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Through ZPIC audits, the government is becoming better able to successfully identify fraud, waste and abuse, and becoming more effective in successfully prosecuting those at fault.
In 1996, Congress passed the Health Insurance Portability and Accountability Act (HIPAA). Not only did HIPAA lead to the maze of privacy and security regulations to which physicians must adhere, it established the Medicare Integrity Program, which authorized the Centers for Medicare and Medicaid Services (CMS) to contract with program safeguard contractors (PSCs) to identify fraud and improper billing.
To further the role of the PSCs, the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 authorized CMS to contract with Medicare administrative contractors (MACs) to replace fiscal intermediaries and carriers and to consolidate benefit integrity functions to a select few contractors in 7 geographic areas or zones.
In 2008, CMS also added a more aggressive-and potentially more lethal-weapon against errant billers. At that time, the agency began consolidating the functions of the PSCs and the Medicare prescription drug integrity contractors (charged with combating fraud and abuse in the Part D prescription drug benefit program) into ZPICs.
ZPICs have been hired by CMS to identify potential fraud, waste, and abuse using reactive and proactive identification methods. They are expected to develop cases against providers using data analysis, pre- and post-payment medical review of claims, evaluation of complaints, and fraud detection mechanisms. They also are expected to work with law enforcement agencies, both during investigation and prosecution of healthcare fraud cases, and to refer cases to them for prosecution. Also, they are to train MACs to more effectively address fraud, waste, and abuse.
As of this writing, ZPIC contracts have been awarded for 3 of the 7 ZPIC zones. MACs will continue to interact with PSCs in those jurisdictions where ZPIC contracts have not been awarded.
DOCTORS A ZPIC FOCUS
Unlike RACs, ZPICs are focusing their efforts on physicians, physical therapy providers, skilled nursing facilities, and durable medical equipment suppliers. The audits combine claims data from multiple CMS contractors to create a complete profile of a beneficiary's claim history. This information includes national claims data from the Health Care Customer Information System, the CMS Data Center's Part B Analytics System, and local data compilations. When a ZPIC identifies overpayments, it refers it to a RAC or a MAC, which then attempts to recoup funds from the provider.