Medicare Billing Reform

In 2003, CMS mandated a major change to the administration of Medicare fee-for-service (FFS) benefits. They achieved this with Medicare Contracting Reform, which is included in Section 911 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003. The section requires HHS to replace the current contracting authority of Fiscal Intermediaries (Part A) and Carriers (Part B) with a new Medicare Administrator Contractor (MAC) authority. A Medicare Administrator Contractor (MAC) is responsible for the receipt, processing and payment of all Part A and Part B Medicare FFS claims. In addition to processing claims for payment, the MAC will be the primary contact for physicians and perform functions related to: Appeals, Provider Services, Financial Management, Provider Enrollment, Reimbursement, Payment Safeguards, and Information Systems Security.

Medicare Part A and Part B claims have been processed by separate contractors under the former authority. CMS realized that having to deal with more than one contractor can increase frustration for beneficiaries and providers and can make it difficult to get answers on coverage questions quickly. By combining the administration of Part A and Part B, Medicare will be able to deliver more efficient and effective services to the beneficiaries by integrating both lines of business.

This transition to reform has been a gradual process. The DME MAC contracts have been awarded and Medicare benefits are being administered by the contractors. 8 of the 15 A/B MAC jurisdiction contracts have been awarded, but implementation is ongoing. The HH MAC and remaining 7 A/B MAC contract awards are yet to be assigned to contractors.

MAC contracts are a maximum of 5 years, so there will always be constant transition taking place. Hopefully, to lessen confusion of all these transitions we are providing following maps of the MAC jurisdictions for A/B, DME and HH. In addition we have included an implementation schedule for all Medicare lines of business.

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