(a) The Department of Human Services shall consult with the Office of Medicaid Inspector General regarding an activity undertaken by a fiscal intermediary or fiscal agent pertaining to suspected fraud, waste, or abuse.

(b) The department, in consultation with the office, shall:

(1) Develop, test, recommend, and implement methods to strengthen the capability of the Medicaid Management Information System to detect and control fraud, waste, and abuse and improve expenditure accountability;

(2)

(A) Enter into agreement with a fiscal agent in collaboration with the Office of Medicaid Inspector General's data mining technology to develop, test, and implement the new methods under subdivision (b)(1) of this section.

(B) A collaborative agreement with the Office of Medicaid Inspector General under subdivision (b)(2)(A) of this section shall be made with an agent that has demonstrated expertise in the areas addressed by the agreement;

(3)

(A) Develop, test, recommend, and implement an automated process to improve the coordination of benefits between the medical assistance program and other sources of coverage for medical assistance recipients.

(B)

(i) An automated process under subdivision (b)(3)(A) of this section initially shall examine the savings potential to the medical assistance program through retrospective review of claims paid.

(ii) The examination under subdivision (b)(3)(B)(i) of this section shall be completed no later than January 1, 2014.

(iii) If, based upon the initial experience under subdivision (b)(3)(B)(i) of this section, the Medicaid Inspector General deems the automated process to be capable of including or moving to a prospective review with negligible effect on the turnaround of claims for provider payment or on recipient access to services, the inspector in subsequent tests shall examine the savings potential through prospective, pre-claims payment review;

(4) Take all reasonable and necessary actions to intensify the state's current level of monitoring, analyzing, reporting, and responding to medical assistance program claims data maintained by the state's Medicaid Management Information System fiscal agents and ensure that any data abnormalities identified are reported to the office for appropriate action;

(5) Make efforts to improve the utilization of data in order to better assist the office in identifying fraud and abuse within the medical assistance program and to identify and implement further program and patient care reforms for the improvement of the program;

(6) Identify additional data elements that are maintained and otherwise accessible by the state, directly or through any of its contractors, that would, if coordinated with medical assistance data, further assist the office in increasing the effectiveness of data analysis for the management of the medical assistance program;

(7) Provide or arrange in-service training for state and county medical assistance personnel to increase the capability for state and local data analysis to move toward a more cost-effective operation of the medical assistance program;

(8)

(A) No later than January 1, 2014, assist the office in developing, testing, and implementing an automated process for the targeted review of claims, services, and populations or a combination of claims, services, and populations.

(B) A review under subdivision (b)(8)(A) of this section is to identify statistical aberrations in the use or billing of the services and to assist in the development and implementation of measures to ensure that service use and billing are appropriate to recipients' needs; and

(9) Pay providers for underpayments identified through actions of the office.

(c)

(1) The methods developed and recommended under subdivision (b)(1) of this section shall address without limitation the development, testing, and implementation of an automated claims review process that, before payment, shall subject a medical assistance program services claim to review for proper coding and another review as may be necessary.

(2) Services subject to review shall be based on:

(A) The expected cost-effectiveness of reviewing the service;

(B) The capabilities of the automated system for conducting the review; and

(C) The potential to implement the review with negligible effect on the turnaround of claims for provider payment or on recipient access to necessary services.

(3) A review under subdivision (c)(2) of this section shall be designed to provide for the efficient and effective operation of the medical assistance program claims payment system by performing functions, including without limitation:

(A) Capturing coding errors, misjudgments, or incorrect or multiple billing for the same service; and

(B) Possible excesses in billing or service use, whether intentional or unintentional.

(d)

(1) No later than December 1, 2013, the Director of the Department of Human Services in conjunction with the office shall prepare and submit an interim report to the Governor and the cochairs of the Legislative Council on the implementation of the initiatives under this section.

(2) The report under subdivision (d)(1) of this section shall also include a recommendation for a revision that would further facilitate the goals of this section, including recommendations for expansion.

(e) Applicable medical assistance program rules, provider manuals, and administrative policies, procedures, and guidance will be posted on the Office of Medicaid Inspector General website, or by a link from the website to the department's website.