View all text of Part E [§ 1395x - § 1395lll]
§ 1395kk–1. Contracts with medicare administrative contractors
(a) Authority
(1) Authority to enter into contracts
(2) Eligibility of entities
An entity is eligible to enter into a contract with respect to the performance of a particular function described in paragraph (4) only if—
(A) the entity has demonstrated capability to carry out such function;
(B) the entity complies with such conflict of interest standards as are generally applicable to Federal acquisition and procurement;
(C) the entity has sufficient assets to financially support the performance of such function; and
(D) the entity meets such other requirements as the Secretary may impose.
(3) Medicare administrative contractor defined
For purposes of this subchapter and subchapter XI—
(A) In general
(B) Appropriate medicare administrative contractor
(4) Functions described
The functions referred to in paragraphs (1) and (2) are payment functions (including the function of developing local coverage determinations, as defined in section 1395ff(f)(2)(B) of this title), provider services functions, and functions relating to services furnished to individuals entitled to benefits under part A or enrolled under part B, or both, as follows:
(A) Determination of payment amounts
(B) Making payments
(C) Beneficiary education and assistance
(D) Provider consultative services
(E) Communication with providers
(F) Provider education and technical assistance
(G) Improper payment outreach and education program
(H) Additional functions
(5) Relationship to MIP contracts
(A) Nonduplication of duties
(B) Construction
(6) Application of Federal Acquisition Regulation
(b) Contracting requirements
(1) Use of competitive procedures
(A) In general
(B) Renewal of contracts
(C) Transfer of functions
(D) Incentives for quality
(i) In general
(ii) Improper payment rate reduction incentives
(iii) Incentives
The incentives provided for under clause (ii)—
(I) may include a sliding scale of award fee payments and additional incentives to medicare administrative contractors that either reduce the improper payment rates in their jurisdictions to certain thresholds, as determined by the Secretary, or accomplish tasks, as determined by the Secretary, that further improve payment accuracy; and(II) may include substantial reductions in award fee payments under cost-plus-award-fee contracts, for medicare administrative contractors that reach an upper end improper payment rate threshold or other threshold as determined by the Secretary, or fail to accomplish tasks, as determined by the Secretary, that further improve payment accuracy.(2) Compliance with requirements
(3) Performance requirements
(A) Development of specific performance requirements
(i) In general
(ii) Consultation
(iii) Publication of standards
(iv) Contractor performance transparency
(B) Considerations
(C) Inclusion in contracts
All contractor performance requirements shall be set forth in the contract between the Secretary and the appropriate medicare administrative contractor. Such performance requirements—
(i) shall reflect the performance requirements published under subparagraph (A), but may include additional performance requirements;
(ii) shall be used for evaluating contractor performance under the contract; and
(iii) shall be consistent with the written statement of work provided under the contract.
(4) Information requirements
The Secretary shall not enter into a contract with a medicare administrative contractor under this section unless the contractor agrees—
(A) to furnish to the Secretary such timely information and reports as the Secretary may find necessary in performing his functions under this subchapter; and
(B) to maintain such records and afford such access thereto as the Secretary finds necessary to assure the correctness and verification of the information and reports under subparagraph (A) and otherwise to carry out the purposes of this subchapter.
(5) Surety bond
(c) Terms and conditions
(1) In general
(2) Prohibition on mandates for certain data collection
(d) Limitation on liability of medicare administrative contractors and certain officers
(1) Certifying officer
(2) Disbursing officer
(3) Liability of medicare administrative contractor
(A) In general
(B) Relationship to False Claims Act
(4) Indemnification by Secretary
(A) In general
(B) Conditions
(C) Scope of indemnification
(D) Written approval for settlements or compromises
(E) Construction
Nothing in this paragraph shall be construed—
(i) to change any common law immunity that may be available to a medicare administrative contractor or person described in subparagraph (A); or
(ii) to permit the payment of costs not otherwise allowable, reasonable, or allocable under the Federal Acquisition Regulation.
(e) Requirements for information security
(1) Development of information security program
(2) Independent audits
(A) Performance of annual evaluations
Each year a medicare administrative contractor that performs the functions referred to in subparagraphs (A) and (B) of subsection (a)(4) (relating to determining and making payments) shall undergo an evaluation of the information security of the contractor with respect to such functions under this subchapter. The evaluation shall—
(i) be performed by an entity that meets such requirements for independence as the Inspector General of the Department of Health and Human Services may establish; and
(ii) test the effectiveness of information security control techniques of an appropriate subset of the contractor’s information systems (as defined in section 3502(8) of title 44) relating to such functions under this subchapter and an assessment of compliance with the requirements of this subsection and related information security policies, procedures, standards and guidelines, including policies and procedures as may be prescribed by the Director of the Office of Management and Budget and applicable information security standards promulgated under section 11331 of title 40.1
(B) Deadline for initial evaluation
(i) New contractors
(ii) Other contractors
(C) Reports on evaluations
(i) To the Department of Health and Human Services
(ii) To Congress
(iii) Agency reporting
(f) Incentives to improve contractor performance in provider education and outreach
(g) Communications with beneficiaries, providers of services and suppliers
(1) Communication strategy
(2) Response to written inquiries
(3) Response to toll-free lines
(4) Monitoring of contractor responses
(A) In general
Each medicare administrative contractor shall, consistent with standards developed by the Secretary under subparagraph (B)—
(i) maintain a system for identifying who provides the information referred to in paragraphs (2) and (3); and
(ii) monitor the accuracy, consistency, and timeliness of the information so provided.
(B) Development of standards
(i) In general
(ii) Evaluation
(C) Direct monitoring
(5) Authorization of appropriations
(h) Improper payment outreach and education program
(1) In general
(2) Information to be provided through activities
The information to be provided under such payment outreach and education program shall include information the Secretary determines to be appropriate, which may include the following information:
(A) A list of the providers’ or suppliers’ most frequent and expensive payment errors over the last quarter.
(B) Specific instructions regarding how to correct or avoid such errors in the future.
(C) A notice of new topics that have been approved by the Secretary for audits conducted by recovery audit contractors under section 1395ddd(h) of this title.
(D) Specific instructions to prevent future issues related to such new audits.
(E) Other information determined appropriate by the Secretary.
(3) Priority
A medicare administrative contractor shall give priority to activities under such program that will reduce improper payments that are one or more of the following:
(A) Are for items and services that have the highest rate of improper payment.
(B) Are for items and service 2
2 So in original. Probably should be “services”.
that have the greatest total dollar amount of improper payments.(C) Are due to clear misapplication or misinterpretation of Medicare policies.
(D) Are clearly due to common and inadvertent clerical or administrative errors.
(E) Are due to other types of errors that the Secretary determines could be prevented through activities under the program.
(4) Information on improper payments from recovery audit contractors
(A) In general
(B) Information
The information described in subparagraph (A) shall include information such as the following:
(i) Providers of services and suppliers that have the highest rate of improper payments.
(ii) Providers of services and suppliers that have the greatest total dollar amounts of improper payments.
(iii) Items and services furnished in the region that have the highest rates of improper payments.
(iv) Items and services furnished in the region that are responsible for the greatest total dollar amount of improper payments.
(v) Other information the Secretary determines would assist the contractor in carrying out the program.
(5) Communications
(Aug. 14, 1935, ch. 531, title XVIII, § 1874A, as added and amended Pub. L. 108–173, title IX, §§ 911(a)(1), 912(a), 921(b)(1), (c)(1), 934(a), 940A(b), Dec. 8, 2003, 117 Stat. 2378, 2387–2389, 2406, 2417; Pub. L. 111–152, title I, § 1302, Mar. 30, 2010, 124 Stat. 1057; Pub. L. 114–10, title V, §§ 505(a), 509(a), (c), Apr. 16, 2015, 129 Stat. 166, 170; Pub. L. 114–115, § 7(a), Dec. 28, 2015, 129 Stat. 3134.)