CMS Selects Wisconsin Company to Administer Medicare Claims

Officials from the Centers for Medicare & Medicaid Services (CMS) announced that Wisconsin Physicians Service Health Insurance Corp. has been awarded a 5-year contract for the combined administration of Part A and Part B Medicare claims payment in Iowa, Kansas, Missouri and Nebraska.

Wisconsin Physicians Service Health Insurance Corp. (WPS), headquartered in Madison, Wis., is the third new Medicare Administrative Contractor (MAC) to be named by CMS as required by the Medicare Modernization Act of 2003 (MMA). By 2011, a total of 15 new Medicare contractors will cover every state and the District of Columbia. The first two contractors are processing Medicare claims in a total of 10 western states.

WPS will serve as the first point of contact for the processing and payment of fee-for-service claims from hospitals, nursing facilities, physicians and practitioners in the four states. The MAC was selected in open competition under federal procurement rules.

“The contract award for WPS is a major step toward improving service to beneficiaries and providers, as well as providing greater administrative efficiency and effectiveness for the original fee-for-service Medicare program,” Herb Kuhn, deputy CMS administrator, said in a press release. “WPS was awarded the contract because it offered the best overall value to the government from both a cost and technical perspective.”

The new contractor will take claims payment work now performed by four fiscal intermediaries and three carriers in the four states. The MAC contract, which has an approximate value of $225 million over 5 years, will fulfill the requirements of the MMA’s contracting reform provisions.

The contract for WPS includes a base period and four one-year options and will provide WPS with an opportunity to earn award fees based on its ability to meet or exceed the performance requirements set by CMS. These requirements are rooted in CMS’ key objectives for the MACs, including enhanced provider customer service, increased payment accuracy, improved provider education and training leading to correct claims submissions, and realized cost savings resulting from efficiencies and innovation. In accordance with the MMA, MAC contracts are to be open for bidding at least every 5 years.

As the MAC contractor, WPS will immediately begin implementation activities and will assume full responsibility for the claims processing work in its four-state jurisdiction no later than Sept. 9, 2008.

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