CMS awards final ZPIC contracts to Cahaba Safeguard Administrators

On October 18, Ted Doolittle, the CMS Deputy Director of Policy Center for Program Integrity, co-presented The Effect of Medicare Audits on Ancillary Healthcare

Providers and Physicians at the American Bar Association’s 9th Annual Washington Healthcare Summit in Arlington, Virginia.  Mr. Doolittle announced that the remaining two ZPIC zones (#3 and #6) have been awarded to Cahaba Safeguard Administrators, LLC.

Zone 3 consists of the states of  Minnesota, Wisconsin, Illinois, Indiana, Michigan, Ohio and Kentucky.  Zone 6 consists of all of the states in the Northeast from Maine to Maryland.  The official release (“Zone Program Integrity Contract Cycle Three”) may be accessed here.

Cahaba Safeguard is a healthcare cost containment/auditing firm with corporate offices in Birmingham, AL, and regional offices in Morrisville, NC and Des Moines, IA.  In 2009, Cahaba had protested the award of a contract to (then) AdvanceMed Corp., of Rockville, Maryland, in Zone 1 and Zone 2 per RFP-CMS-2008-0014. Cahaba argued that CMS “unreasonably concluded that AdvanceMed proposed an adequate strategy to mitigate its ‘impaired objectivity’ organizational conflicts of interest (OCI) and that the agency held unequal discussions with offerors”.  In January of 2010, the GAO sustained the protest on the basis that the agency”failed to reasonably consider the awardees’ proposed strategy to mitigate its conflicts”.  Zone 1 was awarded to SafeGuard Services, LLC, with AdvanceMed eventually securing the Zone 2 contract.

Now all seven ZPIC zones,  which cover the entire United States based on MAC jurisdictions, have been contracted.  CMS had awarded contracts previously as follows:

Zone 1 – SafeGuard Services, LLC

Zone 2 – NCI, Inc. (previously AdvanceMed)

Zone 4 – Health Integrity, LLC

Zone 5 – NCI, Inc. (previously AdvanceMed)

Zone 7 – SafeGuard Services, LLC

In creating the first zones, CMS had targeted areas in which fraud and abuse have been more prevalent. For instance, Zone 7 is devoted almost solely to Florida, considered a “hot zone” because of a high incidence of Medicare fraud. In particular, Miami-Dade, Broward and Palm Beach counties have been designated as high risk areas by CMS. Comparatively, Zone 2 covers a vast territory of largely western and southwestern states where there has not historically been a high prevalence of Medicare.  Other “hot zones” include California (particularly, Los Angeles, Kern, Orange, Riverside, San Bernardino and San Diego counties) and Texas (Houston and Dallas) among other locations.

A map of the zones may be found here.

ZPIC Zones Map

VGM urges providers to review Preparing for the Inevitable: A Practical Guide to ZPIC Prepayment Audit Process,  a white paper prepared for VGM members by Edward Vishnevetsky, an associate with the law firm of Munsch, Hardt, Kopf & Harr, P.C.  Please direct your questions or concerns regarding the ZPIC prepayment audit process to