegation of fraud. A State, however, is not precluded from taking other action
      against a provider in order to address the patient abuse allegation.


Q.    What action can a State take if a provider argues that a total payment
      suspension is disproportionate to the scope of the alleged fraud?

A.    Under the final rule, a State is permitted to impose just a partial payment
      suspension if it believes that there is good cause. For example, a provider may
      submit written evidence that is acceptable to the State that the payment
      suspension should be imposed only in part. In addition, if a State agrees with the
      provider and suspends only in part, a State must document the basis of the good
      cause for the partial suspension for its files and for purposes of reporting to the
      Secretary.

Q.    When will States be expected to start initiating payment suspensions based
      upon pending investigations of credible allegations of fraud?

A.    The effective date of the final rule directing States to suspend Medicaid payments
      based upon pending investigations of credible allegations of fraud is March 25,
      2011. All MFCU referrals meeting the credible allegation requirement made
      prior to March 25 as well as all on or after that date, must have payments
      suspended unless there is good cause not to do so. We stated in the final rule:
      “We will not require States to retroactively apply the law regarding suspension of
      payments based on pending investigations of credible allegations of fraud.
      However, upon the effective date of this final rule with comment period, we
      expect States, to the extent they have not already done so, to suspend payments to
      providers against whom there exist pending investigations of credible allegations
      of fraud.” (76 Fed. Reg. 5860, 5938).

Q.    How can States mitigate any potential confusion between sharing intelligence
      about concerns regarding providers with their MFCUs and making formal
      referrals which necessitate a payment suspension?

A.    CMS recognizes that States may need to consult and/or exchange information
      with their respective MFCUs prior to making a formal referral. We do not seek to
      limit or otherwise define the circumstances pursuant to which States engage in
      such communications with their MFCUs. In an attempt to limit confusion
      between informal discussions and formal referrals, States may wish to use the
      term “provider notice” when providing information of a strictly “FYI” nature
      about providers to distinguish these discussions from formal referrals to a MFCU
      for purposes of payment suspension.


                                                                              Page 3 of 5
Frequently Asked Questions – Affordable Care Act Section 6402(h)(2)
March 2011


Q.    If a State agency finds billing errors during a provider audit that are not
      related to allegations of fraud would this trigger a payment suspension?

A.    Unless there is evidence or information to the contrary, CMS generally believes
      that mere errors found during the course of an audit would not rise to the
      threshold of “an investigation of a credible allegation of fraud” necessary to
      trigger a payment suspension. Similarly, billing errors that are attributable to
      human error, e.g., inadvertent billing and processing errors, would typically not
      rise to the level of fraud.

Q.    Are managed care organizations subject to payment suspensions?

A.    Yes, managed care organizations are subject to payment suspensions. States
      should suspend payments to managed care entities based upon a pending
      investigation of a credible allegation of fraud.

Q.    When is a payment suspension triggered under section 6402(h)(2)?

A.    An investigation in accordance with 42 C.F.R. § 455.14 regarding the validity of
      an allegation of fraud does not itself trigger a payment suspension. A payment
      suspension is triggered when the State determines that an allegation of fraud is in
      fact credible and refers the matter to its MFCU or other law enforcement agency
      for investigation in accordance with 42 C.F.R § 455.15.

Q.    Is FFP available to States on interest that accrues on suspended payments to
      Medicaid providers?

A.    No, FFP is not available on interest accrued on suspended payments to providers.

Q.    If CMS defers or disallows a State’s FFP and the underlying allegations of
      fraud are later cleared, what is the process by which FFP will be restored?

A.    When CMS determines that claims associated with deferred or disallowed FFP
      are permissible, it will release the deferred or disallowed funds to a State by
      providing FFP for the subject claims.

Q.    Does the final rule regarding suspension of payments apply to individual
      providers who are employed or contracted by institutional providers?

A.    Yes, the payment suspension rule applies to institutional providers as well as
      providers who are employed or contracted by such institutional providers.




                                                                              Page 4 of 5
Frequently Asked Questions – Affordable Care Act Section 6402(h)(2)
March 2011


Q.    Can State Medicaid agencies share potentially helpful information with their
      MFCUs without following the requirements in the rule regarding
      documentation and timing of the referral of a credible allegation of fraud?

A.    States certainly may share information or otherwise consult with their MFCUs.
      CMS does not want to define the circumstances pursuant to which States initially
      communicate with their respective MFCUs with regard to potential referrals of
      fraud to the MFCU. Moreover, CMS recognizes that States may need to consult
      and/or exchange information with their respective MFCUs prior to making a
      formal referral. Nevertheless, fraud referrals from State agencies to MFCUs must
      meet the requirements that are set out in the final rule.

Q.     Are States required to request a quarterly certification from a MFCU or
      other law enforcement agency that a matter accepted on the basis of a fraud
      referral, and which triggered a payment suspension, continues to be under
      active investigation?

A.    Yes. A State's receipt of certification that an active law enforcement investigation
      remains ongoing will assist a State in determining that there is a basis to warrant
      continuing an existing payment suspension. Conversely, law enforcement's
      declination or other refusal to provide such certification in response to a State's
      request may be a factor in a State's determining that good cause exists not to
      continue a payment suspension. CMS did not prescribe any precise format that
      law enforcement certification must take, and recognized that, due to various
      constraints, law enforcement may not be able to provide any specific details with
      respect to matters for which it provides a certification of investigatory status.

Q.    How should States annually report payment suspensions that were imposed
      on providers as a result of pending investigations of credible allegations of
      fraud to the Secretary?

A.    CMS is in the process of creating a web-based portal for purposes of State
      reporting in connection with various provisions of the Affordable Care Act. We
      anticipate that States will initially report information about payment suspensions
      that were imposed on providers during the 3rd and 4th quarters of fiscal year 2011
      using this web-based portal prior to April 1, 2012.

      The information reported by States should include: the nature of the suspected
      fraud, the basis for the suspension, and the outcome of the suspension, where
      applicable, and any other information the Secretary may require. In addition, if
      States exercise good cause to discontinue an existing payment suspension or
      suspend only in part, then such States should also include in their annual reports
      the nature of the good cause.



                                                                              Page 5 of 5
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
7500 Security Boulevard, Mail Stop S2-26-12
Baltimore, MD 21244-1850

Center for Medicaid, CHIP and Survey & Certification

CMCS Informational Bulletin

DATE:          March 25, 2011

FROM:          Cindy Mann, JD
               Director
               Center for Medicaid, CHIP and Survey & Certification (CMCS)

SUBJECT:       Recent Developments in Medicaid and CHIP Policy

This CMCS Informational Bulletin is intended to provide a series of operational policy
clarifications regarding our work implementing the Children’s Health Insurance Program
Reauthorization Act (CHIPRA) of 2009 and the Affordable Care Act of 2010. We hope you will
find this information helpful as you administer these critical health coverage programs.

Further Clarification on CHIPRA Performance Bonuses

In our CMCS Informational Bulletin dated March 3, 2011, we provided information regarding
the criteria needed to meet the program feature --“Liberalization of Asset Tests” -- for purposes
of the Fiscal Year 2011 CHIPRA Performance Bonuses. As you know, the purpose of the
Performance Bonuses is to encourage States to remove barriers that prevent eligible children
from enrolling in and retaining coverage. In our previous Bulletin, we indicated that in order to
qualify for this program feature, States would be required to liberalize the asset test for all
Medicaid categories for which being a child is a condition of eligibility (including the section
1931 family coverage group under which parents can be eligible as well as children). Although
one of the most effective ways to ensure that children are enrolled in coverage is to remove the
asset test for the whole family, it was brought to our attention that States may have mechanisms
in place where, even if there is an asset test for the 1931 group, children’s access to coverage is
not impaired.

CMCS has determined that, for purposes of CHIPRA Performance Bonuses, States will not be
required to remove the asset test for the 1931 eligibility group as long as the State can
demonstrate that all children who are income eligible for Medicaid can be enrolled in one of the
State’s eligibility categories that does not include an asset test and, therefore, will not be denied
eligibility due to an asset test. States may be able to qualify for this program feature if they
submit documentation to show that as of April 1, 2011, children in families that do not qualify
under section 1931 due to assets are placed into another eligibility category and enrolled without
requiring further action on the part of the family.
Page 2 – CMCS Informational Bulletin

We have also determined that States will not be required to liberalize the asset test for the
medically needy eligibility group for children, the group of “Katie Beckett” children eligible
under 1902(e)(3) of the Act, and children eligible under section 1902(a)(10)(A)(ii)(XIX), as
created by the Family Opportunity Act.

To recap, for FY2011, the asset test must be eliminated or self-declaration of assets must be
accepted without the family’s verification for all children enrolled in CHIP and children enrolled
in Medicaid as poverty-related children, Qualified Children, AFDC-related reasonable
classifications of children, non-IV-E State subsidized adoption children, optional targeted low-
income children, and independent foster care adolescents.

As always, States should submit a State Plan Amendment (SPA) to eliminate the asset test for
any eligibility category. These may be in State Plan Attachment 2.2-A, State Plan Attachment
2.6-A, and/or supplements to State Plan Attachment 2.6-A, as appropriate. States that choose to
liberalize the asset test by using self-declaration or administrative verification of assets should
submit supporting documentation of this change with their FY2011 Performance Bonus
Application, but a SPA is not required.

States considering applying for a FY 2011 Performance Bonus are encouraged to contact Dena
Greenblum of the Children and Adults Health Programs Group at 410-786-8684 or via email at
CHIPRABonusPayments@cms.hhs.gov before April 1, 2011 to ensure that all documentation is
in order. We hope this clarification will be helpful.

Coverage of Freestanding Birth Centers

We also wanted to provide States with information regarding section 2301 of the Affordable
Care Act, which ensures Medicaid coverage of care provided in freestanding birth centers.
Section 2301 requires States that recognize freestanding birth centers to provide coverage and
separate payments for freestanding birth center facility services and services rendered by certain
professionals providing services in a freestanding birth center, to the extent the State licenses or
otherwise recognizes such providers under State law. This provision took effect upon enactment
of the Affordable Care Act on March 23, 2010, for services furnished on or after that date, unless
State legislation is required.

States will need to submit amendments to their Medicaid State plans that specify coverage and
separate reimbursement of freestanding birth center facility services and professional services in
order to comply with this provision. Questions regarding this information may be directed to Ms.
Linda Peltz, Director of the Division of Benefits and Coverage at 410-786-3399 or via email at
Linda.peltz@cms.hhs.gov. As always, CMS Regional Office staff are available to assist States in
submitting the appropriate State plan changes.
Page 3 – CMCS Informational Bulletin

Dental Services in FQHCs

Section 501(d) of CHIPRA added a new section 1902(a)(72) of the Social Security Act, which
provides that a State may not prevent a Federally-Qualified Health Center (FQHC) from entering
into contractual relationships with private practice dental providers in the provision of FQHC
services. Section 501(d) also amended section 2107(e)(1)(B) of Title XXI by applying this same
requirement to CHIP. Following are several questions and answers regarding this provision.

Question 1: How does section 501(d) affect State Medicaid and CHIP programs?

Answer 1: This section removes potential barriers to FQHCs contracting with private dental
providers to furnish Medicaid and/or CHIP-covered FQHC services. In the past, some State
Medicaid agencies may have required dental providers who contracted with FQHCs to
individually enroll in the Medicaid program. This is no longer permissible under the statute.
However, States may set standards that are generally applicable to all dental providers and dental
services furnished under the Medicaid and CHIP State plan, such as quality standards, but must
allow FQHCs to contract with qualified providers who meet such standards.

Question 2: How will this provision be implemented?

Answer 2: Dental services furnished off-site by private dental providers who contract with
FQHCs will be covered by Medicaid and CHIP as FQHC services when those dental services are
of the type that would be covered if provided on-site at the FQHC. Payment for such services
should be made to the FQHC in accordance with the State plan. This CHIPRA requirement will
help to ensure dental access for individuals enrolled in CHIP and Medicaid.

Question 3: What is the Health Resources and Services Administration’s (HRSA) role and
responsibility regarding the FQHC program?

Answer 3: FQHCs are defined in section 1905(l)(2)(B) of the Act. To qualify as an FQHC, an
organization must meet one of the following criteria:

   •   Receive a grant under section 330 of the Public Health Service Act,
   •   Be designated as meeting the statutory requirements to receive a grant under section 330
       (commonly known as a “Look-Alike”); or
   •   Be an outpatient health program or facility operated by a tribal or urban Indian
       organization.

HRSA is responsible for administering the FQHC program for those organizations that qualify
under the section 330 grant program of the Public Health Service Act and the Look-Alike
program. In this role, HRSA is responsible for assuring that section 330 grantees and Look-
Alikes meet all the same statutory requirements. HRSA performs its program oversight role in a
similar manner for both types of entities.
Page 4 – CMCS Informational Bulletin

Questions or concerns regarding HRSA’s program requirements, including those regarding
FQHC contract arrangements with providers, should be referred directly to
oppdgeneral@hrsa.gov or to Ms. Tonya Bowers, Director, Office of Policy and Program
Development, Bureau of Primary Health Care, HRSA, who may be reached at (301) 594-4300.

Model Interstate Coordination Process for Medicaid and CHIP

Section 213 of CHIPRA also required that by August 4, 2010, CMS develop a model process
designed to coordinate Medicaid and CHIP enrollment, retention and access to care for children
who frequently change their State of residence. The Secretary is required to submit a Report to
Congress describing additional steps or authority needed to make such further improvements to
coordinate the enrollment, retention and coverage under CHIP and Medicaid for such children.

In July 2010, CMCS released a proposed model process for interstate coordination based on
consideration of comments received in response to the notice published in the Federal Register
on December 18, 2009, information included in the 2006 Report to Congress entitled “Studies
Regarding Barriers to Participation of Farm Workers in Health Programs,” and information
gathered from States and the CMS Tribal Technical Advisory Group. This process has not been
finalized and we are very interested in States’ and other stakeholders’ feedback on the proposed
model.

Proposed Model for Interstate Coordination

Host State Activities
The Host State is the State where a Medicaid or CHIP eligible individual arrives seeking
coverage of medical care. Upon such a request, the Host State will confirm eligibility in the
Home State, and upon receipt of confirmation, issue a Guest Card to the individual and notify the
Home State of the individual’s guest status and current address. The Host State will enroll the
individual through its Medicaid Management Information Systems (MMIS) with a guest status,
including a code that identifies the Home State. The individual will be able to use the Guest
Card to access any services covered by the Host State, subject to the Host State’s limitations and
requirements, from any provider enrolled with the Host State. The Guest will be exempt from
enrollment in any managed care plans or benchmark plans.

Home State Activities
The Home State must confirm eligibility for the Host State, and upon notification from the Host
State of individual’s guest status, change mailing address for the individual on the eligibility file
and place the individual in a suspense status. The individual should be disenrolled from any
managed care plans or benchmark plans, unless the benchmark plan will provide coverage in the
Host State. The Home State remains responsible for eligibility for the individual while out of
State, including performing redeterminations at scheduled intervals.

Federal Financial Participation (FFP)
The Host State will be reimbursed at 100 percent for services provided to Guests. CMS will
adjust the federal matching payment to the Home State by an amount equal to the Home State’s
share of services that were provided to its beneficiaries as Guests.
Page 5 – CMCS Informational Bulletin

Eligibility Verification
The timely and efficient exchange of eligibility data is fundamental to this model. There are
several ways in which eligibility can be verified and data can be exchanged, however, these
methods vary widely with respect to their efficiency and reliability. As could be expected, the
methods that can be implemented most quickly and inexpensively will most likely prove to be
the least efficient, and those that require greater investment of resources will be more efficient
and reliable. The Report to Congress will explore a range of potential eligibility verification
methods.

As we develop the Report to Congress, CMCS encourages stakeholders to provide feedback
regarding the viability of the model coordination process, especially:

•      Suggestions for improvement of the proposal;
•      Identification of CMS policy decisions that must be made in order to put the process in
       place, such as:
       o        the length of time allowed for an individual to be a “guest” in another State
       o       whether to require Host States to cover all benefits available under the State plan
               or just mandatory benefits, and
       o       whether to allow all eligible individuals to be a “guest” in another State or if this
               policy should only apply to mandatory groups; and
•      Identification of implementation issues or major impediments, including statutory,
       regulatory, and/or systems changes that may be needed both for CMS and the States.

The full proposal is available at
http://www.cms.gov/CHIPRA/Downloads/InterstateCoordination.pdf
Please contact Rebecca Bruno of the Division of Eligibility, Enrollment and Outreach at (410)
786-5568 or via email at Rebecca.Bruno@cms.hhs.gov with feedback and suggestions.

$55 Million Awarded in Grants to Further Children’s Quality Measurement

On March 1, 2011, the Agency for HealthCare Research and Quality (AHRQ) awarded
cooperative grants to seven AHRQ-CMS CHIPRA Centers of Excellence in Pediatric Quality
Measures. These Centers are part of the CHIPRA required Pediatric Quality Measures Program
(PQMP) and will: (1) test and refine the initial core set of measures to make them more broadly
applicable to Medicaid, CHIP, and other programs; and (2) develop additional quality measures
that address dimensions of care where standardized measures do not currently exist. The
measures developed by the Pediatric Quality Measures Program will be considered for the
improved CHIPRA core measure set which will be made publically available by January 1, 2013.

The Centers of Excellence awardees are:

1. Gary Freed - Quality Measurement, Evaluation, Testing, Review, and Implementation
Consortium, University of Michigan-Ann Arbor (Ann Arbor, MI)

2. Lawrence Kleinman - Mount Sinai Collaboration for Advancing Pediatric Quality Measures,
Mount Sinai School of Medicine (New York, NY)
Page 6 – CMCS Informational Bulletin

3. Mark Schuster - Children’s Hospital Boston Center of Excellence for Quality
Measurement/Harvard Medical School (Boston, MA)

4. Jeffrey Silber - Children’s Hospital of Philadelphia Center of Excellence/University of
Pennsylvania School of Medicine (Philadelphia, PA)

5. Sarah Hudson Scholle - National Collaborative for Innovation in Quality Measurement –
National Committee for Quality Assurance (Washington, D.C.)

6. Rita Mangione-Smith - Center of Excellence on Quality of Care Measures for Children with
Complex Needs – Seattle Children’s Institute (Seattle, WA)

7. Ramesh Sachdeva – Pediatric Measurement Center of Excellence, Medical College of
Wisconsin/National Outcomes Center (Milwaukee, WI)

A total of $55 million will be awarded to the Centers of Excellence over a period of four years.
For additional information on the CHIPRA AHRQ-CMS Centers of Excellence, visit:
http://www.ahrq.gov/chipra/pqmpfact.htm

We hope you will find this information helpful. Thank you for your commitment to these critical
health coverage programs.
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
7500 Security Boulevard
Baltimore, MD 21244-1850




CPI – CMCS INFORMATIONAL BULLETIN

DATE:          March 25, 2011                                               CPI-B 11-04


FROM:          Peter Budetti
               Director
               Center for Program Integrity (CPI)

               Cindy Mann
               Director
               Center for Medicaid, CHIP and Survey & Certification (CMCS)

SUBJECT:       Affordable Care Act Program Integrity Provisions - Guidance to States --
               Section 6402(h)(2) - Suspension of Medicaid Payments Based Upon Pending
               Investigations of Credible Allegations of Fraud

This Informational Bulletin is part of a series of bulletins intended to provide guidance regarding
implementation of certain provisions of the Patient Protection and Affordable Care Act, Pub. L.
111-148, as amended by the Health Care and Education Reconciliation Act of 2010, Pub. L. 111-
152, together called the “Affordable Care Act.” Specifically, this bulletin provides guidance on
the following program integrity provision in the Affordable Care Act that was included in final
regulations CMS-6028-FC, published on February 2, 2011:

       Section 6402(h) regarding suspension of payments pending an investigation of a credible
       allegation of fraud.


Suspension of Payments

Section 6402(h)(2) of the Affordable Care Act, Suspension of Medicaid Payments Pending
Investigation of Credible Allegations of Fraud amends section 1903(i)(2) of the Social Security
Act to provide that Federal Financial Participation (FFP) in the Medicaid program shall not be
made with respect to any amount expended for items or services (other than an emergency item
or service, not including items or services furnished in an emergency room of a hospital)
furnished by an individual or entity to whom a State has failed to suspend payments under the
plan during any period when there is pending an investigation of a credible allegation of fraud
against the individual or entity as determined by the State, unless the State determines that good

                                                                            7500 Security Boulevard
                                                                                Mailstop: B2-15-24
                                                                              Baltimore, MD 21244
Page 2 – CPI-CMCS Informational Bulletin


cause exists not to suspend such payments. On February 2, 2011, CMS published the final rule
implementing this provision, with an effective date of March 25, 2011. See
http://edocket.access.gpo.gov/2011/pdf/2011-1686.pdf.


Good Cause Exceptions

There are several circumstances that, under the final rule, constitute “good cause” for a State to
determine not to suspend payments, or to discontinue an existing payment suspension, to an
individual or entity despite a pending investigation of a credible allegation of fraud. Good cause
exceptions to terminate a whole payment suspension or impose a partial suspension generally
include the following:

   1. Specific requests by law enforcement that State officials not suspend (or continue to
      suspend) payment.
   2. If a State determines that other available remedies implemented by the State could more
      effectively or quickly protect Medicaid funds than would implementing (or continuing) a
      payment suspension.
   3. If a provider furnishes written evidence that persuades the State that a payment
      suspension should be terminated or imposed only in part.
   4. A determination by the State agency that certain specific criteria are satisfied by which
      recipient access to items or services would otherwise be jeopardized.
   5. A State may, at its discretion, discontinue an existing suspension to the extent law
      enforcement declines to cooperate in certifying that a matter continues to be under
      investigation and therefore warrants continuing the suspension.
   6. A determination by the State agency that payment suspension (in whole or in part) is not
      in the best interests of the Medicaid program.
   7. The credible allegation focuses solely on a specific type of claim or arises from only a
      specific business unit of a provider and the State determines that a suspension in part
      would effectively ensure that potentially fraudulent claims were not continuing to be
      paid.


Questions and Answers

Attached to this Informational Bulletin is operational guidance in the form of “Frequently Asked
Questions” regarding 6402(h)(2) of the Affordable Care Act.

Thank you for your continued commitment to combating fraud, waste and abuse in the Medicaid
and CHIP programs. We look forward to our continuing work together as we implement this
important legislation. Questions regarding this information can be directed to Angela Brice-
Smith at 410-786-4340 or via email at Angela.Brice-Smith@cms.hhs.gov.


                                                                            7500 Security Boulevard
                                                                                Mailstop: B2-15-24
                                                                              Baltimore, MD 21244

				
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