What is a Non-Institutional Medicaid Provider Agreement?
Non-Institutional Medicaid Provider Agreements are provider agreements with the Medicaid fiscal agent by which certain services are paid for by the Medicaid program. Non-Institutional Medicaid providers agree to provide Medicaid services in exchange for reimbursement under the Medicaid program. Providers are required to have a non-institutional Medicaid provider agreement in order to be an approved provider and receive reimbursement from the Medicaid program. The Non-Institutional Medicaid Provider Agreement sets forth terms and conditions that are agreed to by an approved provider to promote the integrity , efficiency, and quality of care provided to recipients. It is very important for healthcare providers to fully understand the terms the conditions of Non-Institutional Medicaid Provider Agreements in order to protect against payment recoupments or lawsuits.
Key Elements of a Provider Agreement
It is critical to understand the essential components of a Non-Institutional Medicaid Provider Agreement (the "Agreement") and how those components apply to you as the provider. The following is a list of the key components generally contained in an Agreement, and why each component is important to you as the provider.
- Compensation Rate. This is the amount you will be paid for the services you provide to the Medicaid recipient. There must be a separate rate for each provider type. The rates are confidential so providers cannot compare their rates with rates for other providers. Your rate is not subject to negotiation except to the extent it is adjusted pursuant to a Medicaid rate increase.
- Office Service Requirements. These are requirements related to your office hours, staff, equipment and schedules. It is critical that you understand and adhere to these requirements to avoid potential negative consequences including termination of the Agreement.
- Site Visits and Patient Reviews. The State’s External Quality Review Organization (EQRO) will conduct site visits and patient reviews for the State. It is critical that you maintain the required documentation available for the EQRO during its review to avoid negative consequences.
- Audit Requirements. You will have office audits and patient record audits conducted by the State. The provider will be notified of the audit in advance. It is critical that you comply with any audit requests to avoid negative consequences including termination of the agreement.
- Revenue Notification Requirement. The Agreement outlines the notification requirements for providers if the provider has income in excess of $1 million annually including information related to the source and amount of income. Failure to notify the State is grounds for termination of the agreement.
The Steps to Becoming a Medicaid Provider
In order to become a non-institutional Medicaid provider, a healthcare provider must become enrolled as a Medicaid provider as a prerequisite to billing for services paid for by the Division of Medical Assistance and Health Services ("DMAHS"). This means that in order for the services of a new healthcare provider (who previously has not been enrolled to become a New Jersey Medicaid provider) to be reimbursed, it must enroll. Only then may it obtain a provider number and submit claims to be paid by Medicaid.
Online Provider Enrollment Applications. A new healthcare provider may apply online for enrollment to become a FFS Medicaid provider. The online application is submitted to DMAHS for processing. The online application contains multiple pages categorizing the different groups of providers (e.g., Physicians, Dental Services, Home Health Services, Mental Healthcare Services, Medical Equipment Services, Orthotics and Prosthetics Services, Medical Transportation Services, et cetera). If the applicant wants to qualify as more than one categorical provider, the applicant must apply to each category separately. It is recommended that the applicant saves a copy of the application before submitting. An email acknowledgment will be sent from DMAHS to the applicant if the application is accepted. DMAHS processes the enrollment application and approves or denies it. Once approved, the new provider will receive an enrollment letter via U.S. mail.
Enrollment Application Fees. There is no enrollment fee for a healthcare provider to apply to become a FFS Medicaid provider. However, the FFS Medicaid provider is billed and must pay an annual recertification fee of $20.00 to maintain its good standing. This fee can be found on the provider enrollment website.
Otherwise, if the healthcare provider’s application is denied, it must reapply.
Any information changes to an existing FFS Medicaid provider business, or if the provider is dis-enrolling from the program must be made via written request to DMAHS. If a healthcare provider wants to dis-enroll from the FFS Medicaid program, it must do so in writing. The provider must provide its reason for dis-enrollment, and contact information so that DMAHS is able to resolve any issues raised or questions posed. DMAHS will process the dis-enrollment, and will notify the provider via U.S. mail as to whether the dis-enrollment was accepted.
Certification Process. An FFS Medicaid provider is subject to an enrollment review upon certification and every three years thereafter. Pursuant to the FFS Medicaid Manual, the enrollment review involves an on-site survey of the provider’s practice location to confirm the provider’s eligibility to participate in the FFS Medicaid program. The survey will also review the provider’s qualifications, its physical facility, and polices and procedures, to ensure compliance with program requirements. The provider is given 30 days written notice of the date of the on-site survey. If the provider does not successfully pass the enrollment review, it will be terminated from the program. The provider may not bill for services provided on or after the date the provider was informed of its termination.
If a healthcare provider has successfully been recertified, it is subject to a revalidation review every five-years from the date of its previous review. The revalidation process is similar to the enrollment review process.
Miscellaneous Information. It is important to note that in order for a provider to receive a payment, it must submit a claim specifically addressing the service it performed which falls within the scope of its practice, use, and eligibility under the Medicaid Program. For example, if a physician provides a service that is not included within the scope of eligible FFS Medicaid provider services or requests pre-approval for a service that is not covered under the program, the service will not be reimbursed.
The FFS Medicaid program has specific policies related to service delivery, reimbursement methodology, policy, billing procedures (e.g., claims submission, claims payment, claims adjustment, claims denial, etc.), and appeals, to ensure adherence to the program requirements. All FFS Medicaid providers must comply with these requirements, which are further governed by a plethora of statutes, regulations, policies, procedures, and directives.
Regulatory and Compliance Issues
In applying for and accepting the Medicaid provider agreement, providers promise and affirm that they will abide by numerous laws and regulations. These include such items as the following:
A multitude of other compliance issues arise in the day-to-day operation of a Medicaid office, beginning with the initial entry of information onto the Medicaid claims form, through the transmission of the information to the Medicaid fiscal intermediary and the payment of the claim. Compliance issues are also present when it comes to the retention and care of patient records, securities, building maintenance , and many others. But all of these issues begin with the agreement to comply with the law and regulations when entering into a Medicaid provider agreement.
There are a number of different entities that may seek to enforce compliance with the laws and regulations, including the Medicaid fiscal intermediary, various state Medicaid agencies, the U.S. Department of Health and Human Services Office of Inspector General, and various private citizens. The penalties for non-compliance will vary, perhaps ranging from a warning to suspension or termination of the Medicaid provider agreement, to even prosecution for fraud; others more mundane issues may result in fines or repayment of overpayments. But an ounce of prevention is worth a pound of cure; issues of compliance should be top of mind when accepting a Medicaid provider agreement.
Advantages of Signing a Medicaid Provider Agreement
Before enrollment in a Medicaid program can take place, health care providers must sign a Medicaid Provider Agreement. This Agreement is essentially a contract that outlines the terms and conditions for participation in the Medicaid program as a participating health care provider (and one that has the means to bill the state Medicaid agency). Most importantly, this Medicaid Provider Agreement is not a document that is merely signed and forgotten. It is a legally binding document that must be followed in order for its health care provider to participate with the Medicaid program.
The major benefit of signing a Medicaid Provider Agreement is the fact that it allows health care providers to treat Medicaid beneficiaries and receive payments from the Medicaid program on behalf of their services to those beneficiaries. Once a health care provider signs the Medicaid Provider Agreement, the Medicaid provider becomes responsible for complying with all federal and state laws and regulations regarding Medicaid participants. Further, the health care provider that makes such as agreement is entitled to the benefits of certain provider reimbursements for its services.
Common Roadblocks and Remedies
Challenges abound in the execution and management of Medicaid Waters. It is not uncommon for providers to think they have it all under control only to discover hidden provisions later, or worse, receive a letter from the State or Federal government cancelling their Medicaid provider agreement for what is deemed to be a blatant and/or accidental violation.
The most common issues that I encounter are:
- Failing to include all applicable entities in the Medicaid Provider Agreement;
- Failing to understand how the Medicaid regulations apply to a particular entity;
- Failing to thoroughly amend the Medicaid Provider Agreement following a change of ownership; and
- Failing to properly submit an application for the new business type post-acquisition.
While these issues may seem basic, the complexity of the underlying issues occur based on the specific type of Medicaid Service Agreement and the complicated web of agreements and direct ownership interests between related entities. For example , a physician who owns his or her own Practice/Ancillary Entity will enter into a separate Provider (i.e. physician group) Agreement with the State Medicaid Agency and a separate Clinical Laboratory Agreement with the Clinical Lab Services Medicaid Agency. Each entity must also enter into corresponding Provider Agreements with Managed Care Organizations (MCOs) that align with its designated NPI number. Therefore, in the above example, one physician (NPI number) can have multiple Provider Agreements due to the number of organizations with which he or she does business. And as the description above suggests, if a detailed analysis is not conducted with respect to each Agreement, Providers may find that the State or Federal Government is interpreting the above existing arrangements to be an unwitting Fraud, Waste and Abuse violation.