Frequently Asked Questions

The traditional MEQC program at 42 CFR § 431.810 through 431.822 was originally designed to implement sections 1902(a)(4) “Administration Methods for Proper and Efficient Operation of the State Plan” and 1903(u) “Limitation of FFP for Erroneous Medical Assistance Expenditures” of the Social Security Act (the Act). The program required annual state reviews of Medicaid cases identified through a statistically valid statewide sample of cases selected from the state’s eligibility files. The reviews were conducted to determine whether the sampled cases meet applicable Medicaid eligibility requirements. The program evolved over time to allow states the option of selecting specific areas of focus within the Medicaid program for their annual MEQC reviews.

On July 5, 2017, CMS published a final regulation entitled “Changes to the Payment Error Rate Measurement (PERM) and Medicaid Eligibility Quality Control (MEQC) Programs (CMS-Medicaid Coordination of Benefits8- F).” This final rule updated the MEQC and PERM programs based on the changes to Medicaid and Children’s Health Insurance Program eligibility requirements under the Patient Protection and Affordable Care Act. The new regulation has restructured the MEQC program into an ongoing series of pilots that states are required to conduct during the two off-years between triennial PERM review years. The MEQC portions of the regulation are now covered by 42 CFR §§ 431.800-820.

FAQ ID:93416

The regulation requires states to submit a pilot planning document to CMS by November 1 of the year in which each state’s PERM review year ends. The pilot planning document must describe how states will conduct their active and negative case reviews and must be approved by CMS before the MEQC pilots can begin. In addition, the regulation requires states to submit case-level reports and corrective action plans to CMS by August 1 of the year after the MEQC review period ends. The specifications for the MEQC pilot planning documents are provided in the MEQC sub-regulatory guidance effective August 29, 2018. More details on the specifications of the case-level reports and corrective action plans are included in a second round of guidance, MEQC sub-regulatory guidance effective October 22, 2018.

FAQ ID:93421

As reconfigured under the final regulation of July 5, 2017, MEQC will work in conjunction with the Payment Error Rate Measurement (PERM) program. In those years when states undergo their triennial PERM reviews, the states will not conduct MEQC pilots. The latter will only be required in the two off-years between PERM review years. CMS has restructured the MEQC program so that it more effectively complements the PERM program and provides states with the necessary flexibility and opportunity to target specific problems or high-interest areas during the two off-years of the PERM cycle.

FAQ ID:93146

The MEQC requirements on active case reviews generally mirror the requirements of the eligibility component of PERM reviews. The regulation requires that states perform reviews of a sample of active Medicaid and Children’s Health Insurance Program (CHIP) cases to identify new eligibility approvals and renewals that were made in error. As in PERM, states will be required to submit case-level reports on the sampled cases they review and corrective action plans that describe steps taken to remediate the errors found.

However, in contrast to PERM, when states identify errors in their active Medicaid and CHIP cases, they will be required to undertake a payment review. This will consist of a review of all claims paid over the first three months after an erroneous eligibility determination was made, and a summary of the overstated or understated liability. States will in turn be required to submit adjustments to the amount of federal financial participation (FFP) claimed through the CMS-64 reporting process for Medicaid and the CMS-21 reporting process for CHIP. The adjustments are required for identified claims in which too much or too little FFP was received. There is no payment review or re-crediting requirement in PERM, although disallowance of FFP can be taken in states whose PERM error rate exceeds the national threshold of 3% based on a formula described at 42 CFR 431.1010. MEQC contains no such disallowance provision.

The MEQC program also contains one other significant element that is not found in PERM. Besides the requirement that states review at least 400 cases in their active case universe (including a minimum of 200 cases), MEQC requires states to review at least 400 negative case actions. At least 200 of these must be Medicaid and 200 must be CHIP. Negative case actions involve erroneous denials of Medicaid or CHIP eligibility or erroneous terminations from Medicaid or CHIP. This is an area with no PERM counterpart in which states will be developing case-level reporting and corrective actions. Negative case action reviews will not be triggered by PERM findings. Largely for this reason, the regulation requires that states pull their sample of these from the entire Medicaid and CHIP universe of cases. By sampling from the full range of Medicaid and CHIP cases, states should be able to obtain an overview of those sectors in their programs that may be especially vulnerable to improper denials or terminations.

FAQ ID:93196

The PERM/MEQC dates/cycles are as follows:

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CMS = Centers for Medicare & Medicaid Services
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FAQ ID:95156

Generally, information from the Federal data services hub will only be sent in direct response to a call from the requesting entity. However, in the case of verifications conducted by DHS, there can be up to three steps to a verification, the second and third of which will not be in real time. If the step 1 query fails, the Federal data services hub will automatically invoke step 2, and the response may take up to several days. If step 2 fails, the Federal data services hub will notify the requesting entity which will need to submit additional documentation from the applicant for step 3. The step 3 response can take weeks. During this time, the Federal data services hub will regularly poll DHS to see if the response has come back.

Supplemental Links:

• This FAQ was released as part of a larger set. View the full set. (PDF, 104.38 KB)

FAQ ID:93316

Yes, a state should submit multiple workbooks to CMS to provide a complete UPL demonstration for each service category subject to the UPL (Inpatient Hospital services (IPH), Outpatient Hospital services (OPH), Nursing Facility services (NF), Clinic, Institutions for Mental Disease (IMD), Intermediate Care Facilities for Individuals with Intellectual Disabilities (ICF/IID), Psychiatric Residential Treatment Facility (PRTF), and Qualified Practitioner supplemental payments). When submitting UPL demonstrations, the state should use the following naming convention: UPL_<UPL Demo Date Range>_<Service Type Abbreviation>_R<Region Number>_<State Abbreviation>_<Workbook Number>.xls. Here is an example of the naming convention: UPL_20170701-20180630_IP_R01_CT_01.xls.As well, states may submit one separate workbook for each ownership category (state government owned, non-state government owned, and private).

FAQ ID:92241

No. The 75%/25% matching rate for eligibility systems is limited by the statute to activities directly related to an eligibility determination. A level of care assessment is not directly related to the eligibility determination. Although the assessment itself is not eligible for the 75% match, the entry of the level of care result into the eligibility system may be matched at 75%.

Supplemental Links:

• This FAQ was released as part of a larger set. View the full set. (PDF, 295.71 KB)

FAQ ID:92646

No. A disability determination is not directly related to the eligibility determination, even though the outcome of that determination may be used to identify the appropriate eligibility group, financial methodology and the benefits that will be available to the individual. The eligibility group, financial methodology and benefits are based on the state plan, not on the eligibility system. Although the disability determination itself is not eligible for the 75% match, the entry of the disability information into the eligibility system may be matched at 75%. This analysis is based on the SMM Sec. 11276.7 B, which discusses prior authorization and claims processing. The prior authorization itself is not eligible for the 75% match, however the program decision, based on that prior authorization, to pay or not pay a claim that is pending in the system is eligible for the 75% match.

Supplemental Links:

• This FAQ was released as part of a larger set. View the full set. (PDF, 295.71 KB)

FAQ ID:92651

Individuals who assist applicants by facilitating their applications, who perform outreach activities, or who enter application data on behalf of the applicant are not eligible for the 75% match. Only individuals who are authorized by the single state agency to enter data other than application elements into the eligibility system, who have responsibility for evaluating data in order to make an eligibility determination, who are authorized to exercise discretion in the evaluation of data, who are authorized to make an eligibility determination and who are accountable to the single state agency for such determinations are eligible the 75% match for those activities. This includes eligibility workers, whether in house or out-stationed, as long as there is a formal, written agreement with the single state agency that authorizes their eligibility activities and specifies direct lines of accountability to the single state agency. Both intake workers and on-going eligibility workers who meet these requirements may be claimed at 75%, based on appropriate cost allocations.

Supplemental Links:

• This FAQ was released as part of a larger set. View the full set. (PDF, 295.71 KB)

FAQ ID:92656