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What Are Medicare Contractors and How Do They Help with Appeals?

October 6, 2016

Medicare relies on private health care insurers  to support Original Medicare (Part A and Part B) administrative duties, such as claims processing, appeals handling, and provider contracting. Both Medicare Administrative Contractors (MACs) and Qualified Independent Contractors (QICs) are involved in the appeal process. The Centers for Medicare & Medicaid Services (CMS), the federal body that manages the Medicare program, provides oversight of Medicare contractors.

MACs are private health care insurers awarded a geographic jurisdiction to process Medicare Part A and Part B (A/B) medical claims or Durable Medical Equipment (DME) claims for Medicare Fee-For-Service (FFS) beneficiaries.

If you have Original Medicare, Part A (hospital insurance) and Part B (medical insurance) and decide to appeal a coverage or payment decision, MACs are involved in the first stage of this process, known as redetermination. To find the MAC for your state, see the Contractor Directory on CMS.gov. You can also refer to your Medicare Summary Notice (sent to you every three months) for contact information and a summary of your claims processed by the MAC during the preceding quarter. You’ll generally get a decision from the MAC, called a “Medicare Redetermination Notice,” within 60 days after the MAC receives your request.

If you disagree with the MAC’s decision, you have 180 days after you receive the notice to request a reconsideration by a Qualified Independent Contractor (QIC).  The QIC, an independent contractor not involved in the first-level (redetermination) decision, reviews your appeal and typically sends you a Medicare Reconsideration Notice within 60 days after receiving your appeal. The redetermination notice includes the QIC’s decision regarding your appeal as well as the QIC’s contact information. For additional information, please refer to Medicare Rights, Appeals, and Complaints.

What Medicare contractors do

Medicare administrative contractors have many responsibilities, such as:

  • Process Medicare FFS claims (e.g., hospital, providers, suppliers, home health and hospice)
  • Review medical records for selected claims
  • Establish local coverage determinations (LCD’s)
  • Make and account for Medicare FFS payments to beneficiaries and providers
  • Enroll providers in the Medicare FFS program
  • Handle provider reimbursement services and audit institutional provider cost reports
  • Handle redetermination requests (1st stage appeals process)
  • Respond to provider inquiries
  • Educate providers about Medicare FFS billing requirements
  • Coordinate with CMS and other FFS contractors
  • Perform billing/accounting functions
  • Investigate potential fraud
  • Provide customer assistance to Medicare beneficiaries

Also, MACs work closely with hospitals and doctors to ensure that Medicare coverage and payment requirements are met.

Medicare contractor competitive bidding process

All Medicare administrative contracts are open to a competitive bidding process no less frequently than once every five years. CMS is required to select Medicare contractors based on both price and performance evaluations. Any contract renewal must demonstrate that the Medicare contractor exceeded performance requirements. The Medicare Modernization Act requires each Medicare contractor have a compliance program in place to monitor its conduct and to ensure that it follows the requirements of the Medicare program. Medicare contractors must also submit to periodic audits and quality assurance reviews.

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