Section_21_Payment_Files_Process_RV_EFT_and_1099_Legacy_version_20140106.doc

Requirements Specification Document (LEGACY DRAFT)

DRAFT Payment Files Process: RV/EFT and 1099 (Section 21)

Central Bill Process

Payment Files Process: RV/EFT and 1099 (PWS Section 21) Requirements Specification Document

(LEGACY DRAFT)

Prepared for:

U.S. Department of Labor Office of Worker’s Compensation Programs

Revision History:

SPECIAL NOTICE: This document is a legacy draft requirements specification document developed between 2011 and 2012. As outlined in the Performance Work Statement, the Contractor will be required to review this RSD and make appropriate updates wherever necessary. (Please refer to PWS R0052 for more details.)

Table of Contents Payment Files Process: RV/EFT and 1099 - DFEC

61.1 Payment Files Process: RV/EFT and 1099 Overview - DFEC

71.2 Payment Files Process: RV/EFT and 1099 Business Process Description - DFEC

71.2.1 Payment Files Process

71.2.2 Remittance Voucher (RV), Payment and EFT Generation

81.2.3 1099 Processing

81.2.3.1 Process for Resolving 1099 Mailing Issues

91.2.4 Accounts Receivable Flow in Payment Process

91.2.4.1 Payment Reissuance through PACER

111.2.4.2 Special Payment Handling

111.2.4.2.1 From the National/District Office

111.2.4.2.2 For the DFEC program

121.3 Payment File Process Business Process Flow - DFEC

121.3.1 Payment File Process Overview Workflow

131.3.2 Accounts Receivable in Payment Processing Workflow

Payment Files Process: RV/EFT and 1099 - DEEOIC

142.1 Payment Files Process: RV/EFT and 1099 Overview - DEEOIC

152.2 Payment Files Process: RV/EFT and 1099 Business Process Description - DEEOIC

152.2.1

152.2.2

162.2.3 1099-MISC` Processing

162.2.3.1

172.2.4

172.2.4.1 Payment Reissuance through PACER

182.2.4.2

182.2.4.2.1 From the National Office

192.3 Payment File Process Business Process Flow - DEEOIC

192.3.1

202.3.2

Payment Files Process: RV/EFT and 1099 Business Process Description - DCMWC

213.1 Payment Files Process: RV/EFT and 1099 Overview - DCMWC

223.2 Payment Files Process: RV/EFT and 1099 Business Process Description - DCMWC

223.2.1

223.2.2

233.2.3 1099-MISC Processing

233.2.3.1

243.2.4

253.2.4.1 Reissuing Payments

253.2.4.2

253.2.4.2.1 From the National Office

263.3 Payment File Process Business Process Flow - DCMWC

263.3.1

273.3.2

283.3.3 Recoupment Overview Workflow – DCMWC

Payment File Process Business Requirements

294.1 Functional Requirements

314.2 Business Rules

Payment Processing Supporting Functional Components

555.1 Initial Data Migration

565.2 Interfaces

575.3 Reports

595.4 Letters

Constraints

636.1 Assumptions

636.2 Dependencies

636.3 Issues/Open Items

Appendices

647.1 Terms & Definitions

697.2 Tax Verification Chart

707.3 1099 Tax Form

717.4 Existing AR1 Record Definition (NA for DCMWC)

727.5 Existing AR2 Record Definition (NA for DCMWC)

737.6 Existing AR3 Record Definition (NA for DCMWC)

747.7 Existing Treasury Check File Record Definition - DFEC

777.7.1 Existing Valid Values for: WW-100-AGENCY-LOCATION - DFEC

787.7.2 Existing Valid Values for: WW-100-AGENCY-ADDRESS - DEFC

827.8 Existing Treasury Check File Record Definition - DEEOIC

867.9 Existing Treasury EFT File Record Definition - DFEC

897.9.1 Existing Valid Values for WW-200-AGENCY-LOC & WW-200-AGENCY LOCATION - DFEC

917.9.2 Existing Valid Values for WH-500-DISTRICT (within field WW-200-SCHEDULE-NUM) - DFEC

947.9.3 Existing Copybook W053501S: for W1415514-SPECIAL-INDICATOR - DFEC

957.9.4 Existing Copybook W053241S: for W1100012-EFT-TRANS-CODE, W1200012-EFT-TRANS-CODE

977.10 Existing Treasury EFT File Record Definition - DEEOIC

1007.10.1 Existing Copybook W053501S: for W1415514-SPECIAL INDICATOR - DFEC

1017.10.2 Copybook W053241S: for W1100012-EFT-TRANS-CODE, W1200012-EFT-TRANS-CODE - DFEC

1037.11 Reason Codes in AR2 Record (NA for DCMWC)

1037.12 Accept/Reject codes when iFECS echoes back an AR1 Record – DFEC (NA for DCMWC)

1037.13 Origin Codes when iFECS sends or echoes back an AR1 Record – DFEC (NA for DCMWC)

1047.14 Action Codes in an AR2 Record (NA for DCMWC)

1047.14.1.1 General Action Codes

1057.14.2 Administrative Action Codes (affects 1099) (NA for DCMWC)

1057.14.3 Cancellation Action Codes (NA for DCMWC)

1067.14.4 Cancellation Reason Codes for Cancellation Actions (NA for DCMWC)

1067.15 Current ACS Accounting Codes and/or Adjustment Reason Codes in the Weekly Bill History File – DFEC, DEEOIC, and DCMWC

1087.16 Existing Treasury Check File Record Definition - DCMWC

1137.17 Existing Treasury EFT File Record Definition - DCMWC

1177.18 Cash Recoupment Control Layout - DCMWC

1197.19 Cash Recoupment Layout – DCMWC

1217.20 Adjustment Reason Codes - DCMWC

1247.21 Overpayments Extract Layout – DCMWC

1 Payment Files Process: RV/EFT and 1099 - DFEC

1.1 Payment Files Process: RV/EFT and 1099 Overview - DFEC

The ability to provide continual accountability and control of all bills in the medical bill process, to produce accurate reports for balancing bill counts per cycle, to document total bill counts and dollar amounts at the end of each payment cycle, and to generate final payment summary reports is absolutely essential to ensure that providers are paid accurately and timely for the services billed. The proper use of information, processes, and tools such as payment files, EFT, Checks, IRS Levy, Debts, remittance vouchers (RVs), and 1099s facilitates the financial management needed to support the CBP.

The provider master file will be closely integrated with bill processing and bill pricing, a solution which will ensure that reports to the Government for use in monitoring its expenditures will be accurate. Effective payment file processing rules will help DOL track the number of bills processed for payment adjudication according to bill type, the transaction navigation according to EFT and 1099 requirements, and the reporting of all transactions through the RV generation process. Following are the salient points in the process:

· Provides a simple way of ensuring that the Bill Processing Adjudication Summary, which is produced by each adjudication cycle, is balanced.

· Details the bill counts and dollar amounts at the end of the payment cycle, including any provider negative balances.

· Provides a mechanism for balancing the preliminary payment summary through the Final Payment Summary Report.

The CBP medical bill process will be configured to handle the payment file processing along with the RV, EFT/Checks, and 1099-MISC processing capabilities. The Contractor will complete the bill payment and RV processing according to the DOL specified schedule, and will transmit check and EFT payment files in the DOL-specified format. During the weekly payment cycle, a remittance voucher (RV) will be produced for every bill that was successfully adjudicated, and will show the amount paid or the reasons for bill denial, cut-backs, IRS Payments, and Adjustments (amounts owed to DOL as well amounts due to the provider/claimant), for each claimant/provider. The template message from EOB records will provide contextual meaning for the adjudication listed on the RV. The Contractor will include unique identifiers on each check and EFT, as well as information to identify the corresponding program and RV numbers.

The Contractor will also transmit all Treasury medical payment files to the Government on a weekly schedule as defined by DOL. The US Treasury Department produces and mails the check, and processes EFT for each program. As per Federal requirements, IRS 1099-MISC forms will also be delivered to all providers that have been paid more than $600.00 (net amount) for the entire tax year.

1.2 Payment Files Process: RV/EFT and 1099 Business Process Description - DFEC

1.2.1 Payment Files Process

Following are the high-level procedures for payment file processing:

· The Contractor will send two payment files (Check and EFT) for each program to DOL. DOL will then forward the payment files to Treasury.

· DOL will download the accomplishment data for the payment files sent to Treasury.

· The accomplishment data will be sent in two separate files to the Contractor in spreadsheet format containing all District Offices sorted by ALC number, (2 files: 1 each EFT and Check)

· The Contractor will process the accomplishment files during the weekly payment cycle on every Saturday. The accomplishment file will not be available until Monday of the next week following the check date at the earliest.

· The Contractor will use the accomplishment data to apply the Treasury Check and EFT number for each line item in the Check History File.

1.2.2 Remittance Voucher (RV), Payment and EFT Generation

The Contractor will coordinate and complete the bill payment and RV processing on each Saturday after a weekly cycle. In a typical cycle:

· RVs will be printed after the payment cycle and will be distributed on the following Monday The Contractor will forward all Treasury medical bill payment files to DOL no later than close of business on Monday.

· The corresponding checks will be sent on Thursday of the same week. The schedule will allow for the issuance of an RV before the issuance of the corresponding check to the provider.

· EFT payments will be made available in the payee's bank account on the program's payment date. An electronic RV (ANSI 835) will be issued to authorized providers.

· Check date must be adjustable. Schedule is mandated by OWCP/Treasury taking holidays into consideration.

The RV sent in advance of a payment to a provider will show all paid and denied bills for that payee, detailing the amount paid for the paid bills and the EOB for denied bills/bill line items. This also includes adjustments, recoupments, and reporting process, as well as the IRS lien payments and reporting processes as provided. RVs will include detailed information including provider ID, claimant ID, check reference number (internal check number, not the Treasury number), RV number, and bill information with a Transaction Control Number (TCN) to help providers identify the amounts paid or denied in each bill by the various programs. The billed charges and paid charges will be displayed in the RV. Denied bills/bill line items will have a reimbursement amount shown as “$0.00.” The RVs will also summarize for a given combination of provider/claimant all the bills processed successfully in the bill payment cycle in each program grouped by payment status of paid or denied. The bottom of the RV will provide the EOB code(s) and description. Any lines of the bill that are denied, or partial-paid, or reflect any reduction of allowed amount due to cutback will provide the EOB code on the corresponding line. The RVs may also contain additional messages or announcements based on the type of provider or bill for selected providers and claimants as and when requested by the DOL (i.e., as part of provider outreach communication).

All RVs will automatically be created and exported to the mailroom for printing, imaging, and retrieval as needed by both internal and external entities. Authorized providers will access the RVs via the CBP Web Portal within one (1) day of the completion of the corresponding payment cycle. All RVs generated from the payment cycle will be stored in the Contractor’s image repository system () according to program-specific periods of time, and be available for online retrieval using several search parameters such as provider ID, Check number, date, etc.

The Contractor will provide sufficient Government approved information to the providers to link payments with specific services in the RV, including but not limited to cross-references to payees and specific Treasury file payments, RV numbers, and program names. Correspondingly, the RV number and internally generated 'warrant' number will be submitted as part of the Treasury Check/EFT files to provide the link from payments to RVs.

1.2.3 1099 Processing A 1099 is a Federal tax form sent to providers that reflects income in the form of payments made according to their Tax ID Number. The 1099 calculates all payments made to a particular Tax ID Number in a calendar year. Providers will receive a separate 1099 for each Program (DFEC, DCMWC, and DEEOIC). The Contractor will provide electronic copies of 1099-MISC forms to the IRS (via data files) and other documentation specified by the Government, and hardcopy 1099-MISC forms to qualifying providers. The generated 1099's will also be retrievable from the imaging system by DOL National and District Offices. The requirements, formats, forms and dates associated with filing 1099-MISC data are contained in IRS Publication 1220, which is printed at the beginning of the tax year. The Contractor will review this document upon publication to determine whether any changes have been enacted in how to proceed with filing 1099-MISC forms and data.

The Contractor will issue 1099-MISC forms for all providers based on Tax IDs that have been paid a net amount of more than $600.00 for the reporting tax year. The Contractor will conform to the qualifications and thresholds established by the US Treasury. The current $600.00 amount might change based upon changes in rules. The Central Mailroom’s print generation software will ensure that 1099-MISC forms are generated and issued with payment amounts in the appropriate box, based on Tax ID. The Contractor should understand that in the 1099-MISC process,most services are identified as Medical Payments and referenced in the "Medical and Health Care Payments Box, . The Contractor will ensure that if a provider bills for procedure code "HRENT" which will not be based on the TAX ID number, to place these payments in the BOX #1 "RENTS" of the 1099-MISC form. The Contractor will also ensure that the 1099-MISC forms and information are submitted to the IRS using IRS specified formats and technologies, on or before a date specified by the Government. The Contractor will mail the 1099-MISC forms to the providers by January 15th, or the next business day after January 15th if January 15th is not a business day, of the year following the tax year being processed. The Contractor will verify that the information submitted is correct according to the 1099-MISC Tax Form Verification Chart (Appendix 7.2). The 1099 Form (Appendix 7.3) and block names must match the Contractor’s data field name.

1.2.3.1 Process for Resolving 1099 Mailing Issues

The Contractor should understand the importance of the 1099-MISC process, and will immediately notify and report to DOL all issues encountered when distributing the 1099-MISC forms. The Contractor will provide reporting status on the 1099-MISC process to DOL, and immediately notify the Government of any failure that affects the 1099-MISC processing. For program-specific 1099-MISC forms returned as undeliverable, the Contractor will provide a report to DOL detailing each intended mail recipient and attempts to resolve the issue. To reduce the likelihood of undeliverable mail, the Contractor will use National Change of Address (NCOA) software to ensure that the most current address on file with the USPS is used. If a 1099-MISC form is returned, the Contractor will verify the address information within CBP and cross-check that against the NCOA database to determine if a change of address has occurred. If there are no discrepancies found between these addresses, the Contractor will make a reasonable effort to contact the provider via phone (using the number on record) or other available means. If the Contractor is still unable to deliver the 1099-MISC, the Contractor will report to DOL the findings and actions taken. The Contractor will reissue 1099-MISC forms when required and authorized by the Government.

1.2.4 Accounts Receivable Flow in Payment Process

An important component of the adjustment process is to support an Accounts Receivable function, in which balances are established for providers who were overpaid. Adjustment processing may result in an overpayment, and needs to be identified by use of interface files to communicate A/R transactions between the CBP and DOL systems. Below are some of the situations that will trigger the use of A/R messages between the systems:

· Notification to DOL that an overpayment exists for a provider, or notification from DOL that a payment was returned from the provider due to overpayment. Pharmacy debts are included in this process where AR1 transactions are created as a result of Out-of-Cycle Reversal Transaction , or transactions performed by the Contractor during adjustment processing

· Acknowledgement received from DOL to create a debt

· Instruction from DOL to begin recoupment of the debt from the provider

· Payments received or recouped as full or partial payment of the debt

· Notification from DOL that a debt is paid in full

· Notification from the government to Write-Off a Debt (AR3)

· Notification from DOL to cancel a Check

The CBP adjustment process will support DOL's recoupment process. In the event an adjustment results in an overpayment, the respective programs will be notified of such overpayment via an interfacefile. The Contractor will use an interface file with specific layout from the programs to facilitate this process.

Program-specific accounts receivables will be maintained to track information such as payments (by pay-center), liens, recoupments, debts, etc. The Contractor 's CBP system will maintain and record the flow of an AR1, AR2, AR3, WI (Interest and Principal write-offs), and WD (Debt write-offs) for each pay center (the record layouts for AR1, AR2, AR3, and values of reason codes, accept/reject codes, origin codes, action codes are captured in Appendix 7.4 thru 7.10).

In each payment cycle, the CBP will identify the bills for the claimants and providers for the three programs where receivables are due resulting from National Office payments, liens, and recoupments. The system will further quantify, re-total and track the receivables for each case. The CBP system will report to affected providers, via the RV, any payments withheld in whole or in part to satisfy accounts receivable. The Contractor will also record on the RV for providers and claimants the additional amounts being paid as a result of an adjustment, refund, or re-issuance.

1.2.4.1 Payment Reissuance through PACER

The Contractor should understand that there will be situations where providers or claimants do not receive their payment due to address changes, or other valid reasons. The Contractor will develop an operational procedure to reissue the payment, but only after researching if and when the payment was made and if the check was cashed. The Contractor will use PACER (Treasury application) to perform this research function. The Contractor will register the appropriate employees with Treasury to obtain access to PACER. The Contractor will use this application to perform such research before reissuing payments. Once research has been completed, the Contractor will make the appropriate changes to address or banking information prior to re-issue of payment. After the payment has been outstanding in the current PACER system for 45 days, the Contractor will cancel the payment in Pacer, and will not re-issue the payment unless directed by DOL. PACER can’t be used to make a payment or re-issue a payment.

1.2.4.2 Special Payment Handling

1.2.4.2.1 From the National/District Office

If the District Office sends a (AR3) transaction through the automated adjustment system to refund monies to the provider or claimant, the Contractor will record the updates as a “history only” transaction. If the District Office or National Office sends a transaction through the automated adjustment system to refund monies to the provider or claimant, the Contractor will ensure that the refund of this payment is paid through the CBP system and identified appropriately on a RV.

1.2.4.2.2 For the DFEC program

The Contractor will withhold future Pharmacy payments, in whole or in part (via the payment files sent to DOL), to any provider with accounts receivables if future payments are due for the same DFEC case number for which the account receivable was created if the payment from which withholding occurs is within 120 days of the generation of the account receivable (for DFEC overpayments, the withholding is for a future payment for the same provider-case number combination). The Contractor will notify the appropriate District Office when a DFEC account receivable ages beyond 120 days.

1.3 Payment File Process Business Process Flow - DFEC

The following diagrams capture the DFEC Payment Files: RV/EFT and 1099 Business Process flow.

1.3.1 Payment File Process Overview Workflow

This diagram shows the flow during the payment file process.

1.3.2 Accounts Receivable in Payment Processing Workflow

This diagram describes the interaction of account receivable flows in the payment process.

An AR1 Transaction should display Amt Payable "to DOL" message in the RV. If a transaction is created which results in an AR2 as the result of an adjustment performed by the contractor and results in the payment of additional monies, the RV should state "Net Amount Payable to you" (provider and/or claimant). If a transaction is sent from the District Office through the interface file resulting in an AR3 transaction, the RV should state "Net Amount Refunded to you" (provider and/or claimant).

2 Payment Files Process: RV/EFT and 1099 - DEEOIC

2.1 Payment Files Process: RV/EFT and 1099 Overview - DEEOIC

The ability to provide continual accountability and control of all bills in the medical bill process, to produce accurate reports for balancing bill counts per cycle, to document total bill counts and dollar amounts at the end of each payment cycle, and to generate final payment summary reports is absolutely essential to ensure that providers are paid accurately and timely for the services billed. The proper use of information, processes, and tools such as payment files, EFT, Checks, IRS Levy, Debts, remittance vouchers (RVs), and 1099s facilitates the financial management needed to support the CBP.

The provider master file will be closely integrated with bill processing and bill pricing, a solution which will ensure that reports to the Government for use in monitoring its expenditures will be accurate. Effective payment file processing rules will help DOL track the number of bills processed for payment adjudication according to bill type, the transaction navigation according to EFT and 1099-MISC requirements, and the reporting of all transactions through the RV generation process. Following are the salient points in the process:

· Provides a simple way of ensuring that the Bill Processing Adjudication Summary, which is produced by each adjudication cycle, is balanced.

· Details the bill counts and dollar amounts at the end of the payment cycle, including any provider negative balances.

· Provides a mechanism for balancing the preliminary payment summary through the Final Payment Summary Report.

The Contractor’s CBP will be configured to handle the payment file processing along with the RV, EFT/Checks, and 1099-MISC processing capabilities. The Contractor will complete the bill payment and RV processing according to the DOL specified schedule, and will transmit check and EFT payment files in the DOL-specified format. During the weekly payment cycle, a remittance voucher (RV) will be produced for every bill that was successfully adjudicated, and will show the amount paid or the reasons for bill denial, cut-backs, IRS Payments, and Adjustments (amounts owed to DOL as well as amounts due to the provider/claimant), for each claimant/provider. The template message from EOB records will provide contextual meaning for the adjudication listed on the RV. The Contractor will include unique identifiers on each check and EFT, as well as information to identify the corresponding program and RV numbers.

The Contractor will also transmit all Treasury medical payment files to the Government on a weekly schedule as defined by DOL. The US Treasury Department produces and mails the check, and processes EFT for each program. As per Federal requirements, IRS 1099-MISC forms will also be delivered to all providers that have been paid more than $600.00 (net amount) for the entire the tax year.

2.2 Payment Files Process: RV/EFT and 1099 Business Process Description - DEEOIC

2.2.1 Payment Files Process

Following are the high-level procedures for payment file processing:

· The Contractor will send two payment files (Check and EFT) for each program to DOL. DOL will then forward the payment files to Treasury.

· DOL will download the accomplishment data for the payment files sent to Treasury.

· The DEEOIC accomplishment data will be sent in one file containing the Treasury check ranges and EFT trace ranges to the Contractor in spreadsheet format sorted by ALC number.

· The Contractor will process the accomplishment files during the weekly payment cycle on every Saturday. The accomplishment file will not be available until Monday of the next week following the check date at the earliest.

· The Contractor will use the accomplishment data to apply the Treasury Check and EFT number for each line item in the Check History File.

2.2.2 Remittance Voucher (RV), Payment and EFT Generation

The Contractor will coordinate and complete the bill payment and RV processing on each Saturday after a weekly cycle. In a typical cycle:

· RVs will be printed after the payment cycle and will be distributed on the following Monday. The Contractor will forward all Treasury medical bill payment files to DOL no later than close of business on Monday.

· The corresponding checks will be sent on Thursday of the same week. The schedule will allow for the issuance of an RV before the issuance of the corresponding check to the provider.

· EFT payments will be made available in the payee's bank account on the program's payment date. An electronic RV (ANSI 835) will be issued to authorized providers.

· Check dates must be adjustable. Schedule is mandated by OWCP/Treasury taking holidays into consideration.

The RV sent in advance of a payment to a provider will show all paid and denied bills for that payee, detailing the amount paid for the paid bills and the EOB for denied bills/bill line items. This also includes adjustments, recoupments, and reporting process, as well as the IRS lien payments and reporting processes as provided. RVs will include detailed information including provider ID, claimant ID, check reference number (internal check number, not the Treasury number), RV number, and bill information with a Transaction Control Number (TCN) to help providers identify the amounts paid or denied in each bill by the various programs. The billed charges and paid charges will be displayed in the RV. Denied bills/bill line items will have a reimbursement amount shown as “$0.00.” The RVs will also summarize for a given combination of provider/claimant all the bills processed successfully in the bill payment cycle in each program grouped by payment status of paid or denied. The bottom of the RV will provide the EOB code(s) and description. Any lines of the bill that are denied, or partial-paid, or reflect any reduction of allowed amount due to cutback will provide the EOB code on the corresponding line. The RVs may also contain additional messages or announcements based on the type of provider or bill for selected providers and claimants as and when requested by the DOL (i.e., as part of provider outreach communications).

All RVs will automatically be created and exported to the mailroom for printing, imaging, and retrieval as needed by both internal and external entities. Authorized providers will access the RVs via the CBP Web Portal within one (1) day of the completion of the corresponding payment cycle. All RVs generated from the payment cycle will be stored in the Contractor’s image repository system () according to program-specific periods of time, and be available for online retrieval using several search parameters such as provider ID, Check number, date, etc.

The Contractor will provide sufficient Government approved information to the providers to link payments with specific services in the RV, including but not limited to cross-references to payees and specific Treasury file payments, RV numbers, and program names. Correspondingly, the RV number and internally generated 'warrant' number will be submitted as part of the Treasury Check/EFT files to provide the link from payments to RVs.

2.2.3 1099-MISC` Processing A 1099-MISC is a Federal tax form sent to providers that reflects income in the form of payments made according to their Tax ID Number. The 1099-MISC calculates all payments made to a particular Tax ID Number in a calendar year. Providers will receive a separate 1099-MISC for each Program (DFEC, DCMWC, and DEEOIC). The Contractor will provide electronic copies of 1099-MISC forms to the IRS (via data files) and other documentation specified by the Government, and hardcopy 1099-MISC forms to qualifying providers. The generated 1099-MISC's will also be retrievable from the imaging system by DOL National and District Offices. The requirements, formats, forms and dates associated with filing 1099-MISC data are contained in IRS Publication 1220, which is printed at the beginning of the tax year. The Contractor will review this document upon publication to determine whether any changes have been enacted in how to proceed with filing 1099-MISC forms and data.

The Contractor will issue 1099-MISC forms for all providers based on Tax ID that have been paid a net amount of more than $600.00 for the reporting tax year. The Contractor will conform to the qualifications and thresholds established by the US Treasury. The current $600.00 amount might change based upon changes in rules. The Central Mailroom’s print generation software will ensure that 1099-MISC forms are generated and issued with payment amounts in the appropriate box, based on Tax ID. In the 1099 process most services are identified as Medical Payments and referenced in the "Medical and Health Care Payments Box. The Contractor will ensure that if a provider bills for procedure code "HRENT" which will not be based on the TAX ID number, to place these payments in the BOX #1 "RENTS" of the 1099-MISC form. The Contractor will also ensure that the 1099-MISC forms and information are submitted to the IRS using IRS specified formats and technologies, on or before a date specified by the Government. The Contractor will mail the 1099-MISC forms to the providers by January 15th, or the next business day after January 15th if January 15th is not a business day, of the year following the tax year being processed. The Contractor will verify that the information submitted is correct according to the 1099-MISC Tax Form Verification Chart (Appendix 7.2). The 1099 Form (Appendix 7.3) and block names must match the CBP data field name.

2.2.3.1 Process for Resolving 1099 Mailing Issues

The Contractor should understand the importance of the 1099-MISC process, and will immediately notify and report to DOL all issues encountered when distributing the 1099-MISC forms. The Contractor will provide reporting status on the 1099-MISC process to DOL, and immediately notify the Government of any failure that affects the 1099-MISC processing. For program-specific 1099-MISC forms returned as undeliverable, the Contractor will provide a report to DOL detailing each intended mail recipient and attempts to resolve the issue. To reduce the likelihood of undeliverable mail, the Contractor will use National Change of Address (NCOA) software to ensure that the most current address on file with the USPS is used. If a 1099-MISC is returned, the Contractor will verify the address information within CBP and cross-check that against the NCOA database to determine if a change of address has occurred. If there are no discrepancies found between these addresses, the Contractor will make a reasonable effort to contact the provider via phone (using the number on record) or other available means. If the Contractor is still unable to deliver the 1099-MISC, the Contractor will report to DOL the findings and actions taken. The Contractor will reissue 1099-MISC forms when required and authorized by the Government.

2.2.4 Accounts Receivable Flow in Payment Process

An important component of the adjustment process is to support an Accounts Receivable function, in which balances are established for providers who were overpaid. Adjustment processing may result in an overpayment, and needs to be identified by use of interface files to communicate A/R transactions between the CBP and DOL systems. Below are some of the situations that trigger the use of A/R messages between the systems:

· Notification to DOL that an overpayment exists for a provider, or notification from DOL that a payment was returned from the provider due to overpayment. Pharmacy debts are included in this process where AR1 transactions are created as a result of Out-of-Cycle Reversal Transactions, or transactions performed by the Contractor during adjustment processing

· Acknowledgement received from DOL to create a debt

· Instruction from DOL to begin recoupment of the debt from the provider

· Payments received or recouped as full or partial payment of the debt

· Notification from DOL that a debt is paid in full

· Notification from the government to Write-Off a Debt (AR3)

· Notification from DOL to cancel a Check

The CBP adjustment process will support DOL's recoupment process. In the event an adjustment results in an overpayment, the respective programs will be notified of such overpayment via an interface file. The Contractor will use an interface file with a specific layout from the programs to facilitate this process.

Program-specific accounts receivables will be maintained to track information such as payments (by pay-center), liens, recoupments, debts, etc. The Contractor 's CBP system will maintain and record the flow of an AR1, AR2, AR3, WI (Interest and Principal write-offs), and WD (Debt write-offs) for each pay center (the record layouts for AR1, AR2, AR3, and values of reason codes, accept/reject codes, origin codes, action codes are captured in Appendix 7.4 thru 7.10).

In each payment cycle, the CBP will identify the bills for the claimants and providers for the three programs where a receivable is due resulting from National Office payments, liens, and recoupments. The system will further quantify, re-total and track the receivables for each case. The CBP system will report to affected providers, via the RV, any payments withheld in whole or in part to satisfy accounts receivable. The Contractor will also record on the RV for providers and claimants the additional amounts being paid as a result of an adjustment, refund, or re-issuance.

2.2.4.1 Payment Reissuance through PACER

The Contractor should understand that there will be situations where providers or claimants do not receive their payment due to address changes, or other valid reasons. The Contractor will develop an operational procedure to reissue the payment, but only after researching if and when the payment was made and if the check was cashed. The Contractor will use PACER (Treasury application) to perform this research function. The Contractor will register the appropriate employees with Treasury to obtain access to PACER. The Contractor will use this application to perform such research before reissuing payments. Once research has been completed, the Contractor will make the appropriate changes to address or banking information prior to re-issue of payment. After the payment has been outstanding in the current PACER system for 45 days, the Contractor will cancel the payment in Pacer, and will not re-issue the payment unless directed by DOL. PACER can’t be used to make a payment or re-issue a payment.

2.2.4.2 Special Payment Handling

2.2.4.2.1 From the National Office

If a transaction is sent from the National Office resulting in a (AR3) transaction to refund monies to the provider or claimant, the Contractor will record the updates as a “history only” transaction. The Contractor will ensure that the refund of this payment is paid through the CBP system and identified appropriately on a RV.

2.3 Payment File Process Business Process Flow - DEEOIC

The following diagrams capture the DEEOIC Payment Files: RV/EFT and 1099 Business Process flow.

2.3.1 Payment File Process Overview Workflow

2.3.2 Accounts Receivable in Payment Processing Workflow

This diagram describes the interaction of account receivable flows in the payment process.

An AR1 Transaction should display Amt Payable "to DOL" message in the RV. If a transaction is created which results in an AR2 as the result of an adjustment performed by the contractor and results in the payment of additional monies, the RV should state "Net Amount Payable to you" (provider and/or claimant). If a transaction is sent from the National Office resulting in an AR3 transaction, the RV should state "Net Amount Refunded to you" (provider and/or claimant).

3 Payment Files Process: RV/EFT and 1099 Business Process Description - DCMWC

3.1 Payment Files Process: RV/EFT and 1099 Overview - DCMWC

The ability to provide continual accountability and control of all bills in the medical bill process, to produce accurate reports for balancing bill counts per cycle, to document total bill counts and dollar amounts at the end of each payment cycle, and to generate final payment summary reports is absolutely essential to ensure that providers are paid accurately and timely for the services billed. The proper use of information, processes, and tools such as payment files, EFT, Checks, IRS Levy, Debts, remittance vouchers (RVs), and 1099s facilitates the financial management needed to support the CBP.

The provider master file will be closely integrated with bill processing and bill pricing, a solution which will ensure that reports to the Government for use in monitoring its expenditures will be accurate. Effective payment file processing rules will help DOL track the number of bills processed for payment adjudication according to bill type, the transaction navigation according to EFT and 1099-MISC requirements, and the reporting of all transactions through the RV generation process. Following are the salient points in the process:

· Provides a simple way of ensuring that the Bill Processing Adjudication Summary, which is produced by each adjudication cycle, is balanced.

· Details the bill counts and dollar amounts at the end of the payment cycle, including any provider negative balances.

· Provides a mechanism for balancing the preliminary payment summary through the Final Payment Summary Report.

The CBP will be configured to handle the payment file processing along with the RV, EFT/Checks, and 1099-MISC processing capabilities. The Contractor will complete the bill payment and RV processing according to the DOL specified schedule, and will transmit check and EFT payment files in the DOL-specified format. During the weekly payment cycle, a remittance voucher (RV) will be produced for every bill that was successfully adjudicated, and will show the amount paid or the reasons for bill denial, cut-backs, IRS Payments, and Adjustments (amounts owed to DOL as well as amounts due to the provider/claimant), for each claimant/provider. The template message from EOB records will provide contextual meaning for the adjudication listed on the RV. The Contractor will include unique identifiers on each check and EFT, as well as information to identify the corresponding program and RV numbers.

The Contractor will also transmit all Treasury medical payment files to the Government on a weekly schedule as defined by DOL. The US Treasury Department produces and mails the check, and processes EFT for each program. As per Federal requirements, IRS 1099-MISC forms are also delivered to all providers that have been paid more than $600.00 (net amount) for the entire the tax year.

3.2 Payment Files Process: RV/EFT and 1099 Business Process Description - DCMWC

3.2.1 Payment Files Process

Following are the high-level procedures for payment file processing:

· The Contractor will send two payment files (Check and EFT) for each program to DOL. DOL will then forward the payment files to Treasury.

· DOL will download the accomplishment data for the payment files sent to Treasury.

· The accomplishment data will be sent in one file to the Contractor in spreadsheet format containing all District Offices with one ALC number for medical payments prior to the payment cycle.

· The Contractor will process the accomplishment files during the weekly payment cycle. The accomplishment file will not be available until Monday of the next week following the check date at the earliest.

· The Contractor will use the accomplishment data to apply the Treasury Check and EFT number for each line item in the Check History File.

3.2.2 Remittance Voucher (RV), Payment and EFT Generation

The Contractor will coordinate and complete the bill payment and RV processing after a weekly cycle. In a typical cycle:

· RVs will be printed after the payment cycle and will be distributed on the following Monday. The Contractor will forward all Treasury medical bill payment files and schedules to DOL no later than close of business on Monday.

· The corresponding payments will be sent on Thursday of the same week. The schedule will allow for the issuance of an RV before the issuance of the corresponding payment to the provider.

· EFT payments will be made available in the payee's bank account on the program's payment date. An electronic RV (ANSI 835) will be issued to authorized providers.

· The payment date must be adjustable. The schedule is mandated by OWCP/Treasury taking holidays into consideration.

The RV sent in advance of a payment to a provider will show all paid and denied bills for that payee, detailing the amount paid for the paid bills and the EOB for denied bills/bill line items. This also includes adjustments, recoupments, and reporting process, as well as the IRS lien payments and reporting processes as provided. RVs will include detailed information including provider ID, claimant ID, check reference number (internal check number, not the Treasury number), RV number, and bill information with a Transaction Control Number (TCN) to help providers identify the amounts paid or denied in each bill by the various programs. The billed charges and paid charges will be displayed in the RV. Denied bills/bill line items will have a reimbursement amount shown as “$0.00.” The RVs will also summarize for a given combination of provider/claimant all the bills processed successfully in the bill payment cycle in each program grouped by payment status of paid or denied. The bottom of the RV will provide the EOB code(s) and description. Any lines of the bill that are denied, or partial-paid, or reflect any reduction of allowed amount due to cutback will provide the EOB code on the corresponding line. The RVs may also contain additional messages or announcements based on the type of provider or bill for selected providers and claimants as and when requested by the DOL (i.e., as part of provider outreach communication). The RVs must also include information that explains the provider's options for repayment, as well as information to notify the provider that unpaid overpayments will be offset/deducted from future payments to that provider.

All RVs will automatically be created and exported to the mailroom for printing, imaging, and retrieval as needed by both internal and external entities. Authorized providers can access the RVs via the CBP Web Portal within one (1) day of the completion of the corresponding payment cycle. All RVs generated from the payment cycle will be stored in the Contractor’s image repository system () according to program-specific periods of time, and be available for online retrieval using several search parameters such as provider ID, Check number, date, etc.

The Contractor will provide sufficient Government approved information to the providers to link payments with specific services in the RV, including but not limited to cross-references to payees and specific Treasury file payments, RV numbers, and program names. Correspondingly, the RV number and internally generated 'warrant' number will be submitted as part of the Treasury Check/EFT files to provide the link from payments to RVs.

3.2.3 1099-MISC Processing A 1099-MISC is a Federal tax form sent to providers that reflects income in the form of payments made according to their Tax ID Number. The 1099-MISC calculates all payments made to a particular Tax ID Number in a calendar year. Providers will receive a separate 1099-MISC for each Program (DFEC, DCMWC, and DEEOIC). The Contractor will provide electronic copies of 1099-MISC forms to the IRS (via data files) and other documentation specified by the Government, and hardcopy 1099-MISC forms to qualifying providers. The generated 1099-MISC's will also be retrievable from the imaging repository by DOL National and District Offices. The requirements, formats, forms and dates associated with filing 1099-MISC data are contained in IRS Publication 1220, which is printed at the beginning of the tax year. The Contractor will review this document upon publication to determine whether any changes have been enacted in how to proceed with filing 1099-MISC forms and data.

The Contractor will issue 1099-MISC forms for all providers based on Tax ID’s that have been paid a net amount of more than $600.00 for the reporting tax year. In addition, a 1099-MISC will be issued, as required by the IRS, for a debt which has been written off. The Contractor will conform to the qualifications and thresholds established by the US Treasury. The current $600.00 amount might change based upon changes in rules. The Central Mailroom’s print generation software will ensure that 1099-MISC forms are generated and issued with payment amounts in the appropriate box, based on Tax ID. The Contractor should understand that in the 1099-MISC process, mostservices are identified as Medical Payments and referenced in the "Medical and Health Care Payments Box, on the 1099-MISC. The Contractor will also ensure that the 1099-MISC forms and information are submitted to the IRS using IRS specified formats and technologies, on or before a date specified by the Government. The Contractor will mail the 1099-MISC forms to the providers by January 15th, or the next business day after January 15th, if January 15th is not a business day, of the year following the tax year being processed. The Contractor will verify that the information submitted is correct according to the 1099-MISC Tax Form Verification Chart (Appendix 7.2). The 1099-MISC Form (Appendix 7.3) and block names must match the Contractor data field name.

3.2.3.1 Process for Resolving 1099 Mailing Issues

The Contractor should understand the importance of the 1099-MISC process, and will immediately notify and report to DOL all issues encountered when distributing the 1099-MISC forms. The Contractor will provide reporting status on the 1099-MISC process to DOL, and immediately notify the Government of any failure that affects the 1099-MISC processing. For program-specific 1099-MISC forms returned as undeliverable, the Contractor will provide a report to DOL detailing each intended mail recipient and attempts to resolve the issue. To reduce the likelihood of undeliverable mail, the Contractor will use National Change of Address (NCOA) software to ensure that the most current address on file with the USPS is used. If a 1099-MISC is returned, the Contractor will verify the address information within CBP and cross-check that against the NCOA database to determine if a change of address has occurred. If there are no discrepancies found between these addresses, the Contractor will make a reasonable effort to contact the provider via phone (using the number on record) or other available means. If the Contractor is still unable to deliver the 1099-MISC, the Contractor will report to DOL the findings and actions taken. The Contractor will reissue 1099-MISC forms when required and authorized by the Government.

3.2.4 Accounts Receivable Flow in Payment Process

An important component of the adjustment process is to support an Accounts Receivable function, in which balances are established for providers who were overpaid. Adjustment processing may result in an overpayment, and needs to be identified by use of interface files to communicate A/R transactions between the CBP and DOL systems. DCMWC uses its own BLAS (Black Lung Accounting System) which includes provider accounts receivable debits, credits, balances which may be due, recoupments, waivers, write-offs, and other adjustments. Below are some of the situations that trigger the use of A/R messages between the systems:

· Notification to DOL that an overpayment exists for a provider, or notification from DOL that a payment was returned from the provider due to overpayment. Pharmacy debts are included in this process where transactions are created as a result of Out-of-Cycle Reversal Transactions, or transactions performed by the Contractor during adjustment processing"

· Acknowledgement received from DOL to create a debt

· Instruction from DOL to begin recoupment of the debt from the provider. DCMWC will send weekly recoupment information to the Contractor prior to the payment cycle. This information will indicate which providers have outstanding overpayment balances and the method and amount of recoupment from the providers since the last payment cycle.

· Payments received or recouped as full or partial payment of the debt

· Notification from the Contractor of post-payment recoupments. This information will include the amount recouped during the week’s payment cycle from each provider, each provider’s summary outstanding balance, RV number, and bill identification number.

· Notification from DOL that a debt is paid in full

The CBP adjustment process will support DOL's recoupment process. In the event an adjustment results in an overpayment, the respective…