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Effective Date: April 1, 2009

Approval Date: ____________ 15

Under NJ FamilyCare Plans B, C and D there are requirements concerning fraud and abuse that do not apply under the Medicaid/Plan A program. Specifically, family members may lose NJ FamilyCare eligibility if the family is found to have engaged in program fraud and abuse. For example, card loaning as a means to pay for services provided to a non-eligible child may result in disenrollment from the program.

For the portion of the care covered by the managed care contracts, the existing system of utilization controls used by the Medicaid managed care program will be in effect. HMOs must have a written Quality Management Program, which also includes a Utilization Review Plan approved by the Division of Medical Assistance and Health Services. An annual External Quality Review that meets the requirements of 42 CFR 438 Subpart E is performed by a qualified External Quality Review Organization each managed care organization.

The administrative infrastructure, quality operating systems, provider networks and the health care delivery system of all HMOs are reviewed and approved before contracting. All HMOs contracting with the State have referral systems for specialty care and prior authorization requirements for certain elective services to further monitor and control unnecessary utilization of services.

Clinical practice guidelines are utilized by the HMOs for their internal monitoring of the delivery of care by HMO providers.

The State, through its ongoing monitoring process conducts audits jointly with a contracted independent Peer Review Organization of each HMO's utilization control systems and contract compliance to ensure that all utilization control standards are met. The audits are comprehensive reviews of HMO operations that meet with the standards at 42 CFR 438 Subpart E, with additional modifications to meet New Jersey's needs. Further additions are made to the review process on an individual HMO basis to address HMO-specific issues and concerns identified through complaints, data from other types of quality reviews, and member satisfaction surveys.

The State also collects comprehensive member- and provider-specific encounter data from the HMOs. These data allow the State to develop utilization reports to compare services within a single HMO against an accepted norm, as well as to compare services across all contracted HMOs. Financial data reported by the plans as well as onsite reviews of financial records by State staff provide the State with information on the cost efficiencies of each HMO.