ROBERT L. EHRLICH, JR., Governor

Ch. 394

SUBSECTION (A) OF THIS SECTION. EACH NURSING HOME THAT RECEIVES PAYMENT
FROM THE MEDICAL ASSISTANCE PROGRAM.

(C) THE DEPARTMENT MAY CONDUCT A THIRD PARTY LIABILITY AUDIT OF A
RANDOM SAMPLE OF THE REPORTS OF CREDIT BALANCES REVIEWED UNDER
SUBSECTION (B) OF THIS SECTION.

(D) (1) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION, THE
DEPARTMENT MAY CONDUCT A THIRD PARTY LIABILITY AUDIT OF A NURSING HOME
THAT IS FOUND TO BE NONCOMPLIANT AS A RESULT OF THE AUDIT CONDUCTED
UNDER SUBSECTION (C) OF THIS SECTION.

(2) IN CONDUCTING THE THIRD PARTY LIABILITY AUDIT AUTHORIZED
UNDER PARAGRAPH (1) OF THIS SUBSECTION, THE DEPARTMENT MAY ONLY REVIEW
THE FINANCIAL INFORMATION OF THE NURSING HOME FOR THE 2-YEAR PERIOD
IMMEDIATELY PRIOR TO THE DATE OF THE AUDIT PERIOD IN WHICH THE NURSING
HOME WAS FOUND TO BE NONCOMPLIANT.

(B) A THIRD PARTY LIABILITY AUDIT SHALL BE CONDUCTED AT LEAST ONCE
EVERY 2 YEARS.

(C) THE DEPARTMENT MAY CONTRACT WITH AN ENTITY TO PERFORM THIRD
PARTY LIABILITY AUDITS.

(D) IN CONTRACTING WITH AN ENTITY TO PERFORM THIRD PARTY LIABILITY
AUDITS, THE DEPARTMENT SHALL USE STANDARD PROCUREMENT PROCEDURES.

19-14A-03.

(A) A CONTRACT FOR THE PERFORMANCE OF A THIRD PARTY LIABILITY AUDIT
SHALL INCLUDE:

(1) A BUDGET TO COVER THE ADMINISTRATIVE EXPENSES OF THE
CONTRACTOR;

(2) AN ESTIMATE OF THE AMOUNT OF GENERAL FUNDS THE
DEPARTMENT ANTICIPATES WILL BE RECOVERED THROUGH THE AUDIT; AND

(3) PENALTY TO THE VENDOR IF THE ERROR RATE EXCEEDS 20% AT
THE CONCLUSION OF THE CONTRACT PERIOD.

(B) A THIRD PARTY LIABILITY CONTRACTOR MAY NOT BE COMPENSATED
SOLELY:

(1) ON A CONTINGENCY BASIS; OR

(2) BY A PERCENTAGE OF THE FUNDS RECOVERED THROUGH THE
AUDIT.

(C) EACH CONTRACTOR SHALL COMPLETE AUDIT STATUS REPORTS FOR EACH
AUDIT UNDERTAKEN BY THE CONTRACTOR.

(D) EACH AUDIT STATUS REPORT SHALL:

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