times for each type of bill are displayed for each intermediary in tables 4 and 5 of this report. Also collected centrally are data on errors found in bills submitted by individual intermediaries. Bills found to contain errors are rejected by SSA and sent back to the intermediaries for correction. The ratio of bills with errors to total bills submitted is used as an indicator of performance in the area of quality of bill processing. These rates are published quarterly in tables 7 and 8 of the Errors in Health Insurance Bills Processed by SSA report (Exhibit 5). A description of the various types of error rates can be found in the report's appendix. Another major activity intermediaries engage in is the auditing of provider cost reports. For purposes of measuring the timeliness in settling cost reports, a performance indicator is calculated for each intermediary comparing the total number of settlements with cost reports due for the three most recent accounting periods. Information used in these calculations is obtained from the Provider Audit Activity Report, Form SSA-1822, submitted by Part A intermediaries monthly. These calculated performance indicators are published quarterly in the Medicare Part A Intermediary Provider Audit Activity Report (see last table of Exhibit 6). The Bureau of Health Insurance is developing procedures for measuring the accuracy of the cost report settlement process in addition to this timeliness measure. All of these performance indicators are used by BHI regional offices to help identify areas in which carriers or intermediaries need to make improvements. They provide important leads for followup in the Contractor Inspection and Evaluation Program (CIEP). The objective of CIEP is to improve contractor performance through a system of review and appraisal of the performance of Medicare functions by each contractor. This is done by the BHI regional office developing and operating a well-organized plan of contractor surveillance directed toward identifying and following up on improvement opportunities. Also in most cases, a contractor's daily operations are monitored by onsite representatives of the Bureau whose responsibility it is to assist the contractor in identifying problem areas and instituting corrective action. In those cases where excessive workload causes the problem, reassignment of geographical portions of the claims processing workloads is given consideration. This type of action has already been utilized in the past. The ultimate action, of course, is termination of contract. Attachments: (Exhibits 1 to 6). [Since the attachments are voluminous and became rapidly dated, they are deleted from the hearing record.] Attachment 4 CONTRACTOR AGREEMENTS NOT RENEWED As indicated below, the following agreements with intermediaries and carriers have been subject to nonrenewal, termination, or modification since 1966: INTERMEDIARY AGREEMENTS NOT RENEWED The nonrenewal date is shown in parentheses. Hamilton Life Insurance Co., of New York: Agreement terminated by mutual consent (5-31-68). Community Health Association (Highland Park, Michigan): 1 Agreement terminated by mutual consent (6-30-69). New York State Department of Health: Agreement terminated by mutual consent (10-31-69). Cooperative de Salud de Puerto Rico:1 Agreement terminated by mutual consent (12-31-69). The contractor was replaced by Cooperativa de Seguros de Vida de Puerto Rico. Blue Cross of Puerto Rico: Agreement not renewed due to inadequate conformance to program requirements (6-30-72). The contractor was replaced by Florida Blue Cross. Inter-County Hospitalization Plan, Inc.: Agreement not renewed due to inadequate performance in the audit/reimbursement area (6–30–75). 1 Upon notification of the nonrenewal of a provider's intermediary, the provider could nominate another available intermediary. CARRIER AGREEMENTS NOT RENEWED The nonrenewal date is shown in parentheses. Nebraska State Department of Public Welfare: Agreement terminated by mutual consent (5-5-67). The contractor was replaced by Mutual of Omaha. Pilot Life Insurance Company: Agreement terminated by mutual consent (6-30-69). The contractor was replaced by the Prudential Insurance Company of America. John Hancock Mutual Life Insurance Company: Agreement terminated due to inadequate conformance to program requirements (4-5-70). The contractor was replaced by the Prudential Insurance Company of America. Medical Mutual of Cleveland, Inc.: Agreement terminated due to inadequate conformance to program requirements (6-30-71). The contractor was replaced by Nationwide Mutual Insurance Company. REDUCTION IN SERVICE AREAS OF CARRIERS The effective date is shown in parentheses. California Physicians' Service: Jurisdiction for seven counties was transferred to Occidential Life Insurance Co. (12-31-69). The purpose for the change was to bring about a greater balance of workloads between the two Medicare carriers in California and to provide improved service to beneficiaries, physicians, and other suppliers of services. Illinois Medical Service: Jurisdication for four counties was transferred to The Continental Casualty Company (6-30-71). The purpose for the change was to bring about a greater balance of workloads between the two Medicare carriers in Illinois and to provide improved services to the public. Blue Shield of Florida, Inc.: Jurisdiction for two counties was transferred to Group Health, Inc. (6-30-75). The purpose for the change was to ameliorate the effects of a substantial increase in workload and program administration problems which are unique to the State. ATTACHMENT 5 1975 CONTRACTS HOSPITAL INSURANCE BENEFITS FOR THE AGED AND DISABLED (Agreement with Intermediary Pursuant to Sections 1816 and 1842 of the Social Security Act, as Amended) AGREEMENT NO. AGREEMENT The Secretary of Health, Education, and Welfare and The Blue Cross Association (To carry out the provisions of sections 1816 and 1842 of the Soocial security Act as amended) INTRODUCTION The Secretary of Health, Education, and Welfare, hereinafter referred to as the Secretary and the Blue Cross Association, hereinafter referred to as the Intermediary, pursuant to the authority contained in sections 1816 and 1842 of the Social Security Act, as amended (providing for the use of private organizations to facilitate payments required to be made under Part A and Part B of Title XVIII of the Social Security Act, as amended), hereby agree to the following: Article INDEX TO BCA AGREEMENT Title Page No. I Definitions and Delegations.... II Functions and Duties to be Performed by Intermediary III Functions and Duties to be Performed by the Secretary IV Payment for Covered Services... V Advance of Funds and Transfer of Funds Through Letter of Credit. 1 1 3 5 6 XII Confidential Nature and Limitation of Use of Information and Records 10 10 XIV Prior Approval and Prior Notice for Subcontracting and Data Processing 11 XV Subcontracting. 12 XVI Data Processing.. 14 XVII Nomination, or Withdrawal of Nomination by a Provider of Services.. 14 14 XXV Modification and Termination of Agreement XXVI Termination of Agreement.... XXVII Continuance of Functions and Duties Under Prior Agreement 17 17 18 Article I DEFINITIONS AND DELEGATIONS For the purposes of this agreement A. The term "Secretary" means the Secretary of Health, Education, and Welfare or his delegate. B. The term "Act" means the Social Security Act, as amended from time to time. C. The term "provider of services" means an institution, facility, or agency so designated on a list furnished by the Secretary as a participating provider of services. D. The term "nonparticipating provider of services" means an institution, facility, or agency so designated by the Secretary. E. The term "emergency hospital" means an institution which the Secretary has determined to be eligible for payments as authorized by sections 1814 (d) (1), 1814(f), and 1835(b)(1) of the Act. F. The term "eligible individual" means an individual to whom payment may be made pursuant to sections (i) 1814 (d)(2), (ii) 1832(a) (1) for medical and other health services described in 1861(s) (2) (B) and (C), 3 through 9 inclusive when furnished by a nonparticipating provider of services, and (iii) 1835(b) (2) and 1835(c) of the Act. G. The term "covered services" means the items or services for which payment may be made under sections 1812 (a) and 1832(a) of the Act except items or services for which payments may not be made by reason of section 1862 of the Act. H. The term "Plan" means a Blue Cross organization which becomes a subcontractor of the kind referred to in Article II hereof. I. The term "General Instructions" means manuals and written instructions of general application to Carriers or Fiscal Intermediaries issued by the Secretary pursuant to the Act in respect to matters covered by this agreement. J. The term "subcontract" means any contract, agreement, purchase order or lease (including leases of real property) to obtain space, supplies, equipment, or services under this agreement; the term "subcontractor" means any holder of one or more subcontracts. K. The term "Federal Procurement Regulations (FPR)," as used in this agreement, means those Parts of the Federal Procurement Regulations to which reference is made hereinafter, as in effect on the effective date of this agreement. L. Responsibility for the administration of this agreement having been delegated by the Secretary to the Commissioner of Social Security, who has further delegated to the Deputy Commissioner of Social Security and the Director of the Bureau of Health Insurance the authorization to administer matters covered under this agreement, any written statement with respect to matters covered by this agreement by (1) such Commissioner, Deputy Commissioner, or the Director, Bureau of Health Insurance, or (2) the Health Insurance Regional Representative and such other positions as such Commissioner authorizes (but only with respect to matters specifically covered by such authorization) shall have the same force and effect as though issued by the Secretary. With respect to the positions designated in clause (2) of the preceding sentence, the Commissioner of Social Security shall furnish the Intermediary a list of such positions and the matters with respect to which they are authorized to act. Article II FUNCTIONS AND DUTIES TO BE PERFORMED BY INTERMEDIARY A. The Intermediary shall: 1. Make determinations as to whether the services provided an individual are covered services and of the amounts of payments required to be made to each provider of service, to each nonparticipating provider of service, to each emergency hospital and to each eligible individual in accordance with the provisions of the Act, Regulations promulgated pursuant thereto, and General Instructions. 1 76-614 O 76 - 12 |