. What is the difference between Medicare Advantage and traditional Medicare?
2. What is a special investigation unit (SIU)?
3. Under certain circumstances, the CMS may wish to perform its own audits of a Sponsor’s or FDR’s activities pertaining to any aspect of the services provided or amounts payable under its Medicare contract. It has the right to do this, and the Sponsor must allow access to any auditor acting on behalf of the CMS or other federal government agency to conduct an on-site audit. What items will be the subject of a typical CMS audit?
4. It is not always easy for a plan sponsor to identify which of its contracted partners qualify as FDRs. The CMS recommends that the Sponsor take certain factors into account. Name four of them and explain.

Chapter 22
Medicare Advantage

Learning Objectives
Operations of Medicare Advantage Organizations (MAO’s)
Responsibility for “FDR entities”
Guidelines for mandatory MAO compliance program
Compliance Officer and Compliance Committee
Agenda of a good compliance training effort
Value of open lines of communication
Effective disciplinary standards
Audits and monitoring to evaluate compliance
Program exclusions and self-reporting

MAO’s are managed care organizations for Medicare beneficiaries. There are 3,500 MA plans serving 12 million beneficiaries – 25% of the total.
Compliance programs are mandatory for MA plans. Although the OIG has issued a Compliance Program Guidance for MAO’s, the primary authority on MA compliance is the Medicare Managed Care Manual (Chapter 21 of the Compliance Program Guidelines).

7 Basic Elements of a Mandatory Compliance Program for MA Plans
Policies, Procedures, and Standards of Conduct
Compliance Officer, Compliance Committee, and High Level Oversight
Effective Training and Education
Effective Lines of Communication
Well-Publicized Disciplinary Standards
System for Routine Monitoring and Auditing
Prompt Response to Compliance Issues

FDR Entities
MAO: Plan Sponsor
F: First Tier Entity
D: Downstream Entities
R: Related Entities
FDR entities may be a sources of compliance problems.
MAO’s must work with those entities to prevent and resolve the problems.

Delegating Compliance to FDRs
Plan Sponsors may enter into contracts with FDRs to provide administrative or health care services to their enrollees.
They may not delegate compliance program functions to them.
Activities that Sponsor may delegate to a FDR entity, but remains responsible for them.
Factors in determining which contractors are FDRs.

Policies, Procedures, and
Standards of Conduct
Code of Conduct – defines ethical, compliant behavior for employees and FDR’s
Policies and procedures – tell employees and FDR’s how to perform their work tasks in conformity with laws and payor requirements
Emphasis is on areas of high compliance risk as identified by the organization and OIG
Important to impose comparable policies and procedures on FDR’s


Compliance Officer, Compliance Committee, & High Level Oversight
Compliance Officer – full-time, report to CEO, final authority on compliance matters, overall management of compliance program
Specific duties, powers, and status within the organization
Compliance Committee – composition, list of responsibilities
Governing board – oversight of compliance efforts and program effectiveness

Effective Training and Education
Two types of mandatory training – General and Fraud, Waste, and Abuse (FWA).
Annually, part of new employee orientation.
Agenda for each type of training.
Training for employees, managers, governing board, FDR’s, temp workers, & volunteers
Various methods of delivery
Proof that training was delivered

Effective Lines of Communication
Between the CO and CC, and e

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