The Centers for Medicare and Medicaid Services has begun to hire new Medicare Administrative Contractors (MACs) in an effort to improve efficiency, customer service and financial management within Medicare.
The first cycle of the program, during which companies will compete for Medicare work in seven multi-state jurisdictions, began in September with a request for proposal.
As part of the Medicare Prescription Drug Improvement and Modernization Act, the program will combine CMS' administrative duties for both Part A and Part B Medicare. A total of 15 primary A/B contracts and four specialty contracts will be awarded.
The new MACs are intended to work with providers as the single point of contact for concerns regarding Medicare claims. Beneficiaries are expected to have fewer paper statements as a result of what the CMS describes as an "integrated and consistent approach to coverage."
A start-up cycle ended in June with the awarding of one primary A/B contract and two Durable Medical Equipment (DME) specialty contracts.
"The purpose of the start-up cycle was to begin the MAC acquisition process with workloads that were comparatively small and stable," said CMS public affairs specialist Ellen B. Griffith. Such workloads, she said, allowed the CMS to "identify lessons learned that could then be applied to the other two acquisition cycles."
The CMS hopes that allowing companies to compete for bids and protest awarded contracts will ensure that final administrators are best suited to service beneficiaries and providers.
"A major aspect of the Medicare Contracting Reform mandate in the Medicare Modernization Act is that CMS fully and openly compete the MAC contracts," said Griffith.
The two DME contracts awarded in the start-up cycle went to Palmetto GBA and Noridian Administrative Services (NAS). CIGNA Healthcare protested both awards, and ultimately won Palmetto’s contract. NAS retained its DME contract and also won the primary A/B contract for that cycle.
Prospective MACs are now competing for the first three cycle one contracts, which are for jurisdictions covering 12 states and Washington D.C. Cycle one is scheduled to end in September 2007.
If the CMS program continues on schedule, MACs will be handling Medicare's full fee-for-service workload by October 2009.