SECTION III: OTHER INFORMATION (Section 11)

FY 2017 HHS Agency Financial Report

Topics in this Section:  Other Financial Information | Reduce the Footprint | Summary of Financial Statement Audit and Management Assurances | Civil Monetary Penalty Adjustment for Inflation | Grants Oversight & New Efficiency Act Report | Payment Integrity Report (Section 1-10 | 11 | 12-13) | FY 2017 Top Management and Performance Challenges Identified by the Office of Inspector General

11.0 Program-Specific Reporting Information

11.10 Medicare FFS (Parts A and B)

11.11 Medicare FFS Statistical Sampling Process

HHS uses the Comprehensive Error Rate Testing (CERT) program to estimate the Medicare FFS improper payments.  A stratified random sample of Medicare FFS claims is reviewed to determine if HHS properly paid claims under Medicare coverage, coding, and billing rules.  The CERT program considers any payment for a claim that should have been denied or that was made in the wrong amount (including both overpayments and underpayments) to be an improper payment.  The claim can be counted as either a total or a partial improper payment, depending on the error.  The Medicare FFS improper payment estimate includes improper payments due to insufficient or no documentation.  Furthermore, CERT includes improper payments of all dollar amounts (i.e., there is no dollar threshold under which errors will not be cited), and improper payments caused by policy changes as of the effective date of the new policy (i.e., there is no grace period permitted).

HHS sampled approximately 50,000 claims during the FY 2017 report period.  The CERT program ensures a statistically valid random sample of claims across four claim types:

1. Part A claims excluding hospital Inpatient Prospective Payment System (IPPS) (including but not limited to home health, Inpatient Rehabilitation Facility (IRF), Skilled Nursing Facility (SNF), and hospice);
2. Part A hospital IPPS claims;
3. Part B claims (e.g., physician, laboratory; and ambulance services); and
4. Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS).

The improper payment rate estimated from this sample reflects all claims processed by the Medicare FFS program during the report period.  Additional information on the Medicare FFS improper payment methodology can be found on pages 166-167 of HHS's FY 2012 AFR.

Driver Service Areas 

The Medicare FFS gross improper payment estimate for FY 2017 is 9.51 percent or $36.21 billion.  The FY 2017 net improper payment estimate is 8.92 percent or $33.96 billion.  The decrease from the prior year’s reported improper payment estimate of 11.00 percent was driven by a reduction in improper payments for home health and IRF claims.  Although the improper payment rate for these services and the gross Medicare FFS improper payment rate decreased, improper payments for home health, SNF, and IRF claims were the major contributing factors to the FY 2017 Medicare FFS improper payment rate, comprising 33.25 percent of the overall estimated improper payment rate.  While the factors contributing to improper payments are complex and vary from year to year, the primary causes of improper payments continue to be insufficient documentation and medical necessity errors.

• Insufficient documentation for home health claims continues to be prevalent, despite the improper payment rate decrease from 42.01 percent in FY 2016 to 32.28 percent in FY 2017.  The primary reason for these errors was that the documentation to support the certification of home health eligibility requirements was missing or insufficient.  Medicare coverage of home health services requires physician certification of the beneficiary’s eligibility for the home health benefit (42 CFR 424.22).
• Insufficient documentation was the major error reason for SNF claims.  The improper payment rate for SNF claims increased from 7.76 percent in FY 2016 to 9.33 percent in FY 2017.  The primary reason for these errors was that the certification/recertification statement was missing or insufficient (e.g., one required element was missing).  Medicare coverage of SNF services requires certification and recertification for these services (42 CFR 424.20).
• Medical necessity (i.e., the services billed were not medically necessary) continues to be the major error reason for IRF claims, despite the improper payment rate decrease from 62.39 percent in FY 2016 to 39.74 percent in FY 2017.  The primary reason for these errors was that the IRF coverage criteria for medical necessity were not met.  Medicare coverage of IRF services requires that there must be a reasonable expectation that the patient meets all of the coverage criteria at the time of admission to the IRF (42 CFR 412.622(a)(3)).

To help generate useful information on the root causes of improper payments for HHS, most CERT error categories are more detailed than the OMB root cause categories.  The CERT error categories are listed and described below, while Figure 1 shows the FY 2017 Medicare FFS drivers for home health, SNF, and IRF claims by CERT error category.

CERT Error Category	Description
Insufficient Documentation	These errors occur when the medical records submitted are inadequate to support payment for the services billed.
Medical Necessity	These errors occur when the submitted medical records contain adequate documentation to make an informed decision that the services billed were not medically necessary based upon Medicare coverage and payment policies.
Incorrect Coding	These errors occur when the medical records submitted support a different diagnosis than that billed, the service was performed by someone other than the billing provider or supplier, the billed service was unbundled, or the beneficiary was discharged to a site other than the one coded on the claim.
No Documentation	These errors occur when the provider or supplier fails to respond to repeated requests for the medical records or when the provider or supplier responds that they do not have the requested documentation.
Other	These errors include improper payments that do not fit into any of the previous categories (e.g., duplicate payment error, non-covered or unallowable service, and ineligible Medicare beneficiary, among others).

 

Figure 1:  FY 2017 Medicare FFS Percentage of Overall Improper Payments for Driver Services by CERT Error Category

Monetary Loss Findings 

Improper payments do not necessarily represent expenses that should not have occurred.  Instances where there is insufficient or no documentation to support the payment as proper are cited as improper payments.  Of the documentation errors, at present, HHS is unable to track claims that would have resulted in proper payments, where the program would otherwise have made the payment in the same amount, but documentation did not comply with coverage, coding, and billing rules.  The majority of Medicare FFS improper payments are due to documentation errors where HHS could not determine whether the billed services were actually provided, were provided at the level billed, and/or were medically necessary.

A smaller proportion of improper payments are claims where HHS has determined that the Medicare FFS payment should not have been made, or should have been made in a different amount.  For this reason, medical necessity, incorrect coding, and other errors are considered monetary losses to the program.  FY 2017 represents the first year that HHS is reporting the percent of Medicare FFS projected improper payments resulting in known monetary loss.

Figure 2 provides information on Medicare FFS improper payments that are in fact improper and a “monetary loss” to the program.  In the figure, “unknown” represents payments where there was insufficient or no documentation to support the payment as proper or a known monetary loss.  In other words, when payments lack the appropriate supporting documentation, their validity cannot be determined.  These are payments where more documentation is needed to determine if the claims were payable or if they should be considered monetary losses to the program.

Figure 2:  FY 2017 Medicare FFS Percentage and Estimated Improper Payments (in Millions) by Monetary Loss and Type of CERT Error1 

1 Values in this figure may not add up precisely to other tables in this document due to rounding.

11.12 Medicare FFS CAP

HHS uses data from the CERT program and other sources of information to address improper payments in Medicare FFS through various corrective actions.  This section includes information on key corrective actions to address driver service area errors and OMB root cause categories.

Corrective Actions to Address Driver Service Areas

HHS has developed a number of preventive and detective measures for specific service areas with high improper payment rates such as home health, SNF, and IRF claims.  HHS believes implementing targeted corrective actions will continue to prevent and reduce improper payments in these areas and reduce the overall improper payment rate.

Service Area: Home Health

HHS continues to implement corrective actions to address program payment vulnerabilities related to home health services, including errors resulting from insufficient or missing documentation to support the beneficiary’s eligibility for home health services and/or for skilled services.  Key home health corrective actions include:

• Probe and Educate for HHAs:  During FY 2016, HHS’s Medicare Administrative Contractors (MACs) continued pre-payment reviews of home health claims for episodes beginning on or after August 1, 2015.  These reviews are designed to improve home health agencies’ understanding of beneficiary home health eligibility certification requirements.  Specifically, the MACs use a Probe and Educate strategy to review a small sample of home health claims for every HHA and provide education and/or training as needed.  Round 1 results showed a high denial rate and many providers required a second round of Probe and Educate reviews, which were conducted throughout FY 2017.  The errors identified in Round 1 were primarily insufficient documentation errors and HHS believes these errors can be corrected with additional provider education in Round 2.  Providers who need additional education after Round 2 will be included in the Targeted Probe and Educate program.  Targeted Probe and Educate is similar to this strategy but includes only providers who may need the additional education instead of all providers.   
• Pre-Claim Review Demonstration:  A Pre-Claim Review Demonstration for Home Health Services was operational in Illinois from August 2016 until March 2017, when it was paused by the Department.  Under the demonstration, HHS reviewed pre-claim review requests and provisionally affirmed the requests as likely meeting Medicare rules and requirements prior to claim submission.  Taking into account stakeholder feedback on this demonstration, HHS is considering a number of structural improvements.
• Home Health Recovery Audit Contractors (RAC):  On October 31, 2016, HHS awarded a new Medicare FFS RAC contract to identify and correct improper payments for home health claims.  The RAC will review all applicable claims types and work with HHS and the MACs to recoup overpayments and correct underpayments.  HHS believes the use of RACs helps reduce improper payments and helps educate providers on Medicare policies.  HHS also believes there is a sentinel effect in the provider community with more providers billing accurately because of the possibility of a RAC audit in the future. 
• Home Health Plan of Care/Certification Template:  In FY 2017, HHS released draft electronic and paper home health plan of care/certification templates.  These voluntary templates will support HHAs and assist with improving physician documentation.  In FY 2018, HHS will: (1) host special open-door forums to obtain industry feedback on improving the templates and, (2) complete the Paperwork Reduction Act’s approval process required to finalize these forms as OMB-approved collection instruments.

Service Area: Skilled Nursing Facilities 

HHS has implemented corrective actions for payment errors related to SNF services resulting from missing or insufficient medical record documentation.  Key SNF corrective actions include:

• Supplemental Medical Review Contractor (SMRC) SNF Review Projects:  During FY 2017, HHS tasked the SMRC with performing medical reviews on a post-payment basis for SNF services nationwide.  After the SMRC completes its medical review, the results are shared with the MACs for claim adjustment.  The providers receive detailed review result letters from the SMRC and demand letters for overpayment recovery from the MAC.  These letters include educational information to providers about what was incorrect in the original billing of the claim.  
• RACs:  On October 31, 2016, HHS awarded new Medicare FFS RAC contracts to identify and correct improper payments, which includes potential review of SNF claims.  The RAC will review all applicable claims types and work with HHS and the MACs to recoup overpayments and correct underpayments.  HHS believes the use of RACs helps reduce improper payments and helps educate providers on Medicare policies.  HHS also believes there is a sentinel effect in the provider community with more providers billing accurately because of the possibility of a RAC audit in the future.   
• Medicare Learning Network (MLN) Article:  An MLN article provided targeted education to physicians, non-physician practitioners, and providers who bill for SNF services.

Service Area: Inpatient Rehabilitation Facilities 

HHS also continues focusing on addressing IRF payment errors, including errors resulting from medical necessity, as well as addressing therapy services provided in other settings.  Key IRF corrective actions include:

• Inpatient Rehabilitation Facility Prospective Payment System:  HHS issued an IRF Prospective Payment System final rule, CMS-1608-F (79 FR 45872, August 6, 2014), which required IRFs to record and report to HHS how much and what type of therapy (e.g., Individual, Concurrent, Group, and Co-Treatment) patients receive in each therapy discipline in the IRF setting.  Data are still being collected as of September 2017.  HHS will utilize these data for potentially informing future IRF rulemaking (for example, to clarify policies which could reduce improper payments).
• SMRC IRF Review Projects:  In FY 2017, the SMRC continued performing targeted medical reviews on a post-payment basis for IRF services and other therapy services provided in various settings, potentially resulting in overpayment recoveries.  The providers receive detailed review results letters from the SMRC and demand letters for overpayment recovery from the MAC.  These letters include educational information to providers about what was incorrect in the original billing of the claim.
• IRF Industry Meetings:  HHS held meetings with IRF industry representatives to provide education and clarification on IRF policy requirements.

Other Service Areas

HHS leverages prior corrective action successes in other service areas such as Durable Medical Equipment, Prosthetics, Orthotics, and Supplies (DMEPOS), and other non-emergent services by working with providers to improve understanding of HHS policies and exploring new opportunities for corrective actions as described below.

• DME RAC:  On October 31, 2016, HHS awarded the new Medicare FFS RAC contract to identify and correct improper payments for DMEPOS claims that began in FY 2017.  The RAC will review all applicable claims types and work with HHS and the MACs to recoup overpayments and correct underpayments.  HHS believes the use of RACs helps reduce improper payments and helps educate providers on Medicare policies.  HHS also believes there is a sentinel effect in the provider community with more providers billing accurately because of the possibility of a RAC audit in the future. 
• DMEPOS Prior Authorization Rule:  Building on the Prior Authorization of Power Mobility Devices (PMDs) Demonstration, HHS issued a DMEPOS prior authorization final rule in FY 2016 (CMS–6050–F, 80 FR 81674, December 30, 2015) that establishes a prior authorization program for certain DMEPOS items that are frequently subject to unnecessary utilization.  The rule defines unnecessary utilization as “the furnishing of items that do not comply with one or more of Medicare’s coverage, coding, and payment rules.”  The rule also establishes a list of DMEPOS items that could be subject to prior authorization before items or services are provided and payment is made.
  • In FY 2017, HHS began implementing prior authorization for two types of group 3 power wheelchairs in a staggered approach.  On March 20, 2017, prior authorization began in Illinois, Missouri, New York, and West Virginia.  On July 17, 2017, HHS expanded prior authorization for these two types of power wheelchairs nationwide.
• PMD Prior Authorization:  In FY 2017, HHS continued the Prior Authorization of PMDs Demonstration.  On September 1, 2012, HHS instituted a prior authorization demonstration program in seven states (California, Illinois, Michigan, New York, North Carolina, Florida, and Texas) for PMDs.  Feedback from the industry and beneficiaries has been largely positive.  HHS expanded the demonstration to an additional 12 states (Arizona, Georgia, Indiana, Kentucky, Louisiana, Maryland, Missouri, New Jersey, Ohio, Pennsylvania, Tennessee, and Washington) effective October 1, 2014, bringing the total number of states participating in the demonstration to 19.  Based on claims processed as of March 30, 2017, monthly expenditures for the PMD codes included in the demonstration decreased from $12 million in September 2012 to $2.2 million in September 2016 in the original seven demonstration states, $10 million in September 2012 to $1.7 million in September 2016 in the 12 additional expansion states, and $10 million in September 2012 to $2.2 million in September 2016 in the non-demonstration states.
• Ambulance Transport Prior Authorization:  In FY 2017, HHS continued implementing a prior authorization model for repetitive scheduled non-emergent ambulance transport occurring on or after December 15, 2014 in New Jersey, Pennsylvania, and South Carolina.  On January 1, 2016, in accordance with Section 515 of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), HHS expanded the prior authorization model for repetitive scheduled, non-emergent ambulance transports to five additional states (North Carolina, Virginia, West Virginia, Maryland, and Delaware) and the District of Columbia.  Based on data from the program’s first 2 years, spending decreased in the initial states from an average of $18.9 million to an average of $6.0 million per month.  Based on data from the first year of the expansion, spending decreased from an average of $5.7 million to an average of $3.1 million per month.
• Hyperbaric Oxygen Therapy Prior Authorization:  In FY 2017, HHS continued a prior authorization model for non-emergent hyperbaric oxygen therapy in Michigan, Illinois, and New Jersey.  Launched in 2015, the prior authorization model tests whether prior authorization reduces expenditures while maintaining or improving quality of care.  This project will also help ensure services are provided in compliance with applicable Medicare coverage, coding, and payment rules before rendering services and paying claims.  Prior to implementing the model, spending on outpatient hyperbaric oxygen therapy in the model states averaged $1.69 million per month.  Based on data from the program’s first 2 years, spending decreased to an average of $943,231 per month.

In addition to these initiatives, HHS has implemented further efforts to reduce improper payments in Medicare FFS that span multiple service areas and address the OMB root causes of improper payments as outlined below.

Corrective Actions to Address OMB Root Causes: 

Root Cause: Administrative or Process Errors Made by Other Party

Administrative or process errors made by other party (16.66 percent) mainly consists of coding errors.

• Automated Edits:  Due to the high volume of Medicare claims processed by HHS each day and the significant cost associated with conducting medical review of an individual claim, HHS relies on automated edits to identify inappropriate claims.  HHS designed its systems to detect anomalies on the face of the claims, and through these efforts, HHS prevents payment for many erroneous claims.  HHS uses the National Correct Coding Initiative (NCCI) to stop claims that never should be paid.  For example, this program prevents payments for services such as a hysterectomy for a man or a prostate exam for a woman.  The NCCI edits saved the Medicare program $815.17 million in FY 2016.  HHS will report FY 2017 savings from the NCCI edits in the FY 2018 AFR.
• Provider and Supplier Screening:  HHS is statutorily required to revalidate all existing Medicare providers and suppliers.  All Medicare providers and suppliers enrolled prior to the new screening requirements becoming effective were sent revalidation notices by March 23, 2015.  HHS is revalidating all existing Medicare providers and suppliers on an ongoing basis to ensure that only qualified and legitimate providers and suppliers deliver health care items and services to Medicare beneficiaries.  As of October 2017, these revalidation efforts resulted in approximately 379,000 deactivations, as well as the revocation of approximately 24,500 providers’ and suppliers’ billing privileges, that did not meet Medicare requirements.
• Healthcare Fraud Prevention Partnership (HFPP):  HHS continues to build the HFPP, a public-private partnership to improve detection and prevention of health care fraud, waste, and abuse by exchanging data, information, and anti-fraud practices.  During FY 2017, HFPP membership grew from 69 to 85 partner organizations, including federal and state partners, private payers, associations, and law enforcement organizations. 
• Medical Review Strategies:  HHS and its contractors develop medical review strategies using the improper payment data to ensure the areas of highest risk and exposure are targeted.  HHS requires its Medicare review contractors to focus on identifying and preventing improper payments due to documentation errors in certain error-prone claim types, such as home health, IRF, and SNF claims.
• Overpayment Recoveries Related to Regulatory Provisions:  In CMS-6037-F, “Medicare Program: Reporting and Returning of Overpayments” (81 FR 7654, February 12, 2016), HHS codified rules that require providers and suppliers to identify, report, and return any Medicare Part A or Part B overpayments.  This rule implements Section 1128J(d) of the Social Security Act to create significant incentives for providers and suppliers to identify, report, and return any amounts they have been overpaid.  This rule incentivizes providers and suppliers to maintain documentation and submit accurate claims, thus reducing potential improper payments.

Root Cause:  Insufficient Documentation to Determine and Medical Necessity

The primary cause of improper payments in Medicare FFS is insufficient documentation errors (65.82 percent).  For these claims, the submitted medical records are inadequate to conclude that the billed services were actually provided, were provided at the level billed, and/or were medically necessary.  Claims are also placed into this category when a specific documentation element that is required as a condition of payment is missing, such as a physician signature on an order or a form that is required to be completed in its entirety.  If the documentation had been submitted or providers had complete and sufficient documentation, then the claim may have been payable.  Another cause of improper payments is medical necessity errors (17.52 percent).  For these claims, the submitted medical records contain adequate documentation to make an informed decision that the services billed were not medically necessary based upon Medicare coverage and payment policies.

• SMRC Strategy: HHS contracted with the SMRC to perform medical reviews focused on vulnerabilities identified by HHS data analysis, the CERT program, professional organizations, and federal oversight entities.  The contractor evaluates medical records and related documents to determine whether claims were billed in compliance with Medicare coverage, coding, payment, and billing rules.  In FY 2017, the SMRC performed post-payment reviews on IRFs, SNF therapy services, chiropractic services, Medicare Part B drugs, and ophthalmology services.  HHS uses the reviewers’ results to improve billing accuracy.  The results are shared with providers through detailed review results letters and possible overpayment determinations.  The providers receive detailed review results letters from the SMRC and demand letters for overpayment recovery from the MAC.  These letters include educational information to providers about what was incorrect in the original billing of the claim.
• Medical Review Strategies: HHS is moving from a broad Probe and Educate program to a more targeted approach where MACs focus on specific providers and suppliers within a particular service type rather than all providers and suppliers billing the service.  This eliminates burden to providers and suppliers who, based on data analysis, are already submitting claims that are compliant with Medicare policy.  To further this strategy, in 2016, HHS began a pilot Targeted Probe and Educate process in one MAC jurisdiction to focus on aberrant providers and suppliers, and completed a small probe review with education offered to the provider or supplier as necessary.  In July 2017, HHS expanded the pilot to three additional MAC jurisdictions and will expand to all MAC jurisdictions at the beginning of FY 2018.
• Medical Review Accuracy Award Fee Metric: Beginning in FY 2014, HHS included the Medical Review Accuracy Award Fee Metric in the Award Fee Plan for MACs that process Part A, Part B, and DME claims.  The Medical Review Accuracy Award Fee Metric measures the accuracy of the MAC’s complex medical review decisions.  This project assists with consistent medical review decisions across MACs, leading to uniform education to providers on all improper payments, including medical necessity and the impact of insufficient documentation errors.  HHS is also considering implementing an accuracy review initiative for the MAC redetermination appeal units to ensure consistent medical review decisions are made at that level.
• Provider Billing Review Evaluation: HHS issues Comparative Billing Reports (CBRs) to help Part B providers analyze their coding and billing practices for specific procedures or services.  CBRs are proactive reports that enable providers to compare their billing patterns to their peers in the state and across the nation.  By giving providers comparative information, HHS is empowering providers to review their own billing practices to determine if they are potentially aberrant.  CBRs should be viewed as a non-intrusive corrective action and if a provider analyzes and makes modifications based on a CBR future corrective action may not be warranted.   
• Provider Billing Self-Review: HHS launched a Provider Billing Self-Review Evaluation in one MAC jurisdiction in FY 2016 to help Part B providers analyze their coding and billing practices.  The initiative expands the self-service exchange of information beyond the transaction-based activities of claims, eligibility, medical review, prior authorization, and payment to now include utilization data and information designed to support Part B providers’ awareness and compliance.  In addition, the system prompts users to utilize self-service educational materials that will be tracked via web analytics.  The pilot attempts to create a partnership between the provider and the MAC to ensure claims are paid appropriately and seeks to determine if providers are willing to self-review and identify improper payments.  Self-review and identification of incorrect claims reduces burden placed on a provider by traditional medical review processes.     

11.13 Medicare FFS Information Systems and Other Infrastructure

HHS’s systems have the ability to identify developing and continuing aberrant billing patterns based upon a comparison of local payment rates with national rates.  The systems at both the Medicare contractor-level and the HHS-level are linked by a high-speed, secure network that allows for the rapid transmission of large data sets between systems.  In addition, HHS continuously reviews opportunities for centralizing the development and implementation of automated edits based on national coverage determinations, medically unlikely units billed, and other relevant parameters to prevent improper payments on a prepayment basis.

11.14 Medicare FFS Statutory or Regulatory Barriers that Could Limit Corrective Actions

HHS has not identified statutory or regulatory barriers that could limit corrective actions.

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11.20 Medicare Advantage (Part C)

11.21 Medicare Advantage Statistical Sampling Process

The Part C methodology estimates improper payments resulting from errors in beneficiary risk scores.  The primary component of most beneficiary risk scores is based on clinical diagnoses submitted by the plan.  If the diagnoses submitted to HHS are not supported by medical records, the risk scores will be inaccurate and result in payment errors.  The Part C estimate is based on medical record reviews conducted under HHS’s annual National Risk Adjustment Data Validation (RADV) process, where HHS identifies unsupported diagnoses and calculates corrected risk scores.

The FY 2017 methodology consisted of the following steps:

• Selection of a stratified random sample of beneficiaries for whom a risk adjusted payment was made in calendar year 2015, where the strata are high, medium, and low risk scores;
• Medical record review of the diagnoses submitted by plans for the sampled beneficiaries;
• Calculation of beneficiary-level payment error for the sample; and
• Extrapolation of the sample payment error to the population subject to risk adjustment, resulting in a Part C gross payment error amount.

The Medicare Part C gross improper payment estimate for FY 2017 is 8.31 percent or $14.35 billion.  The FY 2017 net improper payment estimate is 2.47 percent or $4.27 billion.  The decrease from the prior year’s estimate of 9.99 percent was driven primarily by submission of more accurate diagnoses by Medicare Advantage (MA) organizations for payment.

11.22 Medicare Advantage CAP

The root causes of FY 2017 Medicare Part C improper payments consist of errors due to missing or insufficient documentation (65 percent) and administrative or process errors made by other party (the MA organizations) (35 percent), as displayed in Figure 3 below.

Figure 3: Root Causes of FY 2017 Medicare Part C Improper Payments

Corrective Actions to Address Root Causes: 

Root Causes: Insufficient Documentation to Determine and Administrative or Process Errors Made by Other Party

HHS has implemented four key corrective actions to address the Part C improper payment estimate: 

• Contract-Level Audits:  Contract-level RADV audits are HHS’s primary corrective action to recoup overpayments.  RADV verifies, through medical record review, the accuracy of enrollee diagnoses submitted by MA organizations for risk adjusted payment.  HHS expects that payment recovery will have a sentinel effect on the quality of risk adjustment data submitted by plans for payment, as contract-level RADV audits increase the incentive for MA organizations to submit valid and accurate diagnosis information, and encourage MA organizations to self-identify, report, and return overpayments they have received.  Payment recovery for the pilot audits has been completed, totaling $13.7 million recovered in FYs 2012 through 2014.  After completing the pilots, contract-level RADV audits of payment years 2011 through 2013 are in various stages of the audit process.  For example, payment year 2013 audits continued in FY 2017, and HHS will initiate payment year 2014 audits in FY 2018.  Furthermore, HHS expects to conduct recoveries for the 2011 and 2012 contract-level RADV audits (which began in FY 2014 and FY 2015, respectively) in FY 2018, which will be the first reviews to recoup funds based on extrapolated estimates.   
• Overpayment Recoveries Related to Regulatory Provisions:  As required by the Social Security Act, HHS regulations specify MA organizations report and return overpayments that they identify.  In FY 2017, MA organizations reported and returned approximately $78.71 million in self-reported overpayments.  HHS believes that this requirement will reduce improper payments by encouraging MA organizations to submit accurate payment information.
• Part C RAC:  Section 1893(h) of the Social Security Act required the implementation of a Medicare Part C RAC program.  HHS previously published a solicitation for comments and, in 2014, issued a request for proposal; however, no proposals were received.  In 2015, HHS issued a request for information and reviewed comments received.  Currently, HHS is exploring how to fit the Medicare Part C RAC program into the larger Medicare Part C program integrity efforts, and examining refinements that can be made to the operations of RACs such that their activities do not excessively burden plans.
• Training:  Historically, HHS has conducted fraud, waste, and abuse in-person and webinar training sessions for MA plans.  Only one training session for MA plans was conducted in FY 2017 due to procurement activities that were underway and the termination of contractor support in mid-FY 2017.  In late FY 2017, HHS procured a new contractor to support this initiative and will resume training in FY 2018.

11.23 Medicare Advantage Information Systems and Other Infrastructure

HHS uses the following internal Medicare systems to make and validate Medicare Part C payments:  the Medicare Beneficiary Database (MBD); the Risk Adjustment Processing System (RAPS); the Health Plan Management System (HPMS); and the Medicare Advantage Prescription Drug (MARx) payment system.

11.24 Medicare Advantage Statutory or Regulatory Barriers that Could Limit Corrective Actions

HHS has not identified statutory or regulatory barriers that could limit corrective actions.

11.30 Medicare Prescription Drug Benefit (Part D)

11.31 Medicare Prescription Drug Benefit Statistical Sampling Process

The Part D improper payment estimate measures the payment error related to prescription drug event (PDE) data, where the majority of error for the program exists.  HHS measures the inconsistencies between the information reported on PDEs and the supporting documentation submitted by Part D sponsors: prescription record hardcopies (or medication order, as appropriate), and detailed claims information.  Based on these reviews, each PDE in the audit sample is assigned a gross drug cost error, which is simulated onto a representative sample of beneficiaries to determine the Part D improper payment estimate.

The Medicare Part D gross improper payment estimate for FY 2017 is 1.67 percent or $1.30 billion.  The FY 2017 net improper payment estimate is negative 0.51 percent or negative $394.06 million.  The decrease from the prior year’s estimate of 3.41 percent was driven primarily by submission of more accurate data by Part D sponsors for payment.

11.32 Medicare Prescription Drug Benefit CAP

The root causes of the FY 2017 Part D improper payments are missing or insufficient documentation (35 percent) and administrative or process error made by other party (65 percent), as displayed in Figure 4 below.

Figure 4: Root Causes of FY 2017 Medicare Part D Improper Payments

Corrective Actions to Address Root Causes:

Root Causes: Insufficient Documentation to Determine and Administrative or Process Errors Made by Other Party

HHS conducted the following corrective actions to address payment errors in Part D:

• Training:HHS continued its national training sessions for Part D sponsors on payment and data submission.  For example, HHS continued to offer training sessions with detailed instructions for Part D sponsors submitting documentation to support their PDEs as part of the improper payment estimation process.  Historically, HHS has also conducted fraud, waste, and abuse in-person and webinar training sessions for Part D sponsors.  Only one fraud, waste, and abuse training session for Part D sponsors was conducted in FY 2017 due to procurement activities that were underway and the termination of contractor support in mid-FY 2017.  In late FY 2017, HHS procured a new contractor to support this initiative, and will resume trainings in FY 2018.
• Outreach:  HHS continuedformal outreach to plan sponsors for invalid/incomplete documentation.  HHS distributed Plan Sponsor Summary Reports to all plans participating in the national payment error estimate.  This report provided feedback on their submission and validation results against an aggregate of all participating plan sponsors.
• Overpayment Recoveries Related to Regulatory Provisions: As required by the Social Security Act, HHS requires that Part D sponsors report and return overpayments that they identify (See Section 11.22 for more information on the rule).  HHS believes the overpayment statute and regulation contribute to increased attention paid by Part D sponsors to data accuracy.  In FY 2017, Part D sponsors reported and returned approximately $2.83 million in self-reported overpayments.

11.33 Medicare Prescription Drug Benefit Information Systems and Other Infrastructure

HHS uses the following internal Medicare systems to make and validate the Medicare Part D payments: the MBD; the RAPS; HPMS; the MARx payment system; and the Integrated Data Repository.

11.34 Medicare Prescription Drug Benefit Statutory or Regulatory Barriers that Could Limit Corrective Actions

 HHS has not identified statutory or regulatory barriers that could limit corrective actions.

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11.40 Medicaid

11.41 Medicaid Statistical Sampling Process

HHS estimates Medicaid improper payments on a federal FY basis and measures three components: FFS, managed care, and eligibility.  HHS, through its use of federal contractors, measures the FFS and managed care components.  The eligibility component measurement is paused as described in the eligibility component section below.

HHS’s Payment Error Rate Measurement (PERM) program uses a 17-state three-year rotation for measuring Medicaid improper payments.  The national Medicaid improper payment rate includes findings from the most recent three cycle measurements so that all 50 states and the District of Columbia are captured in one rate.  Each time a group of 17 states is measured under the PERM program HHS removes the previous findings for that group of states from the calculation and includes the newest findings.  The national FY 2017 Medicaid improper payment rate is based on measurements conducted in FYs 2015, 2016, and 2017 (see Figure 5 below).

Figure 5: FY 2017 Medicaid Cycle Measurements

To see how HHS grouped states into three cycles, refer to pages 177 – 179 of HHS's FY 2012 AFR.

FFS and Managed Care Components

States submit quarterly adjudicated claims data from which a randomly selected sample of FFS claims and managed care payments are drawn each quarter.  Each selected FFS claim is subjected to a medical and data processing review.  Managed care payments are only subjected to a data processing review.  The FFS sample size was between 303 and 1,063 claims per state and the managed care sample size was between 230 and 287 payments per state.  The sample sizes were based on each state’s historical FFS and managed care improper payment rate data.  When a state’s FFS component or managed care component accounted for less than 2 percent of the state’s total Medicaid expenditures, HHS combined the state’s FFS and managed care claims into one component for sampling and measurement purposes.

Eligibility Component

In light of changes to the way states adjudicate beneficiary eligibility for Medicaid under current law, in August 2013 and October 2015, HHS released guidance announcing temporary changes to PERM eligibility reviews.  For FYs 2015 through 2018, HHS will not conduct the eligibility measurement component of PERM.  In place of these PERM eligibility reviews, all states are required to conduct eligibility review pilots that provide more targeted, detailed information on the accuracy of eligibility determinations to: provide state-by-state programmatic assessments of the performance of new processes and systems in adjudicating eligibility; identify strengths and weaknesses in operations and systems leading to errors; and test the effectiveness of corrections and improvements in reducing or eliminating those errors.  During this time, for the purpose of computing the overall national improper payment rate, the Medicaid eligibility component improper payment rate is held constant at the FY 2014 national rate of 3.11 percent.

HHS used the eligibility review pilots to test updated PERM eligibility processes, and prepare states for the resumption of the PERM eligibility component measurement.  Based on the pilots, HHS updated the eligibility component measurement methodology and published a final rule (82 FR 31158, July 5, 2017) to update the methodology for the PERM eligibility component.  HHS will resume the eligibility component measurement under this final rule and report an updated national eligibility improper payment estimate in FY 2019.

Calculations and Findings

The national Medicaid program improper payment estimate combines each state’s Medicaid FFS, managed care, and eligibility improper payment estimate.  In addition, individual state component improper payment estimates are combined to calculate the national component improper payment estimates.  National component improper payment rates and the Medicaid program improper payment rate are weighted by state size, such that a state with a $10 billion program is appropriately weighted more in the national rate than a state with a $1 billion program.  A correction factor ensures that Medicaid eligibility improper payments are not “double counted.”  Additionally, HHS incorporates state-level improper payment rate recalculations for the states measured in prior FYs into the national Medicaid improper payment rate.  For example, subsequent to FY 2016 reporting, HHS recalculated 13 state-level FFS improper payment rates to reflect appeal results and documentation that HHS received after the reporting deadline, but within the allowable timeframes for claims paid between October 1, 2014, and September 30, 2015.  HHS incorporated these recalculations into FY 2017 improper payment rate reporting.

The national Medicaid gross improper payment estimate for FY 2017 is 10.10 percent or $36.73 billion.  The FY 2017 net improper payment estimate is 9.94 percent or $36.16 billion.

The FY 2017 national Medicaid improper payment rate for each component is:

• Medicaid FFS: 12.87 percent

• Medicaid managed care: 0.30 percent

Since FY 2014, the Medicaid improper payment estimate has been driven by errors due to state non-compliance with provider screening, enrollment, and National Provider Identifier (NPI) requirements.  First, all referring/ordering providers are required to be enrolled in Medicaid or CHIP and claims must contain the referring/ordering provider NPI.  Second, states are required to screen providers under a risk-based screening process prior to enrollment.  Finally, the attending provider NPI is required to be submitted on all electronically filed institutional claims.  HHS began reviewing against these requirements for FY 2014 improper payment reporting.  Therefore, in FY 2014, HHS saw the first ever increase in the Medicaid improper payment rate when the first cycle of states was reviewed against the new requirements.  The Medicaid rate increased in FY 2015 when HHS reviewed the second cycle of states was reviewed against the new requirements.  FY 2016 represented the first “baseline” improper payment rate reflecting the new requirements because all 50 states and the District of Columbia were measured under the same requirements.  FY 2017 represents the first cycle of states that has been measured a second time.

Compliance with provider screening, enrollment, and NPI requirements for the 17 states measured in FY 2017 improved, and improper payments related to non-compliance decreased.  The Medicaid FFS improper payment rate for non-compliance with these requirements decreased for these states from 5.74 percent in FY 2014 to 4.03 percent in FY 2017.  Although the 17 states reviewed this year had better compliance results compared to their previously measured cycle, non-compliance with the provider screening, enrollment, and NPI requirements is still a major contributor to the improper payment rate.  Additionally, improper payments due to insufficient or no medical documentation increased in FY 2017.

Monetary Loss Findings 

Improper payments do not necessarily represent expenses that should not have occurred.  Instances where there is insufficient or no documentation to support the payment as proper are cited as improper payments.  A majority of Medicaid improper payments were due to instances where information required for payment was missing from the claim and/or states did not follow the appropriate process for enrolling providers.  However, these improper payments do not necessarily represent payments to illegitimate providers and, if the missing information had been on the claim and/or had the state complied with the enrollment requirements, then the claims may have been payable.  A smaller proportion of improper payments are claims where HHS determines that the Medicaid payment should not have been made or should have been made in a different amount and are considered a known monetary loss to the program.

Figure 6 provides information on Medicaid improper payments that are a known monetary loss to the program (i.e., provider not enrolled, incorrect coding, and other errors).  In the figure, “Unknown” represents payments where there was insufficient or no documentation to support the payment as proper or a known monetary loss.  For example, it represents claims where information was missing from the claim or states did not follow appropriate processes.  These are payments where more information is needed to determine if the claims were payable or if they should be considered monetary losses to the program.

Figure 6: FY 2017 Medicaid Percentage and Improper Payments (in Millions) by Monetary Loss and Type of PERM Error1

1 Note that the Proxy Eligibility Estimate includes both overpayments and underpayments, whereas Known Monetary Loss and Unknown only include overpayments.  The value of non-eligibility underpayments was too small to show up in the figure.

Eligibility Review Pilot Findings

The eligibility review pilots identify vulnerabilities in state processes and systems.  States then take action to address these vulnerabilities, which is essential to preventing future improper payments and improving verification processes.  In the most recent round of pilots, states continued to identify vulnerabilities related to caseworkers or systems not properly establishing income level.  However, these vulnerabilities did not always lead to eligibility determination errors.  States also identified issues related to failures in sending appropriate notices, delays in processing eligibility determinations, and failing to follow verification plans that outline each state’s verification policies and procedures.  States are implementing corrective action strategies and focusing on targeted caseworker training, systems fixes, and maintaining records as the pilots continue.  More information can be found at Medicaid and CHIP Eligibility Review Pilots.

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11.42 Medicaid CAP

HHS works closely with all states to develop state-specific CAPs.  All states are responsible for implementing, monitoring, and evaluating the effectiveness of their CAPs, with assistance and oversight from HHS.  When developing the CAPs, states focus their efforts on the major causes of improper payments where the state can clearly identify patterns.

HHS also establishes corrective actions to reduce improper payments.  For example, HHS is actively engaging with states by:  conducting outreach during off-cycle PERM measurement years to address issues identified in CAPs; facilitating national best practice calls to share ideas across states; offering ongoing technical assistance; and providing additional guidance as needed.  Additional information on states’ and HHS’s corrective actions are provided below.

Corrective Actions to Address OMB Root Causes:

Root Causes: Administrative or Process Errors Made by State or Local Agency and Failure to Verify

Administrative or process errors made by states or local agencies and failure to verify mainly consist of errors resulting from non-compliance with provider enrollment, screening, and NPI requirements described above.

Because these errors primarily drive the Medicaid improper payment estimate, state CAPs focus on system or process changes to reduce these errors.  Specific actions include implementing new claims processing edits, converting to a more sophisticated claims processing system, and continuing to implement process improvements to the provider enrollment process to make it easier for ordering and referring providers to enroll in the program.  For example, state Medicaid agencies may rely on Medicare’s enrollment and screening of providers and on Medicare’s site visits, where the provider is enrolled in Medicare and Medicaid.

In addition to the development, execution, and evaluation of the state-specific CAPs, HHS has implemented corrective actions to specifically address compliance with Medicaid provider screening, enrollment, and revalidation efforts to reduce errors related to this category:

• State Medicaid Provider Screening and Enrollment: HHS shares Medicare data to assist states with meeting Medicaid screening and enrollment requirements.  Specifically, HHS shares with states the Medicare provider enrollment record via the Provider Enrollment, Chain and Ownership System (PECOS) administrative interface and via data extracts from the PECOS system and Office of Inspector General (OIG) exclusion data.  Since May 2016, HHS has offered a data compare service that allows a state to rely on Medicare’s screening, in lieu of conducting state screening, particularly during revalidation.  This allows states to remove dually enrolled providers from their revalidation workload.  Using the data compare service, a state provides an extract of Medicaid provider enrollment data to HHS and then HHS returns information indicating which providers the state can rely on Medicare’s screening.  Alabama, Arizona, California, Idaho, Iowa, Louisiana, Maine, Michigan, New Mexico, New York, Ohio, Oregon, Pennsylvania, Texas, the District of Columbia, Vermont, and Virginia have participated in the data compare service.

• Enhanced Assistance on State Medicaid Provider Screening and Enrollment: HHS provides ongoing guidance, education, and outreach to states on federal requirements for Medicaid enrollment and screening.  In addition, HHS updated the Medicaid Provider Enrollment Compendium in 2017 to provide additional sub-regulatory guidance to assist states in applying the regulatory requirements.
  • Technical Assistance for Provider Screening and Enrollment: In FY 2016, HHS procured a State Assessment contractor to assist with ongoing state technical assistance and process improvements related to provider screening and enrollment.  In FY 2017, the State Assessment contractor visited Alabama, California, Connecticut, Indiana, Iowa, Nevada, Ohio, Oregon, and Texas.  For these states, the contractor assessed compliance with provider screening and enrollment requirements, conducted a gap analysis, and developed strategic blueprints to help states improve processes.
  • Site Visits: HHS continued to conduct state site visits during FY 2017 to assess provider screening and enrollment compliance, provide technical assistance, and offer states the opportunity to leverage Medicare screening and enrollment activities.  In addition to the State Assessment contractor visits, HHS internally provided screening and enrollment assistance through visits to Delaware, Georgia, Minnesota, Missouri, North Carolina, South Carolina, Virginia, and the District of Columbia in FY 2017.
  • Death Master File: To help alleviate state concerns with the cost of completing the SSA DMF check as part of provider screening, HHS worked with the SSA to provide the DMF to states.  In May 2017, HHS made DMF data available to pilot states via the same file server where states currently also access PECOS provider file extracts, Medicare revocations, Medicaid terminations, and OIG sanctions (i.e., suspensions, debarments, and exclusions).  HHS has begun expanding access to the DMF data to additional states, beyond the pilot states, and will continue to do so throughout FY 2018. 
• Medicaid Integrity Institute: HHS offers training, technical assistance, and support to state Medicaid program integrity officials through the Medicaid Integrity Institute.  The FY 2017 course schedule included a seminar in April 2017 that focused exclusively on complying with the provider screening and enrollment requirements.  More information can be found at Medicaid Integrity Institute.

Root Causes: Insufficient Documentation to Determine and Administrative or Process Errors Made by Other Party

Insufficient documentation to determine errors mainly consist of errors resulting from insufficient or no medical documentation submitted by providers.  Administrative or process errors made by other party mainly consist of other provider errors identified through medical review.  State CAPs also include provider communication and education to reduce errors related to these categories.  These methods include: holding provider training sessions and meetings with provider associations; issuing provider notices, bulletins, newsletters, alerts, and surveys; implementing improvements and clarifications to written state policies emphasizing documentation requirements; and performing more provider audits to identify areas of vulnerability and target solutions.

In addition to the development, execution, and evaluation of the state-specific CAPs, HHS has implemented additional efforts to lower the improper payment rate in these two error categories:

• State Medicaid RAC Programs: From inception of the Medicaid RAC program in 2012 to the end of FY 2017, 47 states and the District of Columbia had cumulatively implemented Medicaid RAC programs to identify and recover overpayments and identify underpayments in their Medicaid programs.  However, each state has the flexibility to tailor its RAC program, where appropriate, with guidance from HHS.  For example, several states that had implemented Medicaid RAC programs ended their RAC programs when HHS approved an exception because of the high proportion of beneficiaries enrolled in Medicaid managed care compared to FFS.  As a result, 12 states currently have time-limited HHS-approved exceptions to Medicaid RAC implementation due to high managed care penetration, resulting in a total of 38 states and the District of Columbia that currently have RAC programs.
• Expanded Reviews/Oversight: HHS aligned state Program Integrity Reviews with off-cycle PERM reviews to maintain continuous oversight of states’ corrective actions.  During FY 2017, HHS completed its assessment of the status of states’ PERM CAPs submitted in FY 2013 and provided feedback to states on actions needed to complete their CAPs.  HHS also collected information in FY 2017 on the status of PERM CAPs submitted in FY 2014 related to Medicaid FFS and managed care, and expects to complete assessment and corresponding feedback to states on further corrective actions needed by December 2017.  In FY 2018, HHS will collect, assess, and provide feedback to states on the status of PERM CAPs submitted in FY 2015 related to Medicaid FFS and managed care.  Also during FY 2017, HHS conducted focused reviews in selected states on program integrity in managed care, Medicaid RAC implementation, safeguards in personal care services, terminated providers that should no longer be billing Medicaid, and on states’ completion of corrective actions from previous program integrity reviews.
• Education: In FY 2017, HHS continued to maintain and provide educational resources in various formats to stakeholders on the Medicaid Program Integrity Education website.  In FY 2017, HHS awarded a contract to address the educational needs of Medicaid stakeholders, provide educational resources on emerging trends, and maintain an online resource for stakeholders.  Historically, HHS has published a variety of educational toolkits, which include presentations, fact sheets, and booklets that were made specifically for providers or beneficiaries.  These educational resources are intended to educate providers, beneficiaries, and other stakeholders in promoting best practices and raising awareness of Medicaid fraud, waste, and abuse.

Root Cause: Medical Necessity

Although this has been identified as a minor issue seen in a few states, HHS works closely with those states to develop state-specific corrective actions to address such errors when they arise.  In addition to the state-specific CAPs, many of the corrective actions discussed above also address medical necessity errors.

11.43 Medicaid Information Systems and Other Infrastructure

Because Medicaid payments occur at the state level, information systems and other infrastructure needed to reduce Medicaid improper payments would need to be implemented at the state level.  HHS has encouraged and supported state efforts to modernize and improve state Medicaid Management Information Systems, which will produce greater efficiencies in areas reflected in the PERM measurement and strengthen program integrity.  In addition, HHS has approved enhanced federal funding for nine states to implement predictive analytics technologies that are integrated with state Medicaid Management Information Systems.  Lastly, the state systems workgroup (composed of HHS and state staff representatives) meets regularly to identify and discuss system vulnerabilities and the impact on the measurement of improper payments.

HHS developed a comprehensive plan to modernize the federal Medicaid and CHIP data systems.  The plan’s primary goal is to leverage technologies to create an authoritative and comprehensive Medicaid and CHIP data structure so that HHS can provide more effective oversight of its programs.  The plan will also reduce state burden and provide more robust data for the PERM program.

HHS also developed the Transformed Medicaid Statistical Information System (T-MSIS) to facilitate state submission of timely claims data to HHS, expand the MSIS dataset, and allow HHS to review the completeness and quality of state MSIS submittals in real-time.  Through the use of T-MSIS, HHS will acquire higher quality data and reduce data requests to the states.  As of September 13, 2017, 47 states are submitting data into T-MSIS production, with the remaining states expected to submit data in the T-MSIS file format by early calendar year 2018.  More information on states’ overall progress transitioning can be found at T-MSIS.

11.44 Medicaid Statutory or Regulatory Barriers that Could Limit Corrective Actions

HHS has not identified statutory or regulatory barriers that could limit corrective actions.

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11.50 CHIP

11.51 CHIP Statistical Sampling Process

HHS estimates CHIP improper payments on a federal FY basis and measures three components:  FFS, managed care, and eligibility.  HHS, through its use of federal contractors, measures the FFS and managed care components.  The eligibility component measurement is paused, as described in the eligibility component section below.

CHIP utilizes the same state sampling process as Medicaid through the PERM program.  HHS determined that CHIP can be measured in the same states selected for Medicaid review each FY with a high probability that the CHIP improper payment rate will meet the IPIA required confidence and precision levels.  For information on how HHS grouped states into three cycles, refer to page 183 of HHS's FY 2012 AFR.

FFS and Managed Care Components

States submit quarterly adjudicated claims data from which a randomly selected sample of FFS claims and managed care payments are drawn each quarter.  Each selected FFS claim is subjected to a medical and data processing review.  Managed care payments are only subjected to a data processing review.  The FFS sample size was between 302 and 996 claims per state and the managed care sample size was between 101 and 241 payments per state.  When a FFS component or managed care component for a state accounted for less than 2 percent of the state’s total CHIP expenditures, HHS combined the state’s FFS and managed care claims into one component for sampling and measurement purposes.

Eligibility Component

In light of changes to the way states adjudicate beneficiary eligibility for CHIP under current law, HHS updated the eligibility component measurement methodology and published a final rule (82 FR 31158, July 5, 2017).  For the purpose of computing the overall national improper payment rate, the CHIP eligibility component improper payment rate is held constant at the FY 2014 national rate of 4.22 percent.  HHS will resume the eligibility component measurement under the new rule and report an updated national eligibility improper payment estimate in FY 2019.  Please see Section 11.41 for more information.

Calculations and Findings

The national CHIP improper payment estimate combines each state’s FFS, managed care, and eligibility improper payment estimate.  In addition, individual state component improper payment estimates are combined to calculate the national component improper payment estimates.  National component improper payment rates and the CHIP improper payment rate are weighted by state size, such that a state with a $1 billion program is appropriately weighted more in the national rate than a state with a $200 million program.  A correction factor ensures that CHIP eligibility improper payments are not “double counted.”  Additionally, HHS incorporates state-level improper payment rate recalculations for the states measured in prior FYs into the national CHIP improper payment rate.  For example, subsequent to FY 2015 reporting, HHS recalculated 12 state-level FFS improper payment rates to reflect appeal results and documentation that HHS received after the reporting deadline, but within the allowable timeframes for claims paid between October 1, 2014 and September 30, 2015.  HHS incorporated these recalculations into FY 2017 improper payment rate reporting.

The national CHIP gross improper payment estimate for FY 2017 is 8.64 percent or $1.24 billion.  The FY 2017 net improper payment estimate is 8.55 percent or $1.22 billion.

The FY 2017 national CHIP improper payment rate for each component is:

• CHIP FFS: 10.29 percent
• CHIP managed care: 1.62 percent

Similar to Medicaid, HHS began reviewing against provider screening, enrollment, and NPI requirements (described further in Section 11.41) for FY 2014 improper payment reporting.  In FYs 2014 and 2015, the CHIP improper payment estimate increased when HHS reviewed the first two cycles of states against the new requirements.  FY 2016 represented the first “baseline” improper payment rate reflecting the new requirements because all 50 states and the District of Columbia were measured under the same requirements.  FY 2017 represents the first cycle of states that has been measured a second time.

The CHIP improper payment estimate increased from 7.99 percent in FY 2016 to 8.64 percent in FY 2017 due to continued state difficulties coming into compliance with the provider screening, enrollment, and NPI requirements.  The CHIP FFS improper payment rate for non-compliance with these requirements increased for these states from 4.69 percent in FY 2014 to 5.73 percent in FY 2017.  A higher percentage of CHIP providers are not enrolled in Medicare and, therefore, there are more CHIP providers where states cannot rely on Medicare’s screening in lieu of conducting state screening.  Additionally, managed care improper payments increased in FY 2017 due to recipients that aged out of CHIP, yet continued to receive medical coverage.

Monetary Loss Findings 

Improper payments do not necessarily represent expenses that should not have occurred.  Instances where there is insufficient or no documentation to support the payment as proper are cited as improper payments.  A majority of CHIP improper payments were due to instances where information required for payment was missing from the claim and/or states did not follow the appropriate process for enrolling providers.  However, these improper payments do not necessarily represent payments to illegitimate providers and, if the missing information had been on the claim and/or had the state complied with the enrollment requirements, then the claims may have been payable in whole or in part.  A smaller proportion of improper payments are claims where HHS determines that the CHIP payment should not have been made or should have been made in a different amount and are considered a known monetary loss to the program.

Figure 7 provides information on CHIP improper payments that are a known monetary loss to the program (i.e., provider not enrolled, incorrect coding, and other errors).  In the figure, “Unknown” represents payments where there was insufficient or no documentation to support the payment as proper or a known monetary loss.  For example, it represents claims where information was missing from the claim or states did not follow appropriate processes.  These are payments where more information is needed to determine if the claims were payable or if they should be considered monetary losses to the program.

Figure 7: FY 2017 CHIP Percentage and Improper Payments (in Millions) by Monetary Loss and Type of PERM Error1

1 Note that the Proxy Eligibility Estimate includes both overpayments and underpayments, whereas Known Monetary Loss and Unknown only include overpayments.  The value of non-eligibility underpayments was too small to show up in the figure.  In addition, due to rounding, figures in this chart may not add up precisely to other tables in this document.

Eligibility Review Pilot Findings

Please refer to Section 11.41 for information on the Medicaid and CHIP eligibility review pilots.

11.52 CHIP CAP

HHS works closely with all states to develop state-specific CAPs.  All states are responsible for implementing, monitoring, and evaluating the effectiveness of their CAPs, with assistance and oversight from HHS.  When developing the CAPs, states focus their efforts on the major causes of improper payments where the state can clearly identify patterns.  HHS also establishes corrective actions to reduce improper payments.  For example, HHS is actively engaging with states to address these root causes by: conducting outreach during off-cycle PERM measurement years to address issues identified in CAPs; facilitating national best practice calls to share ideas across states; offering ongoing technical assistance; and providing additional guidance as needed.  Additional information on states’ and HHS’s corrective actions are provided below.

Corrective Actions to Address Root Causes:

Root Causes: Administrative or Process Errors Made by State or Local Agency

Administrative or process errors made by states or local agencies errors mainly consist of errors resulting from non-compliance with provider enrollment, screening, and NPI requirements described above.  This root cause category also consists of errors resulting from payments made to non-covered beneficiaries.  These errors include payments made to recipients that aged out of CHIP and instances where the state’s financial system paid based on an incorrect eligibility status.  In many instances where the financial system paid based on the incorrect eligibility status, the state’s eligibility system indicated that the beneficiary was eligible for Medicaid.

Since the CHIP improper payment rate was primarily driven by these errors, state CAPs focus on system or process changes to reduce these errors.  Specific actions include implementing new claims processing edits, converting to a more sophisticated claims processing system, and implementing a new provider enrollment process to make it easier for ordering and referring providers to enroll in the program.

In addition to the development, execution, and evaluation of the state-specific CAPs, HHS has implemented generalized corrective actions to reduce errors related to this category.  HHS’s efforts include allowing states to rely on Medicare’s enrollment screening of providers to help prevent PERM-related enrollment errors, sharing Medicare data to assist states with meeting screening and enrollment requirements, and providing ongoing education and outreach to states on federal requirements for enrollment and screening.  More detailed information on these activities is provided in Section 11.42: Medicaid CAP.

Root Causes:  Insufficient Documentation to Determine and Administrative or Process Errors Made by Other Party

Insufficient documentation to determine errors mainly consist of errors resulting from insufficient or no medical documentation submitted by providers.  Administrative or process errors made by other party mainly consist of other provider errors identified through medical review.  State CAPs include provider communication and education to reduce errors related to these categories.  These methods include: holding provider training sessions and meetings with provider associations; issuing provider notices, bulletins, newsletters, alerts, and surveys; implementing improvements and clarifications to written state policies emphasizing documentation requirements; and performing more provider audits to identify areas of vulnerability and target solutions.

In addition to the development, execution, and evaluation of the state-specific CAPs, HHS has implemented additional efforts to lower the improper payment rate in these two error categories.  More detailed information on these activities is provided in Section 11.42: Medicaid CAP.

Root Cause: Medical Necessity

Although this has been identified as a minor issue seen in a few states, HHS works closely with those states to develop state-specific corrective actions to address such errors when they arise.  In addition to the development, execution, and evaluation of the state-specific CAPs, many of the CAPs mentioned in further detail in Section 11.42: Medicaid CAP also address issues with medical necessity.

11.53 CHIP Information Systems and Other Infrastructure

Since CHIP payments occur at the state level, information systems and other infrastructure needed to reduce CHIP improper payments would need to be implemented at the state level.  Please refer to Section 11.43: Medicaid Information Systems and Other Infrastructure for information on HHS and state-led efforts to modernize information and data systems at the national and state level.

11.54 CHIP Statutory or Regulatory Barriers that Could Limit Corrective Actions

HHS has not identified statutory or regulatory barriers that could limit corrective actions.

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11.60 TANF

11.61 TANF Statistical Sampling Process

Statutory limitations preclude HHS from requiring states to participate in a TANF improper payment measurement.  As a result, the TANF program is not reporting an improper payment estimate for FY 2017.

11.62 TANF CAP

Since TANF is a state-administered program, corrective actions that could help reduce improper payments would have to be implemented at the state level.  As HHS cannot require states to participate in a TANF improper payment measurement, HHS is also unable to compel states to collect the required information to implement and report on corrective actions.  Despite these limitations, HHS uses a multi-faceted approach to support states in improving TANF program integrity and to prevent improper payments:

• Single Audit Findings:  HHS works with states to analyze Single Audit material non-compliance findings related to TANF and to implement corrective actions to address these findings. 
• Risk Assessment:  In FY 2016, HHS performed a detailed risk assessment of the TANF program to determine susceptibility to significant improper payments.  As part of this process, HHS identified potential payment risks at the federal level and worked to mitigate these payment risks in FY 2017.  For example, HHS refers states to an Information Memorandum (IM) on strategies for reducing TANF improper payments (TANF-ACF-IM-2010-02) and disseminates information through other technical assistance resources. 
• Promoting and Supporting Innovation in TANF Data: In FY 2017, HHS awarded a five-year contract for Promoting and Supporting Innovation in TANF Data.  One component of the contract will be engaging TANF stakeholders to better understand how states assess proper payments and ensure program integrity in TANF.  This assessment will help HHS understand existing state approaches and alternative approaches to measuring TANF improper payments, including the feasibility and cost-benefit analysis of different approaches. 
• Final Regulation on Reporting of Electronic Benefit Transfer Policies and Practices:  In FY 2016, HHS issued final regulations regarding “State Reporting on Policies and Practices to Prevent the Use of TANF Funds in Electronic Benefit Transfer Transactions in Specified Locations” (81 FR 2092, January 15, 2016).  The regulations require states, subject to penalty, to maintain policies and practices that prevent TANF funded assistance from being used in any electronic benefit transfer transaction in specified locations: liquor stores; any casino, gambling casino, or gaming establishment; and any retail establishment that provides adult-oriented entertainment in which performers disrobe or perform in an unclothed state for entertainment. 

11.63 TANF Information Systems and Other Infrastructure

Information systems and other infrastructure needed to reduce TANF improper payments would need to be implemented at the state level.  States utilize PARIS, the National Directory of New Hires, and the Income and Eligibility Verification System to minimize improper payments.

11.64 TANF Statutory or Regulatory Barriers that Could Limit Corrective Actions

Statutory limitations preclude HHS from requiring states to participate in a TANF improper payment measurement.

11.70 Foster Care

11.71 Foster Care Statistical Sampling Process

There were no changes to the statistical sampling process for Title IV-EFoster Care in FY 2017.  This program has taken the review cycle already in place (in compliance with 45 CFR 1356.71, Foster Care Eligibility Reviews) and, with OMB approval, leveraged the existing review cycle to provide a rolling, three-year weighted average improper payment estimate.  Since each state is reviewed every 3 years, each year’s improper payments estimate incorporates new review data for approximately one-third of the states for the period under review.  For a more detailed description of the Foster Care improper payment methodology, refer to pages 189 – 190 of HHS's FY 2012 AFR.

As stated in the FY 2015 AFR, an increasing number of time-limited child welfare waiver demonstration projects (all of which must terminate no later than September 30, 2019 under current law) have temporarily reduced the number of jurisdictions subject to review and inclusion in the program improper payment estimate during the demonstration projects.  More information on these demonstration projects—and their impact on the Foster Care improper payment rate calculation—can be found on pages 202-203 of the FY 2015 AFR.

The program’s improper payment estimate includes data from the most recent review for states with non-statewide waivers, including subsequent reviews conducted on the non-waiver populations in those states following waiver implementation.  This approach, approved by OMB, maintains continuity while also permitting consistent treatment of states with statewide and non-statewide waivers.  Following this approach, the FY 2017 estimate is based on review data for 39 states operating traditional Title IV-E programs.  The FY 2017 estimate excludes data for thirteen states operating statewide waiver demonstrations: four states that were due for a review this year (Hawaii, Kentucky, Washington, and West Virginia) and nine states that were due for a review in prior years (Arkansas, Colorado, District of Columbia, Florida, Indiana, Nebraska, Oklahoma, Utah, and Wisconsin).

The Foster Care gross improper payment estimate for FY 2017 is 7.13 percent or $53.28 million.  The FY 2017 net improper payment estimate is 6.69 percent or $49.97 million.  The primary factor that drove the program’s slight increase from the prior year’s estimate of 6.89 percent was the performance of one state with a relatively large program (sixth largest in terms of Title IV-E payments) that HHS reviewed this cycle.  This state, which has a comparatively large influence on overall program performance due to its program size, had an improper payment estimate of over 18 percent.  Had performance in this state remained at its previous level (i.e., 7.15 percent), the FY 2017 Foster Care improper payment estimate would have fallen to 6.44 percent this year.  Ten of the 12 states reviewed in the most recent cycle had improper payment estimates below 3.25 percent.

11.72 Foster Care CAP

All payment errors (100 percent) in the Title IV-E Foster Care program are administrative or process errors due to incorrect case classification and payment processing by state agencies.  The Foster Care program designs CAPs to help states address the payment errors that contribute most to Title IV-E improper payments.

Corrective Actions to Address Root Cause:

Root Cause: Administrative or Process Error Made by State or Local Agency

Corrective actions have decreased the number of payment errors and altered the composition of identified payment errors.  For example, following years of work with State Court Improvement Programs and outreach to raise awareness, judiciary-related errors, once the most prevalent error type, are now among the least common.

Monitoring and Analysis: HHS continues to monitor, review results, and analyze the types of payment errors in the Foster Care program to target corrective action planning.  In FY 2017, the most common payment errors included:

• Other ineligible payments (30 percent of errors);
• Underpayments (12 percent of errors);
• No safety documentation for institutional caregiver staff (10 percent of errors);
• Provider not licensed or approved (10 percent of errors);
• Excess or duplicate payments (8 percent of errors); and
• Family not eligible for the Aid to Families with Dependent Children program at time of removal (7 percent of errors).

Together these six items account for 77 percent of Foster Care payment errors.  Although “other ineligible payments” constitute 30 percent of errors, over 70 percent of those errors come from just one small state, which, due to the size of its program, has relatively little impact on overall program improper payments.  Nevertheless, this state will need to focus its Program Improvement Plan (PIP) on eliminating these claims, most of which trace to unallowable transportation costs claimed as foster care maintenance.  (Some of these costs might have been allowable if claimed as foster care administration, but did not meet the definition of an allowable cost for foster care maintenance payments.)  Underpayments represent 12 percent of all errors in terms of frequency; however, the dollar amount of the underpayments is quite small as underpayments contribute just 0.22 percent to the gross improper payment estimate of 7.13 percent in FY 2017.  In contrast, because of the high cost of institutional care relative to other foster care placements, the dollar amount of improper payments related to cases lacking safety documentation for institutional caregiver staff is high.  Preliminary analysis suggests that cases with these payment errors contribute over 4 percent to the gross improper payment estimate of 7.13 percent.  (Note: Because cases may have more than one type of overpayment error, the rate for any specific type of overpayment may involve some duplication and therefore slight overestimation.)  More information on the relative contribution of these top six types of payment errors can be found in Figure 8 below.

Figure 8: Title IV-E Foster Care Program: Reasons for Improper Payments across All States – FY 2017 Frequency and Dollar Amount Across Error Types

In FY 2017, HHS undertook the following key actions to reduce improper payments in the future:

• Emphasizing Quality Improvement: HHS engaged with title IV-E agencies to enhance the understanding of program compliance requirements and to share strategies that have proven successful in other states.  Based on discussions with individual states on review preparation and compliance results, HHS worked with states to emphasize and develop strategies for continuous program improvement with an emphasis on: viewing the quality assurance process as an ongoing process, and developing sound program improvements that support systemic change and sustain the improvement effort.
• Enhancing Targeted Outreach Strategies:
  • Pre-Review Engagement of States: Since certain types of improper payments, such as those pertaining to foster care provider requirements, occur in a small number of states, HHS implemented pre-review outreach strategies (e.g., calls and site visits) tailored to particular state child welfare agencies to provide feedback about specific program performance areas needing improvement and facilitate efforts to correct them.  For example, HHS conducted a series of state-specific calls with program leaders in each of the 12 states in the recent review cycle to discuss state policy and systemic factors supporting compliance with federal eligibility and payment requirements.  HHS also visited five of the 12 states prior to the onsite review to examine and provide feedback on state documentation of safety checks for staff of child care institutions given the comparatively high-dollar impact of errors pertaining to institutional care.  The practice of pre-review site visits began in one region 5 years ago and was instituted more broadly beginning in early 2016.  The state visits focused on the federal requirements to increase state agency staff and foster care providers’ knowledge of the requirements, help the state identify missing or insufficient documentation, and help the state eliminate payment errors involving inadequate documentation of safety checks.
  • Education to Address Specific Errors: In response to the FY 2017 improper payment performance, HHS will conduct two webinars in early FY 2018 to advance federal and state staff knowledge on the federal safety check requirements.  The webinars will discuss challenges and solutions in meeting the requirements, and encourage effective communication of the requirements between Title IV-E agency staff and licensing agencies to further promote adequate documentation of safety check compliance.

In addition, HHS continued the following ongoing corrective actions:

• Conducting Eligibility Reviews and Providing Feedback to State Agencies: HHS conducts onsite and post-site review activities to validate the accuracy of state claims for reimbursement of payments made on behalf of children and their Foster Care providers.  Specific feedback is provided onsite to the state agency to affect proper and efficient program administration and implementation.  Furthermore, HHS issues a comprehensive final report that presents findings of the review to the state agency including whether the state exceeded the error threshold in a review and must develop a PIP.
• Developing PIPs: HHS requires states that exceed the error threshold in a review to develop and execute state-specific PIPs that identify the specific action steps necessary to target and correct root causes of the errors.  Each action strategy must be completed within one year from the date HHS approved the plan.  In FY 2017, two of the 12 states reviewed were out of compliance and will complete a PIP.  PIPs are an effective strategy because, since FY 2004 improper payments reporting, only one state has been found not in compliance on an eligibility review conducted following PIP completion.
• Providing Training and Technical Assistance: HHS provides training and technical assistance to states to develop and implement program improvements, even when states are not required to develop a PIP.  This assistance helps states expand organizational capacity and promote more effective program operations.  In FY 2017, HHS trained all of the 12 states reviewed on the federal eligibility and payment requirements and provided technical assistance prior to, during, and after the Foster Care Eligibility Reviews.
• Conducting Secondary Reviews and Disallowances: HHS conducts secondary reviews for non-compliant states and takes appropriate disallowances consistent with the review findings (HHS takes disallowances for error findings in both primary and secondary reviews).  Two states reviewed in the FY 2017 cycle will undergo a secondary review.  On a secondary review, if a state is found not in substantial compliance, HHS takes an extrapolated disallowance.  These additional disallowances, in conjunction with the PIP development and implementation, incentivize states to improve compliance.

11.73 Foster Care Information Systems and Other Infrastructure

HHS uses the Adoption and Foster Care Analysis and Reporting System to draw samples for the regulatory reviews.  This reduces the burden on states to draw their own samples, promotes uniformity in sample selection, and employs the database in a practical and beneficial manner.  Since Foster Care payments occur at the state level, information systems and other infrastructure needed to reduce Foster Care improper payments would need to be implemented at the state level.  States have the option to receive federal financial participation to develop and implement a Comprehensive Child Welfare Information System in accordance with federal regulations at 45 CFR §1355.50 through §1355.59.  Comprehensive Child Welfare Information System project requirements include, among others, the performance of automated program eligibility determinations and bi-directional data exchanges with systems generating the financial payments and claims to ensure the availability of needed supporting documentation.

11.74 Foster Care Statutory or Regulatory Barriers that Could Limit Corrective Actions

HHS has not identified statutory or regulatory barriers that could limit corrective actions.

11.80 Child Care and Development Fund (CCDF)

11.81 CCDF Statistical Sampling Process

The CCDF improper payments methodology uses a case-record review process to determine if child care subsidies were properly paid for services provided to eligible families.  All states, and the District of Columbia and Puerto Rico, are divided into three cohorts and conduct the error rate review once every 3 years.  In addition to federal rules, states have varying requirements for establishing and verifying eligibility.  The methodology enables states to determine the types of errors and their sources to reflect the policies and procedures unique to each state.  For the CCDF improper payments methodology, please see Improper Payments Error Rate Review Process.

The current methodology incorporates the following: (a) drawing a statistical sample from a universe of paid cases; (b) measuring improper payments; and (c) requiring states with improper payment estimates exceeding 10 percent to submit a CAP.  The improper payment methodology and reporting requirements focus on administrative errors associated with client eligibility.  The CCDF gross improper payment estimate for FY 2017 is 4.13 percent or $237.32 million.  The FY 2017 net improper payment estimate is 3.57 percent or $204.97 million.

There were several contributing factors to the slight decrease in the improper payment estimate from 4.34 percent in FY 2016.  While all states are updating their policies and procedures to ensure compliance with implementation of CCDBG), most states reporting in FY 2017 (referred to as Year One states) had not put new policies in place, which potentially kept their improper payment estimates lower.  HHS anticipates that as states establish new policies in accordance with new regulations promulgated in September 2016, it will likely take some time for states and child care providers to understand, implement, and follow the new requirements.  Therefore, the CCDF’s program errors may increase as states implement and are evaluated against the new policies.

11.82 CCDF CAP

Insufficient documentation errors account for an estimated 66 percent of errors identified in the CCDF improper payment review process.  Errors were primarily due to missing or insufficient documentation in the case record.  The most frequently cited errors due to missing or insufficient documentation include:

• Activity schedules or hours of care needed (8 states);
• Paystubs or income verification (8 states); and
• Certifications or recertifications (2 states).

Administrative or process errors represent approximately 34 percent of errors found in the Year One reviews.  These errors consist of the failure to apply policy correctly, including:

• Income calculation (15 states);
• Provider’s payment rate (5 states);
• Level of care or need for care (4 states);
• Parent fee (4 states); and
• Misapplication of policy (2 states).

Corrective Actions to Address Root Causes: 

Root Causes: Insufficient Documentation to Determine and Administrative or Process Errors Made by State or Local Agency

HHS and states have established corrective actions targeting both error types.  States are required to report on the root causes of errors once every 3 years.  Each report also allows states to report on actions taken as the result of errors from the prior review.  States reporting in FY 2017 plan the following actions to correct both missing or insufficient documentation and administrative or process error types:

• Conducting training with eligibility staff on CCDF policies and procedures (14 states);
• Conducting ongoing case reviews or audits (14 states);
• Making changes or updates to state eligibility policies and procedures (7 states);
• Upgrading or enhancing information technology (IT) systems (4 states); and
• Developing job aids or tools to assist eligibility staff (4 states).

HHS has limited authority to require specific actions of state grantees.  As resources allow, HHS provides additional onsite and remote oversight of policy and procedure implementation to achieve compliance with the CCDBG statute and CCDF regulations.  In addition, HHS has implemented other corrective actions to assist all states in their review process and error reduction including the following activities:

• Oversight: All reporting states take part in a Joint Case Review process that is part of HHS oversight.  This new review process was piloted in FY 2016 with Year Three states and expanded to all reporting states in FY 2017.  HHS gains insight into the implementation of the error methodology and provides additional technical assistance to states to ensure consistent  reviews;
• Site Visits:  HHS visits states needing assistance to address root causes of errors as resources allow;
• Technical Assistance:
  • Regulations: HHS provides technical assistance to states around policy and procedure changes to meet new requirements under the CCDBG.  The Office of Child Care’s National Center on Subsidy Innovation and Accountability, which was funded to specifically provide technical assistance to states and territories on program integrity and  accountability, and has been targeting technical assistance to states as it relates to reauthorization;
  • IT:  HHS delivers technical assistance to states regarding updating or developing IT systems that will improve practices and reduce errors; and
• Methodology Training:  HHS provides training on the methodology that allows states to learn best practices from each other as they conduct the improper payment reviews.

11.83 CCDF Information Systems and Other Infrastructure

Since CCDF payments occur at the state level, information systems and other infrastructure needed to reduce CCDF improper payments would need to be implemented at the state level.  In addition to the efforts outlined in prior HHS AFRs, states have taken many steps to improve their IT systems and infrastructure.  In FY 2017, states reported a range of other improvements to information systems including:

• Fourteen Year One states utilize IT systems that assist in eligibility determination and authorization, with the following capabilities:
  • Data matches and syncing with other systems, including those from outside agencies (9 states);
  • Automatic determination of the payment rate (4 states);
  • Automatic eligibility determination (4 states); and
  • Document scanning and storage (2 states).
• Nine Year One states utilize IT systems containing information on providers or provider payments, including the following:
  • Payment management and tracking (8 states); and
  • Provider and licensing information (7 states).
• Eleven Year One states described other IT system capabilities that assist in reducing errors and improper payments, including the following:
  • Flags and blocks for avoiding eligibility errors (8 states); and
  • Flags or blocks for avoiding issuance of improper payments (5 states).
• One Year One state described limitations with an outdated system.
• Seven Year One states have plans for updates, enhancements, or new systems.

11.84 CCDF Statutory or Regulatory Barriers that Could Limit Corrective Actions

The CCDBG Act, signed into law in November 2014, reauthorized CCDF for the first time since 1996.  The statute improves the quality and access to care for children across the country by requiring states to change eligibility to a minimum of 12 months, revise redetermination policies, update provider payment rates and payment practices, and increase health and safety standards for providers.  States will be required to create new policies and procedures to enact the requirements of the law, which may increase errors as the changes are implemented.  CCDF regulations (issued in September 2016) will also require several changes for state programs.  Many states will need to pass legislative packages to enact the requirements under the regulations.  Others are updating policy and procedure manuals and creating staff training and program oversight methods.

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Also see these sections of the Agency Financial Report:

• Section I: Management, Discussion and Analysis
• Section II: Financial Section
• Section III: Other Information - Subsection 1
• Section III: Other Information - Subsection 2
• Section III: Other Information - Subsection 3
• Section III: Other Information - Subsection 5
• Appendices

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