Payment Error Rate Measurement

Oregon's first review of Medicaid billing accuracy under the new Payment Error Rate Measurement will take place in 2008.

The Payment Error Rate Measurement (PERM) is a federal review authorized by the Improper Payments Information Act of 2002 (Public Law No. 107-300). Under the act, federal agencies must review programs that are at risk for payment errors, which include Medicaid and State Children’s Health Insurance Programs (SCHIP).

The Centers for Medicare and Medicaid Services (CMS) will review each state once every three years.

Three independent contractors will conduct the reviews for CMS. These contractors will work directly with the state and its providers during the review process. For more information about the CMS contractor’s see question #5 in our frequently asked questions (FAQ).

There are two components to PERM, the provider claims reviews and the eligibility reviews. During the provider claims review, Oregon Medicaid and SCHIP claims will be randomly selected for review. About 750 will be reviewed each quarter beginning with claims that were paid or denied between October 1 and December 31, 2007. Oregon providers whose claims are randomly selected may be asked to shoiw records for those claims. You can find more information about claim reviews in our FAQs. 

When the review is completed, CMS will compute state and national error rates and report its findings to the states.

PERM Contacts: