The Centers for Medicare & Medicaid Services issued final regulations that will fully implement improvements to the Payment Error Rate Measurement (PERM) for Medicaid and the Children's Health Insurance Program (CHIP).
"Like other large federal programs, Medicare, Medicaid and CHIP are susceptible to errors or improper payments," said CMS Administrator Don Berwick, MD. "The rules we are issuing today – developed with feedback and input from states and other stakeholders – allow us to implement strategies for reducing the rate of errors in Medicaid and CHIP more effectively."
PERM measures improper payments in Medicaid and CHIP and produces national-level error rates for each program. These reviews are conducted to determine whether the sampled cases meet applicable Medicaid and CHIP fee-for-service, managed care and eligibility requirements.
Generally, PERM is conducted annually in 17 states. A single state typically participates in the program once every three years.
The final regulation implements changes to both programs required by the Children's Health Insurance Program Reauthorization Act of 2009 and makes other operational changes to the programs based on feedback from stakeholders.
The rule changes the process for reviewing cases in which states have used simplified enrollment efforts such as self-declaration for eligibility cases; eliminates duplication of effort between eligibility reviews administered in the same fiscal year; extends the timeframe for providers to submit documentation; and provides states additional time to submit corrective action plans.
Berwick said CMS plans to conduct educational sessions with state staff to ensure there is a complete understanding of the changes to the programs set forth by the final rule and will work with them on ways to further reduce payment errors in Medicaid and CHIP.