Basic of ZPIC Audit Process

ZPIC stands for Zone Program Integrity Contractor audit. The ZPIC audit helps in looking for frauds which can be referred to the Department of Health & Human Services (HHS) Office of Inspector General (OIG) for consideration of civil or criminal prosecution.

ZPICs can go after everything for audit from single-doc shops to home health to clinics and chiropractors. The Health Insurance Portability and Accountability Act (HIPAA) of 1996 established the Medicare Integrity Program (MIP). The MIP was designed to help the Centers for Medicare & Medicaid Services (CMS) better identify fraud, waste and abuse in the Medicare program. 

ZPIC was created to perform integrity functions in the seven program integrity zones created based on the new established MAC jurisdictions for Medicare Part A and Part B, durable medical equipment prosthetics, orthotics and supplies, home health and hospice and Medicare-Medicaid data matching

The ZPIC auditor will then perform one or more of the following:

• Review of a sample of claims
• Interview a number of patients
• Interview employees at the provider’s office or at home
• Look for previous violations by the provider
• Perform data analysis

ZPIC statement of work states that:

The ZPIC shall review and analyze a variety of data in order to focus its program integrity efforts by identifying vulnerabilities and/or specific providers for review and investigation within its zone, referral of potential fraud, waste and abuse cases to law enforcement, and pursuance of administrative actions. Further, the ZPIC shall be proactive and aggressive in pursuing many different sources and techniques for analyzing data in order to reduce any of its risks within this [Statement of Work].

How ZPIC audit process operates?

In a ZPIC audit, the auditor will typically send a letter requesting documentation for a number of claims. Providers are usually given 30 days to comply. If the ZPIC identifies an overpayment, it will notify the provider’s MAC, which will issue the overpayment demand letter. The provider can pay the overpayment, allow it to be paid via recoupment or appeal. If no payment or request for extended repayment plan is received within 30 days, the
overpayment is delinquent and begins to accrue interest.

The five-level appeals process – redetermination, reconsideration, administrative law judge hearing, department appeals board review and federal court review – is the same as the RAC appeals process. Overpayment collection is prohibited during appeals at the first two levels.

The ZPIC shall provide a variety of data analysis, statistical analysis, and trending activities to enhance the detection and prevention of Medicare and Medicaid potential fraud, waste and abuse in the participating state(s). The ZPIC shall use appropriate CMS Medicare data, as well as data from other sources such as Medicaid data, to reach this end. 

Successful accomplishment shall require a significant amount of cooperation with the participating state(s), law enforcement, and other task orders within the ZPIC zone. It may also require significant cooperation with other ZPICs.

Below are the three main ZPIC audit formats and the potential implications of each.

• Automated AuditsAutomated audits are generally the result of random annual audit quotas as opposed to specific allegations of fraud or abuse. These types of audits usually don’t consist of highly detailed information requests. Instead, the ZPIC will review the information your practice has already submitted. Although the risk of regulatory action emanating from an automated audit is low, it can still happen. If you find yourself undergoing a random audit, it is important that you anticipate and prepare for a possible appeal by working with one of our experienced ZPIC audit lawyers.
• Semi-Automated AuditsSemi-Automated ZPIC audits could be the result of either a random selection or evidence of a potential payment issues. Regardless of the initiating trigger, semi-automated audits are computer-generated reviews accompanied by a request for records and billing documentation – which you should have thoroughly reviewed and prepared by a knowledgeable healthcare attorney prior to submission in order to reduce the risk of future issues.
• Complex AuditsIf a ZPIC auditor or Medicare Administrative Contractor (MAC) identifies a specific issue related to your practice, it may conduct a complex audit. This is the most intensive audit format and will likely consist of a request for extensive evidence of the given claim’s necessity and eligibility as well as the legitimacy of the protocol that was utilized. Usually, a complex audit indicates that the ZPIC or MAC has already detected a pattern of fraud or abuse associated with your business dealings. Due to the high risk associated with this type of audit, it’s best to first consult a ZPIC audit lawyer for assistance in responding to the contractor.

References:

https://federal-lawyer.com/growing-threat-of-zpic-audits/

https://www.homecaremag.com/june-2018/preparing-zpic-audits