NCCI TOC Rebid SOW amendment 000001.docx

CORRECT CODING INITIATIVE (CCI)

MEDICALLY UNLIKELY EDITS (MUE)

STATEMENT OF WORK

I. SCOPE

The contractor shall be responsible for maintaining current correct coding initiative (CCI) edits to control overpayment of Part B, where manipulation of coding leads to inappropriate, increased reimbursement. At a minimum, maintaining CCI, including updating the current edits with any recommended changes or comments and CPT (Current Procedural Terminology) additions, deletions, and revisions.

The contractor shall also be responsible for:

- maintaining the Medically Unlikely Edits (MUEs) (Units-of-Service Edits) to reduce coding and clerical errors for Part B Practitioner and Hospital Outpatient claims and

- as an optional task, pending the availability of funding, assisting the Center for Medicaid, CHIP, and Survey & Certification (CMCS) and the States in meeting the requirements of section 6507 of the Patient Protection and Affordable Care Act (PPACA).

A. Background

The implementation of the Medicare Fee Schedule under Physician Payment Reform required the Centers for Medicare & Medicaid Services (CMS) formally known as the Health Care Financing Administration (HCFA) to adopt uniform payment policies and procedures for all physicians at each Medicare carrier. CMS efforts to respond to this directive included a February 1991 instruction to all carriers to enact a system of edits limiting the overpayment for codes that had been unbundled. The methodology referred to as "rebundling", consisted of a CMS defined list of 87 codes which were defined in the Medicare Carriers Manual (MCM) as being either a Comprehensive (Column 1) or Component (Column II) code.

Component codes are denied if submitted by the same provider, for the same beneficiary, for the same date of service. In 1992, the list of codes was expanded to 252 codes. In August 1994, AdminaStar Federal Inc. (AdminaStar) was awarded the original Correct Coding Initiative (CCI) contract to further develop a list of rebundling edits for Medicare Part B carriers.

On January 1, 1996, Medicare carriers went "live" with CCI edits. The edits consisted of two methodologies, (1) the comprehensive/component table, and (2) the mutually exclusive table. Claims deny because CCI edits do not require the carrier to determine medical necessity. Correct Coding is a separate activity from medical review in that no further clinical judgment is needed to deny a claim. Therefore, the denial can be automated. On April 1, 1997, the CCI file formats were expanded to include a Correct Coding Modifier (CCM) indicator. This indicator specifies which edits may or may not be bypassed with a modifier. The following are the modifier indicators: Category 1 are edits for which no modifier is allowed; Category 2 are edits for which a modifier could be appropriate; and Category 3 are edits which the AMA believes are inappropriate.

Currently, the CCI includes over 100,000 procedure-to-procedure edits. As of December 31, 1999, the CCI has achieved approximately $1 billion in savings towards the Medicare Trust Fund. As a result of the escalating costs of health care, the growing complexity of coding, the growing volume of claims, and the parallel decrease in funding for carrier activities, CMS must continue to control inappropriate payments. Incorporating correct coding methodologies (including the Medically Unlikely Edits), into the carriers' claims processing systems and the OCE, will continue to provide significant savings to the Medicare program.

Medically Unlikely Edits was created in order to ensure that Medicare pays for services appropriately. Congress mandated replacement of cost based hospital outpatient payment with a prospective payment methodology. The Balanced Budget Act of 1999 (BBA) enacted on November 29, 1999, made changes that affected the hospital outpatient payment. OPPS was implemented for services furnished after August 1, 2000. In addition, in order to properly pay for claims, the correct number of units of service should be submitted. Medically Unlikely Edits will prevent payments for incorrect units of service resulting from keystroke errors and other billing errors frequently found on claims submission. It is CMS’ intent to not allow units of service in excess of the Medically Unlikely Edit for a specific HCPCS / CPT code for a single beneficiary on a single date of service.

To further promote correct coding and savings to the Medicare program, Medically Unlikely Edits prevent a provider from billing where it is anatomically impossible (e.g., three leg amputations on the same date of service). Medically Unlikely Edits shall specify the number of times a procedure can be performed on the same date of service by the same provider.

Section 6507 of the PPACA required by September 1, 2010, that CMS: 1) identify those methodologies of the National Correct Coding Initiative (NCCI) which are compatible to claims filed under Title XIX to promote correct coding and to control improper coding leading to inappropriate payments; 2) identify those methodologies that should be incorporated into claims filed under Title XIX for which no correct coding methodologies have been established with respect to Title XVIII; and 3) notify States of the methodologies identified and the process by which States are to incorporate such methodologies for claims filed on or after October 1, 2010. States are required to process Medicaid claims using the NCCI methodologies effective for claims filed on or after October 1, 2010. Not later than March 1, 2011, CMS is required to submit a Report to Congress describing the notice to States and an analysis of the methodologies identified above.

B. Purpose

The purposes of this contract are to:

- maintain and further expand the current correct coding edits to ensure proper coding for Part B and Hospital Outpatient services and,

- as an optional task, pending the availability of funding, enable CMCS and the States to meet the requirements contained in section 6507 of the PPACA.

The contract also continues maintenance of the associated manuals and continuation of the ongoing tasks, such as education to the provider community, replying to correspondence, etc.

The contractor shall provide the necessary personnel, equipment, materials, support / maintenance, supplies and services (unless Government-supplied data, equipment, or supplies are indicated) to accomplish the objectives.

The expected outcomes for this contract are:

· to provide continuous maintenance of the current CCI Comprehensive / Component and CCI Mutually Exclusive edit tables (procedure-to-procedure edits);

· to develop and provide continuous maintenance of Medically Unlikely Edits (Units of Service);

· to provide continuous maintenance of the CCI Coding Policy Manual and the CCI Correspondence Language manual;

· to provide maintenance of existing edits to identify inaccuracies, and any necessary corrections upon approval from CMS;

· to establish and maintain databases to support deliverables related to quarterly replacements of the edits and to provide an audit trail pertaining to all decisions relating to the edits;

· to establish and provide quarterly replacements compatible with CMS requirements for transmission of the data to the carriers claims processing systems;

· to establish and provide an audit trail capable of responding to queries; and

· that the requirements contained in section 6507 of the PPACA are met.

II. REQUIREMENTS

Independently and not as an agent of the Government, the contractor shall furnish all of the necessary services, qualified personnel, materials, equipment, and facilities, not otherwise provided by the Government, as needed to perform the requirements of the SOW.

The following are System and Manual Requirements:

· Claims Processing Manual, Pub 100-04, Chapter 23, Section 20.9

A. General

The contractor shall ensure that all the work performed under the contract is in accordance with requirements identified herein.

In addition to the SOW requirements, CMS is interested in finding and implementing new and innovative approaches for performing CCI activities. The contractor shall implement innovative techniques as appropriate for CCI to be accomplished under this SOW.

Note: Additional tasks not currently identified may be associated with this SOW. CMS reserves the right to expand upon those tasks, as well as the workload identified herein, as required and in the best interests of the Government.

The contractor shall use all appropriate CMS Medicare data, as well as data from other sources.

The CCI Contractor shall accomplish the above objectives by performing the tasks listed below.

APPLIES TO MEDICARE ONLY

Tasks 1 – 14 listed below apply to the Medicare NCCI component of the contract.

Task 1: Initial Meeting / Kickoff Conference

The contractor shall participate in an initial meeting / kickoff conference that shall be held between CMS and the contractor within five calendar days after award of the contract. The contractor and the Contracting Officer’s Technical Representatives (COTR) shall mutually determine the time and date of this conference.

Task 2: Draft and Final Project Plan

The contractor shall submit to the COTR a draft project plan within 10 calendar days after the kickoff conference. A final project plan is due to the COTR within 20 calendar days after the kickoff conference. In addition, as part of the project plan, the contractor shall develop a transition management team to ensure communication, cooperation, consultation, and coordination between the entities is maintained in support of the transition. The project plan shall be revised as necessary to meet continuing changes in the program.

Task 3: Transition Plan

The draft Transition Plan shall be submitted within 5 calendar days after award with a final plan due within 3 calendar days after the kickoff conference. The contractor shall ensure that a transition management team is in place to ensure communication, cooperation, consultation, and coordination between the entities is maintained in support of the transition. The team shall have regular meetings and shall monitor the work of any subgroups during the transition. The contractor shall work with the current contractor (Correct Coding Solutions, LLC) (CCS, LLC) to develop a transition plan that shall specifically detail the steps (with dates) illustrating how all the CCI functions outlined in this contract and functions not excluded from the contract, shall be transitioned to the contractor.

Transition Note: CCS, LLC shall be responsible for the following:

- Submitting the test files for V17.2 (CCI) and V5.2 due 5/02/11.

- The release of the final file for V17.2 (CCI) and V5.2 due 5/17/11.

- Submitting Change Reports for both CCI and MUE due 5/25/11.

- Training the new contractor.

- Transferring the necessary data, correspondence, and any other material associated with CCI/MUE, during the transition period.

At CCS, LLC’s request, CMS (CM) has agreed to exclude CCS, LLC, from any and all phone call conferences for new edits by 5/18/11, to ensure that pending edits are at a manageable level for transition.

Task 4: Correct Coding Edits (Procedure-to-Procedure)

Appendix B, CCI Edits up to Versions 17.1 and 5.1, identifies the existing correct coding edits effective as of April 1, 2011 for the Carrier Part B standard claims processing system. Physicians' Current Procedural Terminology (CPT) is updated once annually. The next issuance will be for the period April 1, 2010 through March 31, 2011. The contractor shall maintain and update the edits/code pairs identified as a result of the CPT code annual updates. In addition, the contractor shall update the edits / code pairs as a result of the issuance of Appendix C, Healthcare Common Procedural Coding System (HCPCS), updates which are published on a continual basis.

The contractor shall update edits/code pairs on a continual basis and report on the status of edit initiatives on a quarterly basis on January 1, April 1, July 1, and October 1 of each year. The changes report shall be due on a quarterly basis; no later than 8 days following the delivery of the final file. The contractor shall also develop a database for tracking the edits/corrections used to produce the CCI. The contractor shall provide CMS with continuous access to the database and the instructions for using it.

The contractor shall also conduct testing of the edit changes on a quarterly basis. Testing shall take place no later than 1 month prior to the quarterly reporting periods in an effort to have the edits go live and be effective in the systems on January 1, April 1, July 1, and October 1 of each year. For each quarterly release, there shall be an electronic test file version referred to as the sequential data set and due no later than 60 days prior to the effective date, and an electronic final file due no later than 45 days prior to the effective date with a possibility of one or more electronic final file to include corrections and/or additions deemed to be necessary for immediate implementation. The electronic version shall include the edits, correspondence reference for each edit, the narrative policy statement, the previous rebundling edit indicator, the modifier indicator and the effective dates for implementation and where appropriate the deletion date.

The contractor shall produce separate final NCCI edit files on a quarterly basis for the NCCI edits incorporated into the Outpatient Code Editor (OCE) for use in the Outpatient Prospective Payment System (OPPS). For each quarterly release, there shall be an electronic final file due no later than 100 days prior to the effective date with a possibility of one or more electronic final files to include corrections and/or additions deemed to be necessary for immediate implementation. Currently the effective date of the NCCI version update in the OCE is one quarter behind the NCCI version update for practitioner services. The electronic version shall include the edits, correspondence reference for each edit, the narrative policy statement, the previous rebundling edit indicator, the modifier indicator and the effective dates for implementation and where appropriate the deletion date.

Task 5: Correspondence

The contractor shall review issues identified in correspondence received from physicians, specialty societies, contractors, etc., and make recommendations pertaining to these issues and provide responses to telephone, email, U.S. Mail inquiries, and all other correspondence. Documentation including preparation of the Comment Review and Response form (EXHIBIT I) and copies of incoming correspondence and the contractor's response shall be provided as needed. The contractor shall respond to correspondence and telephone calls related to the CCI as needed. Currently, the CCI contractor is providing CMS with a copy of all responses to correspondence, via U.S. Mail. Effective, February/March 2011, the contractor shall respond to correspondence, retaining copies and logs of all incoming and outgoing correspondence (emails, U.S. Mail, telephone, etc.), but will no longer need to send a copy to CMS. These documents will be filed / stored at the contractors’ place of business, and if there is a need for CMS to request any of these documents, contractor shall provide the requested documents to CMS, at that time, preferably by U.S. mail (unless otherwise stated).

The contractor shall provide carriers with a set of standardized responses to provider inquiries with respect to the revisions, additions, and/or changes made to the relevant chapters and index of Appendix D, Coding Policy Manual. The contractor shall maintain and update an electronic log of these requests. A draft electronic copy of the log shall be delivered to CMS on April 1 of each year with a final electronic copy of the log due July 15 of each year.

The above requirements shall also apply to Medically Unlikely Edits (Task 10), which has been extended to additionally include HCPCS J codes for drugs and drug related HCPCS C and Q codes (Task 11).

Task 6: Coding Policy Manual

The contractor shall maintain Appendix D, Coding Policy Manual, on a continuous basis and provide a final electronic copy of the Manual for publication no later than August 31 of each year. A draft electronic copy of the manual shall be delivered to CMS for review and comment on July 31 of each year. The manual shall identify changes in CPT code descriptors, CMS coding policy and units of service decisions, CMS Program Transmittals, CMS Manual instructions, Federal Register notices or other items as directed by CMS. In addition, the contractor shall make revisions, additions and changes to the relevant chapters, and index of the coding policy manual prepared under another contract.

The above requirements shall include the Medically Unlikely Edits (Task 10), which has been extended to additionally include HCPCS J codes for drugs and drug related HCPCS C and Q codes (Task 11).

Task 7: Correspondence Language Manual

The contractor shall maintain an annual manual of correspondence language (Appendix E) to be used by the carriers respective to revisions made to the relevant chapters and index of the Coding Policy Manual. The contractor shall add language for units of service. An electronic copy of the draft is due January 31 of each year and the final electronic copy is due February 22 of each year. This manual shall coincide with the CCI Version update due in April.

The above requirements shall also apply to Medically Unlikely Edits (Task 10), which has been extended to additionally include HCPCS J codes for drugs and drug related HCPCS C and Q codes (Task 11).

Task 8: Correct Coding Initiative Education to Provider Community

The contractor shall attend meetings and speak to the AMA (the contractor shall only present to the AMA, if so directed by the CMS workgroup), carrier medical directors, and others as directed by CMS in order to provide information/education about the CCI. Educational materials in electronic copy shall be furnished to the COTR for approval seven (7) days prior to delivery of the education. A report in electronic copy on the educational session provided shall be delivered to the COTR within seven (7) days after the education is delivered.

The above requirements shall not apply to Medically Unlikely Edits (Task 10), which has been extended to additionally include HCPCS J codes for drugs and drug related HCPCS C and Q codes (Task 11).

Task 9: Final Report

The contractor shall submit a draft electronic copy of the Final Report to the COTR by October 31 of each year of the contract with a final electronic copy of the report due November 30.

The above requirements shall also apply to Medically Unlikely Edits (Task 10), which has been extended to additionally include HCPCS J codes for drugs and drug related HCPCS C and Q codes (Task 11).

Task 10: Medically Unlikely Edits

The contractor shall identify, develop, propose, and maintain Medically Unlikely Edits using the Physician’s Current Procedural Terminology (CPT), the Healthcare Common Procedural Coding System (HCPCS), and current CMS policies (as demonstrated through manual changes). The contractor shall analyze claims data for the redevelopment of the originally proposed Medically Unlikely Edits. The contractor receives claims data from Western Integrity Center (WIC), extracts the relevant information, summarizes the data for each HCPCS / CPT code and contractor type, and creates user friendly reports for review of MUE issues with CMS in teleconferences. These edits shall be updated on a quarterly basis in coordination with the other CCI edits. The contractor shall submit two electronic files: one containing Medically Unlikely Edits for use with practitioner and durable medical equipment supplier claims and the other containing Medically Unlikely Edits for use with outpatient hospital claims. Beginning July 1, 2008, the contractor no longer produced historical MUE files at the request of CMS. A different MUE file for the carrier rather than for the FI was developed to include only the most recent MUE record per HCPCS / CPT code. This change in file content is required due to the limitations of shared processing systems and until the shared systems can adequately accommodate multiple records for each HCPCS / CPT code. After the shared systems are fixed, both MUE files forward will contain all records for each code with different effective dates and deletion dates designating specific active periods for the edits. Each electronic file shall include the units of service along with the corresponding procedure code, the correspondence reference for each edit, the implementation date, and the deletion date. For each quarterly release, there shall be an electronic test file version referred to as the sequential data set and due no later than 60 days prior to the effective date, and an electronic final file version due no later than 45 days prior to the effective date with a possibility of one or more electronic final file(s) to include corrections and/or additions deemed to be necessary for immediate implementation.

The delivery of these edits shall be coordinated with the procedure-to-procedure edits.

The contractor shall update Medically Unlikely Edits on a continual basis and report on the status of edit initiatives on a quarterly basis on January 1 (Note: Version 11.0, effective January 1, 2005, does not apply to the Medically Unlikely Edits), April 1, July 1, and October 1 of each year. The changes report shall be due on a quarterly basis, no later than 8 days following the delivery of the final file. The contractor shall also develop a database for tracking the edits/corrections used to produce these edits. The contractor shall provide CMS with continuous access to the database and the instructions for using it. On a quarterly basis the contractor shall provide a listing of active MUE values per HCPCS / CPT code with effective dates for each for CMS reference.

The contractor shall also conduct testing of the edit changes on a quarterly basis. Testing shall take place no later than 1 month prior to the quarterly reporting periods in an effort to have the edits go live and be effective in the systems on January 1 (Note: Version 11.0, effective January 1, 2005, does not apply to the Medically Unlikely Edits), April 1, July 1, and October 1 of each year. For each quarterly release, there shall be an electronic test file version referred to as the sequential data set and due no later than 60 days prior to the effective date, and an electronic final file version due no later than 45 days prior to the effective date with a possibility of one or more electronic final file(s)) to include corrections and/or additions deemed to be necessary for immediate implementation. The electronic version shall include the edits, corresponding procedure code, the correspondence reference for each edit, and the effective dates for implementation and where appropriate the deletion date. Additionally for each quarterly release, the contractor shall produce a file of published MUE values for practitioner / DME supplier services and for outpatient hospital services due no later than two days prior to the effective date of the MUE version update. The file shall contain the HCPCS / CPT code and the MUE value. The contractor shall submit two MUE publication files to CMS / OIS for posting on the CMS website.

Task 11: Medically Unlikely Edits (MUEs) for HCPCS J codes for drugs and drug-related HCPCS C and Q codes

The Medically Unlikely Edits (MUEs) shall be developed for HCPCS J codes for drugs and drug-related HCPCS C and Q codes. The contractor shall expand medically unlikely edits (MUEs) for existing J codes and other HCPCS drug codes for use at MACs, Carriers, Fiscal Intermediaries, and DME MACs subject to limitations imposed by the current processing systems. The contractor shall utilize the MUE review-and-comment process to allow national healthcare organizations (NHOs) to comment about the edits. The contractor shall work with the CMS MUE Technical Workgroup to review, assign and implement the MUEs, integrating them into the current MUE files used by CMS claims processing contractors. (Note: The contractor shall meet, as scheduled (weekly, monthly), via teleconference to work with the MUE Technical Workgroup in the review, discussion, assignment, and implementation procedures. The contractor shall occasionally or on an ad hoc basis, meet with the CMS MUE Administrative Workgroup to discuss MUE administrative issues that arise from the technical meetings, correspondence, email, U.S. mail, telephone, or any other source.) The contractor shall utilize claims data from the National Database contractor, shall extract the relevant information, shall summarize the data for each HCPCS / CPT code and contractor type, and shall create user friendly reports for review of MUE issues with CMS in teleconferences. After each implementation phase of the MUEs for J codes (including drug-related C and Q codes) and as soon as data is available for those implemented MUEs in each phase, the contractor shall produce a quarterly report (MUE Report on Vulnerabilities / Savings to the Medicare Trust Fund) of the analysis and impact of these edits. This report shall capture the potential savings to the Medicare Trust Fund, as well as other factors that show the impact of these edits. In addition to the report, the contractor shall also provide charts, graphs, and other formats necessary to provide an accurate and valuable picture of the effects of these MUEs. Since MUEs for these codes for suppliers may differ from MUEs for these codes for practitioner claims, the contractor shall develop, if required, a separate MUE file for DME MACs. This third MUE file shall have deliverable dates the same as the deliverable dates for practitioner and hospital outpatient MUE files. The contractor shall develop MUEs for new and modified J codes and other HCPCS codes as they become active codes. The contractor shall incorporate this process into the ongoing development of MUEs for other new and modified HCPCS / CPT codes. The contractor shall respond to correspondence about J codes and other HCPCS drug codes in the same manner as it does for MUEs for other HCPCS / CPT codes. This correspondence shall be incorporated into the correspondence log.

Task 12: NCCI Edits Derived from Publications of National Healthcare Organizations and Special Initiatives

The contractor shall review and monitor publications of National Healthcare Organizations (NHOs) to identify potential NCCI edits. Publications to be evaluated include but are not limited to the American Medical Association’s CPT Assistant, American Hospital Association’s HCPCS Coding Clinic, coding manuals of NHOs (e.g., American Academy of Orthopaedic Surgeons, Society of Interventional Radiology, American College of Radiology), NHO published coding FAQs or guidance, and NHO internet coding FAQs or guidance. The contractor shall identify NCCI edit initiatives to complement currently active NCCI edits. Potential NCCI edits identified through these methodologies will be evaluated, released for review and comment to appropriate NHOs, and implemented through the same process currently utilized for other NCCI edits.

Task 13: Add-On Code Edits

The contractor shall identify all add-on codes in the CPT Manual and divide them into two groups. The contractor shall also include an evaluation of any HCPCS Level II codes for add-ons or primary codes. Group I add-on codes are codes for which the CPT Manual specifically identifies the primary codes with which these codes must be reported. The contractor shall develop an edit file listing in column one the add-on code and in column two the primary codes. The contractor shall assist CMS in developing an instruction to A/B MACs (practitioner claims) requiring them to deny payment for add-on codes listed in column one if one of the primary codes listed in column two is not payable for the same date of service. This instruction will be similar to the Identical Letter issued by CMS in December 1996 to contractors on the same issue but will update the list of add-on codes and primary codes. Group II add-on codes are codes for which the CPT Manual does not specifically identify the primary codes. Since A/B MACs (outpatient hospital services claims) do not currently have edits requiring add-on codes to be paid only if an appropriate primary code is also payable, The contractor shall provide the same file to the CMS OPPS staff so that they can evaluate the program vulnerability due to this issue and decide whether to implement appropriate edits. The contractor shall update the add-on code file annually incorporating annual additions, deletions, and modifications to CPT codes. An electronic copy of the add-on code edit report shall be delivered to CMS by March 31 each year.

Task 14: Monthly Progress Reports

The contractor shall submit monthly progress reports by the 20th of each month (or the next business day) for the previous month's effort.

OPTIONAL Applies to MEDICAID TASKS Only (pending the availability of funding)

Tasks 15 – 34 listed below apply to the optional Medicaid NCCI component of the contract.

Task 15: Kickoff Meeting

The contractor shall participate in a kickoff meeting with CMS at CMS’s Baltimore, MD, Central Office location within five calendar days after award of the contract. The contractor and the Contracting Officer’s Technical Representative (COTR) shall mutually determine the time and date of this conference.

The contractor shall develop and deliver a presentation at the kickoff meeting that includes the following:

- introduction of key personnel;

- an overview of the technical approach;

- a description of the Transition Plan;

- a description of the Project Management Plan (PMP); and

- other topics as directed by CMS.

Task 16: Transition Plan

The contractor shall prepare and submit to CMS a plan that, at a minimum, specifically details the steps (with dates) illustrating how all the CCI functions outlined in this contract shall be transitioned to the contractor. The plan shall include all the necessary information broken out by project phases (i.e., preparation, transfer, and fully operational) and workload.

Task 17: Project Management Plan

The contractor shall prepare and submit to CMS a detailed Project Management Plan (PMP) for each year of the performance period. The initial PMP is due at the kickoff meeting. The first revised PMP is due five business days after the kickoff meeting. The contactor shall update the PMP monthly thereafter.

The project plan shall cover each task of the requirements for this contract and shall highlight each step of implementation of this contract. The project plan shall include, at a minimum the following information:

- each Task and its implementation;

- staff and hours expected for completion of each Task and / or delivery date and timetable;

- allocation and management of resources;

- project organization;

- key milestones signifying successful completion of each Task;

- periodic internal assessment / progress reports planned; and

- description on how the contractor intends to use medical specialty societies, State Medicaid Directors, State Medicaid Medical Directors, and others in an advisory capacity with regard to proposed edits.

Task 18: Monthly Progress Reports

The contractor shall prepare and submit to CMS each month a progress report for the Medicaid program. The report shall be submitted electronically via email attachment on the 20th or next business day of each month. The reports shall include, at a minimum:

- the report number;

- the due date of the report; the

- date the report was submitted;

- the month and year of the report;

- the scope of the work;

- monthly activities and accomplishments for both projected tasks and actual tasks performed;

- consideration of comments related to the CCI Versions (whichever is in place) from the AMA, specialty societies, CMS components, carrier medical directors, individuals directed by CMS;

- preparation of materials for comments requiring discussion with CMS staff, as directed by CMS;

- preparation of updates / total replacements of electronic media required by CMS Central Office for quarterly CCI replacement versions to carrier claims systems, as directed by CMS;

- reports on the results of provider education and trips during the performance of the contract, as directed by CMS;

- constraints preventing the accomplishment or timely completion of any of the tasks;

- activities of the Quality Assurance Program; and

- comment Review and Response form.

The above requirements shall also apply to Medically Unlikely Edits.

Task 19: Annual Reports

The contractor shall prepare and submit to CMS an annual summary report each year for the Medicaid program. At a minimum, the report shall include a summary of the previous year's activities and lessons learned.

The above requirements shall also apply to Medically Unlikely Edits.

Task 20: Reserved

Task 21: Medicaid NCCI Methodologies

The contractor shall:

- identify those methodologies of the NCCI which are compatible to claims filed under Title XIX to promote correct coding and to control improper coding leading to inappropriate payments;

- assist CMS in the analysis and feasibility of the development of the NCCI methodologies for Medicaid, including for types and sites of services covered by Medicaid that are not covered by Medicare;

- review HCPCS T codes and use an extract of Medicaid Statistical Information System (MSIS) to develop any appropriate MUEs for these codes; and

- develop in cooperation with CMS “Standard National Medicaid NCCI Methodology” (NMNCCI) files. This may include modifying Medicare edit files for the NCCI methodologies to be compatible with Medicaid programs.

Task 22: Electronic Correct Coding (Procedure-to-Procedure) Edits and Electronic Medically Unlikely (Units-of-Service) Edits

The contractor shall prepare and submit to CMS for each calendar quarter an electronic version that shall include all of the Correct Coding Edits that are appropriate for, and compatible with, Medicaid, correspondence reference for each edit, the narrative policy statement, the modifier indicator and the effective date for implementation and where appropriate the deletion date. For each quarterly release, there shall be a test file version referred to as the sequential data set and due no later than 20 days prior to the effective date, and a final file due no later than 15 days prior to the effective date, with a possibility of one or more final file to include corrections and / or additions deemed to be necessary for immediate implementation.

The electronic version for each calendar quarter shall include all of the Medically Unlikely Edits that are appropriate for, and compatible with, Medicaid with all new, revised, and deleted edits. Each electronic file shall include the units of service along with the corresponding procedure code, the correspondence reference for each edit, the implementation date, and the deletion date. For each quarterly release, there shall be an electronic test file version referred to as the sequential data set and due no later than 20 days prior to the effective date, and an electronic final file version due no later than 15 days prior to the effective date, with a possibility of one or more electronic final file(s) to include corrections and / or additions deemed to be necessary for immediate implementation.

The Medicaid NCCI files shall be synchronous with the Medicare NCCI files.

The contractor shall prepare and submit to CMS the Medicaid NCCI files in three formats: ASCII.TXT, Excel 2007 (.xlsx), and tab-delimited text (.txt) with column headings.

Task 23: Quarterly Updates

The contractor shall:

- work with CMS to update edits on a quarterly basis and to ensure that State Medicaid programs and claims contractors can utilize the quarterly Medicaid NCCI edits and MUEs;

- develop, maintain, and deliver to CMS on a quarterly basis edit files for each of the Medicaid NCCI methodologies in three file formats: ASCII.TXT, Excel 2007 (.xlsx), and tab-delimited text (.txt) with column headings;

- deliver an electronic test file version of the Medicaid NCCI methodologies, referred to as the sequential data set, no later than 20 days prior to the effective date, i.e., the first day of each calendar quarter, and an electronic final file version due no later than 15 days prior to the effective date, with a possibility of one or more electronic final file(s) to include corrections and / or additions deemed to be necessary for immediate implementation;

- make available the NCCI methodology files for each of the NCCI methodologies for Medicare and Medicaid claims processing contractors to download into their claims processing systems;

- define the rules that must be applied for processing Medicare and Medicaid claims;

- establish rules for Medicare and Medicaid programming logic to adjudicate claims; and

- provide revisions and updates, as needed, to the documents on the CMS Medicaid NCCI website (http://www.cms.gov/MedicaidNCCICoding/), including the following documents:

“Nature and Structure of Medicaid’s NCCI” “Overview” “Frequently Asked Questions” “NCCI File Names and Formats, Algorithms for Processing Claims, and Characteristics of Edits” “Medicaid NCCI Coding Policy Manual” “COTS Software” “NCCI Appeals” “Medicaid Correspondence Language Manual”

“CLEID”

“Medicare Modifier 59 Article” “NCCI and MUE Edits”.

Task 24: Add-On Code Edits

The contractor shall prepare and submit to CMS a report that, at a minimum, shall contain each add-on code with each of its respective primary codes with which it should be reported. An electronic version shall be provided via email using the word processing format that is the CMS standard at the time the copy is provided.

Task 25: Change Report on CCI Edits and MUEs

The contractor shall prepare and submit to CMS a report that, at a minimum, shall include all new, deleted, and revised procedure-to-procedure edits for each change recommendation and CPT / HCPCS update. Each edit shall be accompanied by the rationale for developing it.

The report shall also include the Medically Unlikely Edits (MUEs) with all new, revised, and deleted edits. Each edit shall be accompanied by the rationale for developing it. The report shall additionally include the new, revised, and deleted MUEs for drug HCPCS J codes and drug related HCPCS C and Q codes.

In addition, the report shall include a status on the result of testing for final implementation of the edits. This report shall be due on a quarterly basis, no later than eight days following the delivery of the final file.

Task 26: Quarterly MUE Reports for the Medicaid Program

On a quarterly basis, the contractor shall produce a report of the analysis and impact of the implemented MUEs on the Medicaid program. The contractor shall use claims data received from the Medicaid Statistical Information System (MSIS) to estimate savings from these MUEs. The contractor shall identify the MUEs that are vulnerable to fraud and abuse in the Medicaid program. The MUEs identified will be used in Federal and State efforts to combat fraud and abuse in the Medicaid program. The report shall contain information displayed in graphs, charts, and other formats necessary to provide an accurate and valuable picture of the effects of these MUEs.

Task 27: CMS Medicaid NCCI Workgroup

The contractor shall identify and research issues for, and provide support, assistance, and agendas to, the CMS Medicaid NCCI Workgroup concerning the Medicaid NCCI methodologies. This shall include how issues and changes in the Medicare NCCI methodologies may affect the Medicaid NCCI methodologies and vice versa.

Task 28: Work with State Medicaid Programs

The contractor shall participate with CMCS and States as a group in conference calls and meetings concerning the Medicaid NCCI methodologies, the process by which claims will incorporate these methodologies, and any other pertinent information deemed necessary by CMCS.

The contractor shall work with CMCS and States as a group to discuss, vet, and resolve technical issues that pertain to the implementation and utilization of the NCCI methodologies in State Medicaid programs that are common among many States at the national level.

The contractor shall provide guidance to CMCS and to the States as a group about the Medicaid NCCI methodologies, including file characteristics and claims processing rule requirements, so that State Medicaid claims processing systems can be programmed to receive the Medicaid NCCI methodologies files and process claims correctly.

The contractor shall work with CMCS to develop policy guidance documents on the Medicaid NCCI methodologies, as needed. This guidance may include a Federal regulation, another State Medicaid Director letter, and / or alternatives, as designated by CMCS. Specifically, the contractor shall work with CMCS to provide information in narrative form in a document compatible with Word 2007, which may include background on the NCCI, the Medicaid NCCI methodologies, the processes by which State Medicaid claims processing systems can incorporate these methodologies, and any other pertinent information deemed necessary by CMCS.

The contractor shall provide, contribute to, and participate in education, training, and technical assistance to all States as a group and / or with groups of States in various formats, such as conference calls and webinars.

The contractor will work with State Medicaid Directors, State Medicaid Medical Directors, State Medicaid contractors, and CMS to update NCCI edits and MUEs on a regular, continuous basis.

The contractor shall obtain and respond to feedback received directly, and through CMS, from State Medicaid Directors and State Medicaid Medical Directors identifying issues impacting the implementation of NCCI edits and MUEs and updates to the edits. The contractor must issue letters to State Medicaid Directors and State Medicaid Medical Directors requesting input about how the Medicaid NCCI / MUE files should differ from Medicare NCCI / MUE files based on variations in individual State laws and administrative rules. The contractor shall analyze and utilize recommendations from State Medicaid Directors and State Medicaid Medical Directors on improvements to the NCCI edits and / or MUEs applicable to State Medicaid Programs and changes to edits based on variations in individual State laws and administrative rules, when and where appropriate, as determined by CMS.

Task 29: Analysis of, and Reports on, Advance Planning Documents (APDs) Submitted by States on Implementation of the NCCI in State Medicaid Programs

The contractor shall summarize, analyze, and report on Advance Planning Documents (APDs) submitted by States on implementation of the NCCI in State Medicaid Programs. The purposes of the analyses are to:

- describe how States are implementing the NCCI in their Medicaid programs and

- identify:

- problems, issues, and their sources in implementation;

- patterns in implementation;

- possible changes in the Medicaid NCCI methodologies (e.g., edits); and

- State needs for technical assistance in implementing the NCCI in their Medicaid programs.

The contractor shall prepare and submit to CMS on a monthly basis a report on its findings.

Task 30: Analyses of, and Guidance Documents on, Medicaid NCCI Policy Issues

The contractor shall analyze policy issues concerning the Medicaid NCCI methodologies. The policy issues that the contractor will analyze will include the deactivation of Medicaid NCCI edits and MUEs by State Medicaid programs, the nature of the appeals process in the Medicaid NCCI methodologies to be implemented by State Medicaid programs, and other policy issues designated by CMS.

The contractor shall also prepare and submit to CMS a guidance document for State Medicaid programs on each policy issue analyzed.

Task 31: NCCI Edits Derived from Publications of, and Feedback from, National Health Care Organizations

The contractor shall obtain / incorporate feedback about required modifications from the American Medical Association, the American Hospital Association, and other national health care organizations (NHOs). In obtaining feedback, the contractor must utilize the same review and comment process with national health organizations that the contractor currently utilizes for Medicare NCCI and MUE edits.

Additionally, the contractor must issue letters to national health care organizations requesting input about how Medicaid NCCI / MUE files should differ from Medicare NCCI / MUE files based on variations in individual State laws and administrative rules.

The contractor shall review and monitor publications of National Health Care Organizations (NHOs) to identify potential NCCI edits. Publications to be evaluated include but are not limited to the American Medical Association’s CPT Assistant, American Hospital Association’s HCPCS Coding Clinic, coding manuals of NHOs (e.g., American Academy of Orthopaedic Surgeons, Society of Interventional Radiology, and American College of Radiology); NHO published coding FAQs or guidance, and NHO internet coding FAQs or guidance.

The contractor shall identify NCCI edit and MUE initiatives to complement currently active NCCI edits and MUEs. Potential NCCI edits and MUEs identified through these methodologies will be evaluated, released for review and comment to appropriate NHOs, and implemented through the same process currently utilized for other NCCI edits and MUEs.

The contractor shall analyze and utilize, when and where appropriate, as determined by CMCS, input from NHOs on how Medicaid NCCI methodologies should differ from Medicare NCCI methodologies based on variations in individual State laws and administrative rules.

The contractor shall utilize the MUE review-and-comment process to allow NHOs to comment about the edits.

Task 32: Communications

The contractor shall review issues identified in correspondence received from physicians, specialty societies, contractors, etc., and make recommendations pertaining to these issues and provide responses to telephone, email, U.S. Mail inquiries, and all other correspondence. Documentation including preparation of the Comment Review and Response form and copies of incoming correspondence and the contractor's response shall be provided as needed. The contractor shall respond to correspondence and telephone calls related to the CCI as needed. The contractor shall retain copies and logs of all incoming and outgoing correspondence (emails, U.S. Mail, telephone, etc.), but will not need to send a copy to CMS. These documents will be filed / stored at the contractor’s place of business, and if there is a need for CMS to request any of these documents, the contractor shall provide the requested documents to CMS, within 48 hours, preferably by U.S. mail (unless otherwise stated).

The contractor shall provide Medicaid fiscal agents with a set of standardized responses to provider inquiries with respect to the revisions, additions, and / or changes made to the relevant chapters and index of the Medicaid Coding Policy Manual. The contractor shall maintain and update an electronic log of these requests. A draft electronic copy of the log shall be delivered to CMS on April 1 of each year with a final electronic copy of the log due July 15 of each year.

The above requirements shall also apply to Medically Unlikely Edits (MUEs), which has been extended to additionally include HCPCS J codes for drugs and drug related HCPCS C and Q codes.

Task 33: Medicaid Coding Policy Manual

The contractor shall develop, revise, update, and submit to CMS the National Correct Coding Initiative Policy Manual for Medicaid Services on a regular basis, as needed.

At a minimum, this Manual shall include the policy, e.g., the narrative description or rationale for each CCI edit, along with an explanation of the modifiers that can and cannot be used with the codes. The electronic version shall be provided via email using the word processing format that is the CMS standard at the time the copy is provided.

The above requirements shall also apply to Medically Unlikely Edits, which have been extended to additionally include HCPCS J codes for drugs and drug related HCPCS C and Q codes with the exception of modifiers.

The Manual shall specifically address Medicaid services, providers, Federal Medicaid payment policies, etc.

Task 34: Medicaid Correspondence Language Manual

The contractor shall develop a Correspondence Language Manual for Medicaid based on the Correspondence Language Manual for Medicare and revise and update this manual on a regular basis, as needed.

At a minimum, this manual shall include accurate examples and procedure codes and any updates to the General Correspondence Language, along with the Correspondence Language Policy / Example Number. The electronic version shall be provided via email using the word processing format that is the CMS standard at the time the copy is provided.

The above requirements shall also apply to Medically Unlikely Edits, which have been extended to additionally include HCPCS J codes for drugs and drug-related HCPCS C and Q codes.

B. REPORTING REQUIREMENTS

All written documents for this project shall be delivered to the COTR in an electronic version (see the deliverable schedule in Appendix A) via email. The COTR may request hard copies as necessary. All electronic files shall be submitted in a format that is compatible with Microsoft Office 2007. This is subject to change, and the contractor shall be prepared to submit deliverables in any new CMS standard.

The COTR shall provide the contractor with comments on reports within two (2) weeks of receipt. If no response is received within two (2) weeks for draft reports, the contractor shall assume that the draft report is approved for development of final reporting.