ACP Responds to CMS RFI on Potential MAC Consolidation

Expressing concern for the impact on patient care, ACP asked for additional information and plans for increasing staffing for new enrollment, claims and appeals processes

Oct. 25, 2024 (ACP) -- The Centers for Medicare & Medicaid Services recently released a Request for Information (RFI) on the potential consolidation of four Medicare Administrative Contractor (MAC) jurisdictions into two and the extension of MAC contracts from the current seven years to 10 years.

“MACs are private health care insurers that have been awarded a multi-state, geographic jurisdiction to process Medicare Part A and Part B medical claims for Medicare Fee-For-Service (FFS) beneficiaries,” said Dejaih Johnson, ACP manager of regulatory affairs. “Some of the responsibilities of MACs include processing claims, enrolling clinicians in Medicare FFS, physician reimbursement, auditing cost reports, responding to physician inquiries, educating clinicians about billing requirements and establishing local coverage determinations.”

According to CMS, there are currently 12 jurisdictional MACs, four of which process home health and hospice claims in addition to traditional Medicare Part A and B claims. About half of all Medicare beneficiaries are enrolled in FFS Medicare, meaning that MACs directly impact about 34 million Medicare FFS beneficiaries.

In September 2024, CMS released an RFI regarding the potential consolidation of four MAC jurisdictions into two. ACP responded in an Oct. 4 letter.

“ACP is very concerned about the proposed consolidation and asked for additional information and rationale from CMS given that consolidation in other areas of the health care system has been in the spotlight due to concerns about patient access and cost. The agency did not explain why it is considering consolidation at this time, and ACP worries that performance and quality issues might be pervasive,” Johnson said. “We have urged CMS to lay out the steps to increase staffing and the potential burden of new enrollment, claims and appeals processes. We've also urged the agency to consider the potential negative impact on patient care, which is often a byproduct of decreased competition.”

In addition, ACP requested further clarification on the contract structure. “Currently, CMS awards seven-year contracts for MACs, one base year with six potential option years. This approach has helped to ensure that poorly performing MACs would be incentivized to improve and that quality and performance measures could be routinely reviewed, Johnson explained. “ACP requested that this structure stay in place and recommended that if re-assessed, contracts be awarded a base year and nine optional years to drive program stability. MACs need to be evaluated regularly. The potential extension of these contracts from seven to 10 years could decrease incentives, negatively affecting innovation and development and magnifying poor performance.”

ACP also took the opportunity to caution CMS regarding cybersecurity issues that might arise with the consolidation of MACs. “Just in February, there was a data breach that compromised protected health information for nearly a million Medicare beneficiaries and resulted in significant disruptions across the health care system,” Johnson said. “We are concerned that both beneficiaries and clinicians would be negatively impacted due to these large-scale breaches and that a greater number of Medicare beneficiaries could potentially be impacted as a result of consolidation.”

The ACP response to the RFI aligns with its ongoing advocacy to increase transparency and elevate the physician's voice. “As consolidation has come to the spotlight, the College has urged the federal agencies to exercise caution and careful planning,” Johnson said. “As part of ACP's Patients Before Paperwork initiative, we have prioritized burden reduction efforts and supported policies that combat waste and inefficiencies. We need greater clarity on the proposed transition to consolidated jurisdictions, how staffing, processing, and education gaps will be addressed and the reasoning behind the proposals. Without careful consideration and planning on behalf of CMS, ACP is concerned that physicians will be forced to spend additional time processing paperwork and tending to other administrative tasks impacted by the transition. Physicians should be spending their time delivering high-quality care to their patients, and any proposed consolidation must consider the impact on administrative burden, costs, and patient care.”

The timeline going forward is unclear. “CMS did not provide any indication of what its next steps will be or when we can expect to hear updates from them,” Johnson said. “If CMS were to move forward with a substantial change like this, there must be sufficient lead time for physicians to prepare and proper channels established to ensure that all key information is communicated well before the consolidation.”