We use the premium reported on the MMR from CMS as the first step in development of the premium that is used for the percent of premium calculation. The algorithm, methodology-blend percentage and rates/factors are posted on the CMS website at cms.gov for all periods.
If we do not receive payment from CMS for a particular member, we do not pay capitation for that member. Typically unpaid CMS premiums occur in the first month of eligibility and the payment is usually received within 60 calendar days.
If the medical group/IPA has unpaid premiums, it must continue to arrange for the member’s medical care and pay for services accordingly.
If CMS does not retroactively pay the premium within 120 calendar days, the medical group/IPA should notify its Physician Advocate with specific information for that member so the non-payment can be pursued with CMS.
We receive premium from CMS based, in part, on the member’s State and County Code (SCC) as reported by CMS. We use the premium reported by CMS as a basis for percent of premium capitation.
CMS may report a member in a different state than the state their assigned medical group/IPA is located. As an example, CMS may report a member’s SCC as Washington, yet their assigned medical group/IPA is in Oregon.
Once the SCC is updated by the CMS system, CMS pays the correct SCC going forward. Typically, CMS does not retroactively adjust premium for changes in SCC.
ESRD premiums are paid using a Risk-Adjusted model. The model provides a 3-tier approach: dialysis status, receiving a transplant, and functioning graft status. CMS communicates these tiers using the Customer’s Risk-Adjusted Factor Type Code.
In addition to the ESRD flag, the flat file reports the member-level Risk-Adjusted Factor Type code to aid the medical group/IPA with identifying their ESRD patient who is our member. The risk-adjusted factor type code is not reported on the image reports. Find more information on CMS.gov.
The working aged adjustment shows as a member specific adjustment in the premium payment we receive from CMS. CMS calculates the working aged adjustment based on a yearly Medicare Secondary Payer (MSP) factor CMS determines. We show this adjustment at the member level on the flat file (1 R record type for adjustments within the six-month retro window and the 3M record type for adjustments beyond the six-month retro window). Find specifics on the CMS Working Aged Program on cms.gov.
CMS deducts a user fee from all MA plans to fund various education programs for Medicare eligible persons. The user fee adjustment shows as a non-member specific adjustment by CMS in our payments from CMS. Every member is allocated the user fee adjustment. CMS might modify the rate monthly, however, typically the percentage changes three times per year. We show this adjustment at the member level on the flat file, 1 R record type, with the field name CMS_User_Fee.
UnitedHealthcare’s MA plans reduce care provider capitation payments for MA membership by 2%.The 2% sequestration reduction is reported at the member level on the flat file, 1 R record type, with the field name called the MSBP.
This is a result of the CMS-announced sequestration reductions of Medicare payments to care providers, facilities and other health care professionals and impacts care provider, facility, ancillary care provider and other professional payments in our MA plans, including Medicare Advantage Dual Special Needs Plans (DSNP).
Capitation reports reflect the “cap premium gross cap” amount. A medical group/IPA and/or capitated facility with a percent of premium contract can request a sample member capitation assessment.
For MA plans, the review reflects the premium received from CMS. It also shows the transactions outlined in the preceding CMS premium sections to calculate the standard services capitation payment.
You may request a sample member capitation assessment no more than once a year.
A medical group/IPA or capitated facility may request one member capitation assessment, covering one month within the last 12-month period, for no more than six members per contract year.
Sample member capitation review results include confidential and proprietary information. The medical group/IPA or capitated facility must sign a confidentiality agreement before receiving a sample member capitation assessment. We only present this information in one of our offices. The confidentiality agreement states that assessment results may not be removed from the premises.
UnitedHealthcare produces capitation using two separate systems:
- Core transaction processing system — Information from this system reflected in the capitation flat file and on the image reports. The summary reports, CP7030 or CP7010, foot to the payment summary.
- Payment system — Information from this system reflects the sum of the core transaction system, system transaction plus any non-system manual adjustments. We provide a capitation payment summary to each medical/IPA care provider group to allow the medical group to reconcile the monthly capitation payment. The payment amount is the sum of (1) the amount from the core transaction processing system, plus (2) any non-system adjustments.
We provide a capitation payment summary to each medical/IPA care provider group to allow the medical group to reconcile the monthly capitation payment. The payment amount is the sum of the amount from the core transaction processing system, plus any non-system adjustments.
We use capitation adjustments in a variety of circumstances. Each adjustment consists of a three-character Capitation Adjustment Code. Each adjustment code has a corresponding description. We use adjustment codes to administer a specific system-generated payment or carve-out per your participation agreement. We also use a code for a non-system adjustment.
The flat file contains only the capitation adjustment code. However, the CP7020 image report contains both the capitation adjustment code and corresponding description.
We will give care providers documentation, as specified in this guide, in support of each Capitation Payment.
An electronic format of non-system manual adjustments and corresponding backup documentation is available on UHCprovider.com. Each adjustment is reported as a separate line item on the payment summary.To force these adjustments through the system, they are typically reversed in the next processing-period, processed as a system adjustment and reported on the flat file and image reports.
The invoice number on the PRA is an indication of the source system from which the transaction originated. Each transaction originated from either the core transaction processing system (NICE) or payment system as a non- system manual adjustment (ORACLE). Each of the source systems follows an invoice numbering convention as follows:
- Core transaction: YYMMPPNNNNSSDD (Example: 1701CO 00013301). This amount will foot to the CP7030 or CP701 0 [image reports]:
- YY — last two [four] digits of the year (06)[(2006)]
- MM — month (06) PP — product type (CO) Commercial [(SH) Medicare]
- NNNN — computer generated sequential number (0001)
- SS — UnitedHealthcare State code (33)
- DD — UnitedHealthcare division code (01)
- Non-system manual adjustment: YYM M PPAAACTN N N N N N I IOSSDD (Example: 0606COALG 1101 [SHQMB] 2345JSC [ZZC] 3301). This amount will not be included in the Capitation Reporting:
- YY — last two digits of the year (06) MM — month (06)
- PP — product type (CO) Commercial [(SH) Medicare]
- AAA — adjustment code (Example MBR would be for a member adjustment.)
- C — transaction count (1)
- T — contract type (1) values include; 1-Primary Care, 2-Facility, 3-Subcap, 4-Third Party
- NNNNNN — care provider number (01 2345)
- II — internal document tracker ( JS) [(ZZ)]
- ORACLE system indicator (C)
- SS — UnitedHealthcare State code (33)
- DD — UnitedHealthcare division code (01)
The MA capitation process uses the member’s date of birth (DOB), as reported by CMS, as a basis for capitation calculations driven by member age.
Extended Retro Process (MA)
CMS sends MA premium payment adjustments to UnitedHealthcare that may span over a 72-month timeframe on the Monthly Membership Report (MMR). Our capitation processing engine can only process retroactivity up to 48 months, regardless of contractual or eligibility limitations on retroactive changes. We apply the premium capitation calculation methodology. These extended retro process adjustments appear on the capitation flat file, 3M record type with the following adjustment codes:
- MMR — Standard retroactive premium payment adjustments.
- MME — Adjustments represent transactions outside of the six-month retro window that error out during the processing of the MMR.
- MMX — Adjustments represent transactions for members that could not be identified during the processing of capitation or are beyond the 48-month system limitation.
- The MME and MMX adjustments processed in subsequent months after they occur, due to the research involved to complete these transactions.