Billing Errors identified in FY 2016 Payment Error Rate Measurement (PERM) Audit in North Carolina

Author: Office of Compliance and Program Integrity

The Payment Error Rate Measurement (PERM) audit calculates error rates for Medicaid, Children’s Health Insurance Programs (CHIP) and Managed Care on a three-year cycle for the Centers for Medicare & Medicaid Services (CMS). The error rates are based on reviews of the fee-for-service (FFS), managed care, and eligibility components of those three programs in the fiscal year under review.

Note: NC Health Choice (NCHC) is the state’s CHIP program.

The PERM audit for Federal Fiscal Year (FFY) 2016 reviewed claims for service dates between Oct. 1, 2015 – Sept. 30, 2016.

Most of North Carolina’s FFY 2016 errors were due to the following provider billing errors:

  • Missing or insufficient documentation to support the service billed
  • Required document missing from the medical record
  • Procedure Coding Error
  • Incorrect date of service (DOS) billed
  • Attending, rendering or ordering provider not enrolled in Medicaid, CHIP or Managed Care
  • Duplicate claim submissions

Providers can reduce the likelihood of future billing errors by:

  • Using the NCTracks Provider Portal to access web-based tutorials, classes and training materials to educate themselves and their billing personnel on all aspects of claims submission
  • Implementing an internal quality assurance program which includes regular review for the billing errors listed above
  • Incorporating review of claims submissions as a component of any internal quality assurance program
  • Identifying overpayments as part of a voluntary self-audit (also see self-audit overview document)
  • Reviewing Medicaid’s monthly Medicaid Bulletin to stay abreast of changes that may impact billing.

Office of Compliance and Program Integrity
DMA, 919-814-0000

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