Not Just RACs: Providers Must Prepare for MICs Too

What happens when you receive a notification letter

CMS states that providers are audited based on the data analysis done by the Review MICs. Upon receipt of a notification letter, the first thing a provider should do is gather the requested documents as instructed. These requests may include copies of provider records, interviews with providers and office personnel, and access to the facility. Providers will generally have at least two weeks before an audit begins to gather the requested documents.

When gathering these documents, the audit MICs will remain mindful of state requirements concerning record production and may accommodate reasonable requests for extensions for these requests so long as neither the integrity nor timeliness of the audit is compromised.

Within these notification letters will be a primary point of contact at the Audit MIC if there are specific questions about the letter and process. The last step, after receiving a letter involves setting up an entrance conference to communicate relevant information to the provider, including a description of the audit scope and objective. The Audit MIC will set up this conference.

What to do during and/or after the audit

Although some audits will take place at the provider's location, the majority of them will be done at the MICs own office, which is known as a desk audit. CMS policy states that the provider be given the same amount of time to produce requested records as the State Medicaid agency allows in its own provider audits.

Following the audit's conclusion, an exit conference is scheduled through the audit MIC. The purpose of an exit audit, which can be done by phone or in person, is to review a summary of audit findings and potential conclusions. The provider is given the opportunity to comment on these findings, and if the MIC concludes that there was an inappropriate payment, a draft report will be prepared, according to CMS.

Handling the draft report stage

Following CMS approval, the draft report is sent to the state for approval for review and comment, and following that, sent to the provider as well. If deemed necessary, the report is revised accordingly and sent back to the state.

After the review stages of the report, the report is adjusted accordingly, and the provider will be given credit for payments, when applicable. All comments and concerns are addressed and given full consideration, and CMS aims to reach consensus with the state in all situations. CMS, however, has the final say in determining inappropriate payments in any audit. At this point, the draft report is finalized.

What happens during the final stage

During this period, CMS sends the final report to the state, which serves as the official notice of discovery and identification of an overpayment. Under federal law, the state must repay the federal share of the overpayment to CMS within 60 days, whether or not the state recovers, or seeks to recover, the overpayment from the provider.

The provider may exercise whatever appeal or adjudication rights are available under state law when the state seeks to collect the overpayment amount identified in the report, according to CMS.

CMS has put information online to help providers with MICs, including a program provider audit fact sheet, an A to Z review, and procurement and implementation timeline.