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The New Medicare Administrative Contractors (MACs)

As a result of a provision in the Medicare Modernization Act of 2003 (MMA), the Centers for Medicare and Medicaid Services (CMS) has been charged with significantly altering the way they award contracts to carriers and fiscal intermediaries—the companies hired by Medicare to process your Medicare claims. The reform efforts are aimed at making Medicare contract awards more competitive and contracts more efficient. CMS will put the contracts up for bidding at least once every five years.

Under the new system, which is being rolled out through 2011, there will be fifteen new Part A/B MAC jurisdictions. This is a significant departure from the old system, under which there were eighteen Part B Carriers and twenty-five Part A Fiscal Intermediaries.

Reporting Problems with your Medicare Administrative Contractor

The AMA needs your help as we work to correct the significant problems occurring with the Medicare Administrative Contractors (MAC). The AMA continues to learn of numerous problems with the Center for Medicare and Medicaid Services’ (CMS) transition to these MACs. Complaints are widespread and include problems such as mishandling physician claims—both paper and electronic—leading to significant delays in payment. Physician offices are also facing significant and frustrating delays in the timeliness and accuracy of the MAC’s customer service to address these mishandled claims. These issues are drastically affecting physicians’ ability to provide high quality patient care. In some instances, physician offices have even had to seek private loans to cover the lost cash flow directly due to the MACs mishandling of their claims.

The AMA is urging CMS to correct these major problems but we need your help. In an effort to document the far reaching issues with the MACs, we are asking you to provide us with information by filling out a complaint form. This form will be used only by AMA staff and your specific details will not be used unless you give express permission to the AMA.

By providing us with details about your experience with the MAC in you region you will be directly supporting the AMA's efforts to address your individual situation as well as the many issues facing physicians across the country.

Once completed, forms should be e-mailed to: MedicareProblems@ama-assn.org

Impact of Medicare Administrative Contractor transition on Physicians

The AMA is concerned that as a result of a competitive bidding process, the MACs are funded at levels significantly lower than the previous carriers. This is having a significant impact on physicians’ ability to deliver high quality patient care. Below are details of the problems physicians are facing, based on numerous complaints we have received across the country.

Customer Service
Physicians have had significant problems with MAC customer service. Because of these problems, the AMA has been advocating aggressively for additional resources to be put towards physician education and knowledgeable MAC customer service agents.

One of the primary reasons for Medicare contracting reform was poor customer service documented by the U.S. Government Accountability Office (GAO). Thus, measuring MAC customer service going forward is critical. In fact, customer service is one of the key areas in which MACs will be evaluated (others include operational excellence, innovation and technology, and financial management). One way CMS intends to measure customer service is through Medicare Contractor Provider Satisfaction Survey (MCPSS). The survey asks physicians about their satisfaction with 7 key areas: provider outreach and education, provider inquiries, claims processing, appeals, provider enrollment, medical review, and provider audit and reimbursement. Thus, the AMA strongly urges you to complete the MCPSS if you receive one. More information about this survey can be found on the CMS website.

Delays in Claims Processing and Reimbursement
Physicians have reported a number of claims processing problems following the transition to their new MAC. Some physicians who submit paper claims have experienced trouble with the MACs scanning their claims correctly into the system resulting in the MACs’ system being unable to read and process the claims and therefore rejecting them. Other physicians have reported claims denials for use of certain codes and modifiers. The AMA urges physicians who experience these problems and who have been unable to get these problems resolved by their MACs, to contact their state medical society for assistance.

Contractor Medical Directors (CMDs)
Under the most recent Statement of Work (SOW) for the MACs, CMS calls for a minimum of one Contractor Medicare Director (CMD) per MAC jurisdiction. We continue to urge CMS to require the MACs to maintain one CMD per state, unless the state medical society deems a regional, multi-state Medical Director is appropriate.

Contractor Advisory Committees (CACs)
The AMA has been successful in getting CMS to agree to include in the MAC SOW a requirement for MACs to maintain Contractor Advisory Committees (CACs). This requirement was previously omitted under earlier versions of the SOW.

Local Coverage Determinations (LCDs)
We remain concerned about the impact CMS’ decision to move to a policy that calls for selecting the least restrictive Local Coverage Determination (LCD) will have on physicians and we continue to urge CMS to provide opportunities for input and review by the physician community prior to enactment of any changes in LCDs under the MACs.