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42 C.F.R. § 421.200   Carrier functions.

Title 42 - Public Health

Title 42: Public Health
PART 421—INTERMEDIARIES AND CARRIERS
Subpart C—Carriers

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§ 421.200   Carrier functions.

A contract between CMS and a carrier, other than a regional DMEPOS carrier, specifies the functions to be performed by the carrier which must include, but are not necessarily limited to, the following:

(a) Coverage. (1) The carrier ensures that payment is made only for services that are:

(i) Furnished to Medicare beneficiaries;

(ii) Covered under Medicare; and

(iii) In accordance with QIO determinations when they are services for which the QIO has assumed review responsibility under its contract with CMS.

(2) The carrier takes appropriate action to reject or adjust the claim if—

(i) The carrier or the QIO determines that the services furnished or proposed to be furnished were not reasonable, not medically necessary, or not furnished in the most appropriate setting;

(ii) The carrier determines that the claim does not properly reflect the kind and amount of services furnished.

(b) Payment on a cost basis. If payment is on a cost basis, the carrier must assure that payments are based on reasonable costs, as determined under part 413 of this chapter.

(c) Payment on a charge basis. If payment is on a charge basis, under part 405, subpart E of this chapter, the carrier must ensure that—

(1) Charges are reasonable and not higher than the charge for a comparable service furnished under comparable circumstances to the carrier's policy holders and subscribers; and

(2) The payment is based on one of the following—

(i) An itemized bill.

(ii) An assignment under the terms of which the reasonable charge is the full charge for the service, as specified in §424.55 of this chapter.

(iii) If the beneficiary has died, the procedures set forth in §§424.62 and 424.64 of this chapter.

(d) Fiscal management. The carrier must receive, disburse, and account for funds in making payments under Medicare.

(e) Provider audits. The carrier must audit the records of providers to whom it makes Medicare Part B payments to assure that payments are made properly.

(f) Utilization patterns. (1) The carrier must have methods and procedures for identifying utilization patterns that deviate from professionally established norms and bring the deviant patterns to the attention of appropriate professional groups.

(2) The carrier must assist providers and other persons who furnish Medicare Part B services to—

(i) Develop procedures relating to utilization practices;

(ii) Make studies of the effectiveness of those procedures and devise methods to improve them;

(iii) Apply safeguards against unnecessary utilization of services; and

(iv) Develop procedures for utilization review, and establish groups to perform such reviews of providers to whom it makes Medicare Part B payments.

(g) Information and reports. The carrier must furnish to CMS any information and reports that CMS requests in order to carry out CMS's responsibilities in the administration of the Medicare program. The carrier must be responsive to requests for information from the public.

(h) Maintenance and availability of records. The carrier must maintain and make available to CMS the records necessary for verification of payments and for other related purposes.

(i) Hearings to Part B beneficiaries. (1) The carrier must provide an opportunity for a fair hearing if it denies the beneficiary's request for payment, does not act upon the request with reasonable promptness, or pays less than the amount claimed.

(2) The hearing procedures must be in accordance with part 405, subpart H, of this chapter (Review and Hearing Under the Supplementary Medical Insurance Program).

(j) Other terms and conditions. The carrier must comply with any other terms and conditions included in its contract.

[45 FR 42183, June 23, 1980; 45 FR 64913, Oct. 1, 1980, as amended at 49 FR 3660, Jan. 30, 1984; 49 FR 9174, Mar. 12, 1984; 51 FR 34833, Sept. 30, 1986; 51 FR 41350, Nov. 14, 1986; 51 FR 43198, Dec. 1, 1986; 52 FR 4499, Feb. 12, 1987; 53 FR 6648, Mar. 2, 1988; 54 FR 4027, Jan. 27, 1989; 57 FR 27307, June 18, 1992]

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