80 FR 79343 - Medicare Program; Request for Information Regarding the Awarding and the Administration of Medicare Administrative Contractor Contracts

DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services

Federal Register Volume 80, Issue 244 (December 21, 2015)

This request for information solicits public comment on the processes and procedures that we could use to leverage new legal authorities to-- incentivize and reward exceptional Medicare Administrative Contractor (MAC) contract performance; publish performance information on each MAC, to the extent permitted by law; and make MAC jurisdictional changes.

[Federal Register Volume 80, Number 244 (Monday, December 21, 2015)]
[Notices]
[Pages 79343-79345]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2015-32027]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

[CMS-1653-NC]


Medicare Program; Request for Information Regarding the Awarding 
and the Administration of Medicare Administrative Contractor Contracts

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Request for information.

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SUMMARY: This request for information solicits public comment on the 
processes and procedures that we could use to leverage new legal 
authorities to-- incentivize and reward exceptional Medicare 
Administrative Contractor (MAC) contract performance; publish 
performance information on each MAC,

[[Page 79344]]

to the extent permitted by law; and make MAC jurisdictional changes.

DATES: To be assured consideration, written or electronic comments must 
be received at one of the addresses provided below, no later than 5 
p.m. on February 19, 2016.

ADDRESSES: In commenting, refer to file code CMS-1653-NC. Because of 
staff and resource limitations, we cannot accept comments by facsimile 
(FAX) transmission.
    You may submit comments in one of four ways (please choose only one 
of the ways listed):
    1. Electronically. You may submit electronic comments on this 
regulation to http://www.regulations.gov. Follow the ``Submit a 
comment'' instructions.
    2. By regular mail. You may mail written comments to the following 
address ONLY: Centers for Medicare & Medicaid Services, Department of 
Health and Human Services, Attention: CMS-1653-NC, P.O. Box 8013, 
Baltimore, MD 21244-8013.
    Please allow sufficient time for mailed comments to be received 
before the close of the comment period.
    3. By express or overnight mail. You may send written comments to 
the following address ONLY: Centers for Medicare & Medicaid Services, 
Department of Health and Human Services, Attention: CMS-1653-NC, Mail 
Stop C4-26-05, 7500 Security Boulevard, Baltimore, MD 21244-1850.
    4. By hand or courier. Alternatively, you may deliver (by hand or 
courier) your written comments ONLY to the following addresses: a. For 
delivery in Washington, DC--Centers for Medicare & Medicaid Services, 
Department of Health and Human Services, Room 445-G, Hubert H. Humphrey 
Building, 200 Independence Avenue SW., Washington, DC 20201.

    (Because access to the interior of the Hubert H. Humphrey 
Building is not readily available to persons without Federal 
government identification, commenters are encouraged to leave their 
comments in the CMS drop slots located in the main lobby of the 
building. A stamp-in clock is available for persons wishing to 
retain a proof of filing by stamping in and retaining an extra copy 
of the comments being filed.)

    b. For delivery in Baltimore, MD--Centers for Medicare & Medicaid 
Services, Department of Health and Human Services, 7500 Security 
Boulevard, Baltimore, MD 21244-1850.
    If you intend to deliver your comments to the Baltimore address, 
call telephone number (410) 786-9994 in advance to schedule your 
arrival with one of our staff members.
    Comments erroneously mailed to the addresses indicated as 
appropriate for hand or courier delivery may be delayed and received 
after the comment period.
    FOR FURTHER INFORMATION CONTACT: Debra Bowman, (410) 786-4941. 
Phyllis Atkins-Mackey, (410) 786-9362. Megan Martino, (215) 861-4425. 
Sue Pelella, (215) 861-4245.

SUPPLEMENTARY INFORMATION: 
    Inspection of Public Comments: All comments received before the 
close of the comment period are available for viewing by the public, 
including any personally identifiable or confidential business 
information that is included in a comment. We post all comments 
received before the close of the comment period on the following Web 
site as soon as possible after they have been received: http://www.regulations.gov. Follow the search instructions on that Web site to 
view public comments.
    Comments received timely will also be available for public 
inspection as they are received, generally beginning approximately 3 
weeks after publication of a document, at the headquarters of the 
Centers for Medicare & Medicaid Services, 7500 Security Boulevard, 
Baltimore, Maryland 21244, Monday through Friday of each week from 8:30 
a.m. to 4 p.m. To schedule an appointment to view public comments, 
phone 1-800-743-3951.

I. Background

    For several decades after Medicare's inception in 1966, private 
health care insurers, known as Part A Fiscal Intermediaries (FI) and 
Part B carriers, processed medical claims for Medicare beneficiaries. 
Section 911 of the Medicare Prescription Drug, Improvement, and 
Modernization Act of 2003 (MMA) (Pub. L. 108-173) added section 1874A 
to the Social Security Act (the Act) to require the Secretary of Health 
and Human Services (the Secretary) to replace Part A FIs and Part B 
carriers with Medicare Administrative Contractors (MACs). This 
contracting reform was intended to improve Medicare's administrative 
services to beneficiaries and health care providers through the use of 
new contracting tools, including competition and performance 
incentives.
    Currently, we award MAC contracts through use of competitive 
procedures in accordance with the Federal Acquisition Regulation (FAR). 
As authorized by the MMA, we established MACs as multistate, regional 
contractors responsible for administering both Medicare Part A and 
Medicare Part B claims. The transition from the Part A FIs and Part B 
carriers to MACs began in 2006, and the last FI and carrier contractor 
operations ended by September 2013.
    We rely on a network of 16 MACs to process Medicare claims, 
including 12 MACs that administer both Part A and Part B claims and 4 
MACs that specialize in administering Part B claims for durable medical 
equipment, prosthetics, orthotics, and supplies. MACs serve as the 
primary operational contact between the Medicare Fee-For-Service (FFS) 
program and approximately 1.5 million health care providers and 
suppliers enrolled in the program. MACs process Medicare claims, enroll 
health care providers and suppliers in the Medicare program, educate 
providers and suppliers on Medicare billing requirements, and answer 
provider and supplier inquiries. Collectively, the MACs process nearly 
4.9 million Medicare claims each business day and disburse more than 
$365 billion annually in program payments.
    Section 509(a) of the Medicare Access and CHIP Reauthorization Act 
of 2015 (MACRA) (Pub. L. 114-10) extended the maximum length of a MAC 
contract, inclusive of all option and renewal periods, from 5 years to 
10 years. Section 509(c) of MACRA added a clause to section 
1874A(b)(3)(A) of the Act that requires the Secretary, to the extent 
possible without compromising the process for entering into and 
renewing contracts with MACs, to make available to the public the 
performance of each MAC with respect to such performance requirements 
and measurement standards.

II. Provisions of the Request for Information

    The Government Accountability Office (GAO) has recently noted that, 
now that we have accomplished the major milestone of fully implementing 
and transitioning to the MAC environment, we have the opportunity to 
consider whether some additional contracting mechanisms could be 
utilized to further improve MAC performance. Consistent with the new 
authority provided under MACRA and the recommendation provided by GAO, 
we are evaluating numerous elements of our MAC acquisition strategy, 
including potential adjustments to our MAC contract terms and 
conditions. The scope of our evaluation includes the processes and 
procedures that we use for awarding the MAC contracts and administering 
the MAC contracts after award.
    We currently use a cost-plus-award-fee contract type for the MAC 
contracts, meaning that MACs are financially incentivized and rewarded 
with

[[Page 79345]]

additional fee/profit for exceptional performance in areas critical to 
the success of the Medicare FFS program. For example, and specific to 
provider satisfaction, we currently measure, evaluate, and reward MACs 
for the quality (accuracy, completeness, customer skills, and adherence 
to the Privacy Act of 1974) of their customer service representatives' 
responses to provider telephone calls and the providers' level of 
satisfaction with the MAC's Web site. The amount of award fee earned by 
the MAC is based on our comprehensive evaluation of the MAC's 
performance against specific, written quality measures and evaluation 
criteria.
    Prior to the enactment of MACRA, the law required that MAC 
contracts be recompeted no less frequently than once every 5 years, 
which created the potential for frequent turnover in these critical 
contracts and disruption for Medicare providers and suppliers. With the 
enactment of MACRA, we are now able to renew a MAC contract for up to 
10 years and reduce the potential for frequent turnover if the MAC 
meets or exceeds our performance objectives; conversely, we may still 
utilize competitive procedures sooner than 10 years in the event that a 
MAC does not meet our performance objectives. In concert with or in 
(partial or full) replacement of our award fee process, we are 
considering incorporating an ``award term'' concept into MAC 
contracting, meaning that we may incentivize and reward consistently, 
well-performing MACs with a longer-term contract (but not longer than 
10 years). For example, MACs that consistently exceed our performance 
standards may be rewarded with a longer-term contract (up to 10 years); 
whereas, MACs that do not consistently exceed our performance standards 
may be limited to a shorter-term contract (more or less than 5 years). 
Therefore, we are soliciting public comment on the following questions 
regarding MAC incentives for exceptional performance:
     Do you have any concerns or suggestions related to 
development of a potential ``award term'' strategy and plan?
     Do you have any other suggestions for incentivizing and 
rewarding exceptional MAC performance?
     Are there any specific metrics or evaluation criteria that 
would be valuable in measuring the level and quality of the service 
provided by a MAC?
     Are there any specific metrics or evaluation criteria that 
would be valuable in measuring the level and quality of the MAC's 
relationships (including education and outreach) with providers?
    Section 509(c) of MACRA directs us to make some MAC performance 
metrics available to the public, to the extent that doing so can be 
done in a manner that does not compromise the competitive procurement 
process. Therefore, we are requesting comment on the following 
questions regarding MAC performance transparency:
     With regard to the MAC's quality and level of service and 
performance, what types or kinds of information should be published for 
public release?
     If we were to publish the results of the evaluation of a 
MAC's performance on our Web site, which types of metrics or 
information should be made available for public release?
    We are also soliciting public comment on potential MAC 
jurisdictional changes. Currently, there are 12 A/B MAC jurisdictions; 
in 2010, we announced a plan to consolidate FFS claims operations to 10 
A/B MAC jurisdictions over the course of several years. However, in 
2014, we announced that we were postponing the consolidation of 
Jurisdictions 8 (which encompasses the states of Indiana and Michigan) 
and 15 (which encompasses Kentucky and Ohio) to form ``Jurisdiction I'' 
and the consolidation of Jurisdictions 5 (Iowa, Kansas, Missouri and 
Nebraska) and 6 (Illinois, Minnesota, and Wisconsin) to form 
``Jurisdiction G.'' For more information on our 2010 strategy for 
consolidating A/B MAC jurisdictions, as well as our 2014 decision to 
postpone the final 2 jurisdictional consolidations, see https://www.cms.gov/Medicare/Medicare-Contracting/Medicare-Administrative-Contractors/Downloads/RFI-Announcement-AB-MAC-March-2014.pdf
    Accordingly, we are requesting comment on the following question:
     What would the advantages and disadvantages be if CMS 
completed the last two MAC consolidations?

III. Collection of Information Requirements

    This request for information document does not impose any 
information collection requirements. In accordance with the 
implementing regulations of the Paperwork Reduction Act of 1995 (PRA) 
at 5 CFR 1320.3(h)(4), we believe it is a general solicitation of 
comments from the public. Therefore, it is exempt from the requirements 
of the PRA (44 U.S.C. 3501 et seq.).

IV. Response to Comments

    Because of the large number of public comments we normally receive 
on Federal Register documents, we are not able to acknowledge or 
respond to them individually. We will consider all comments we receive 
by the date and time specified in the DATES section of this preamble, 
and, when we issue a subsequent document, we will respond to the 
comments in the preamble to that document.

    Dated: November 23, 2015.
Andrew M. Slavitt,
Acting Administrator, Centers for Medicare & Medicaid Services.
[FR Doc. 2015-32027 Filed 12-18-15; 8:45 am]
BILLING CODE 4120-01-P