PERM Review

Eligibility Review

The purpose of the eligibility review is to verify beneficiary eligibility not the caseworker’s actions. Eligibility reviewers look to the beneficiary’s categorical and financial eligibility to determine if the person is eligible or ineligible. For active case reviews, a case is correct if the beneficiary is determined “eligible” and is in error if the beneficiary is determined “ineligible” for Medicaid or SCHIP. Active cases are considered “undetermined” if eligibility cannot be verified with documentation provided or obtained. Negative cases are reviewed to determine if applicants and beneficiaries are denied or terminated in error. Cases denied or terminated in error should be referred back to the agency responsible for the eligibility determination for a redetermination for benefits.

Claims Review

For the Claims review each state submits quarterly “universe data” to the Statistical Contractor (contracting strategy explained below). Universe data files are essentially very long “lists” of nearly all the Medicaid and SCHIP beneficiary-specific payment records adjudicated by a state during the quarter. States compile PERM universe files from MMIS systems, data warehouses, HIPP payment files, county and state agency systems, vendor payment systems, managed care files, and a variety of other sources. States then divide their PERM universe data into four program areas:

Claim Review Contracting Strategy

CMS announced in October of 2006 that it would adopt a national contracting strategy to complete the reviews and divided the review into three contract areas of responsibility: Statistical, Data Documentation, and Review.

The Statistical Contractor (SC) – The Lewin Group is responsible for:

• Collecting the “universe” of claims data.
• Selection of a random sample from the universe data to be used in the review.
• Collection of records including layouts and data dictionary.

The Data Documentation Contractor (DDC) – Livanta is responsible for:

• Requesting provider medical records.
• Collecting State policies and procedures.

The Review Contractor (RC) – Health Data Insights (HDI) is responsible for:

• Review of all records for medical necessity.
• Review of all claims for processing accuracy.

When the review is completed, CMS will compute state and national error rates and will publish the findings.

Want more details? Please see our Frequently Asked Questions.