Department of Health and Human Services

OFFICE OF

INSPECTOR GENERAL

 

THE MEDICARE-MEDICAID 

(MEDI-MEDI) DATA MATCH 

PROGRAM 

Daniel R. Levinson 

Inspector General

April 2012

OEI-09-08-00370
EXECUTIVE SUMMARY: THE MEDICARE-MEDICAID (MEDI-MEDI) DATA 

MATCH PROGRAM

OEI-09-08-00370

WHY WE DID THIS STUDY 

The Medicare-Medicaid Data Match program (Medi-Medi program) enables program safeguard 

contractors (PSC) and participating State and Federal Government agencies to collaboratively 

analyze billing trends across the Medicare and Medicaid programs to identify potential fraud, 

waste, and abuse. Participation is optional. The Social Security Act mandates that the 

Medi-Medi program increase the effectiveness and efficiency of the Medicare and Medicaid 

programs through cost avoidance (i.e., prepayment denials); savings; and recoupment of 

fraudulent, wasteful, or abusive expenditures. 

HOW WE DID THIS STUDY

We analyzed data collected from the Centers for Medicare & Medicaid Services (CMS), PSCs, 

State Medicaid program integrity agencies, and other Federal and State agencies participating in 

the Medi-Medi program. The period of our review was 2007 and 2008.

WHAT WE FOUND

The Medi-Medi program produced limited results and few fraud referrals. During 2007 and 

2008, the program—in which 10 States had chosen to participate—received $60 million in 

appropriations and it avoided and recouped $57.8 million. The program produced 66 referrals to 

law enforcement, and law enforcement accepted 27 of these. Among the 10 participating States 

collectively, each State averaged 2.8 Medicare referrals to law enforcement per year; law 

enforcement accepted an average of 1.15 referrals per State per year. In comparison, each State

averaged 0.5 Medicaid referrals to law enforcement per year; law enforcement accepted an 

average of 0.2 referrals per State per year. Also, State Medicaid programs received less benefit 

from the Medi-Medi program than Medicare received. Of the $46.2 million total in Medicare 

and Medicaid expenditures recouped through the program during 2007 and 2008, more than

three-quarters—$34.9 million—was recouped for Medicare. 

WHAT WE RECOMMEND

We recommend that CMS reevaluate the goals, structure, and operations of the Medi-Medi

program to determine what aspect of the program, if any, should be part of CMS’s overall 

program integrity strategy. CMS concurred with our recommendation. CMS commented that 

since the period of our review, it has made significant strides in enhancing the effectiveness of 

the Medi-Medi program. However, since our period of review, CMS has not provided any data 

to illustrate enhanced effectiveness, such as the number of referrals, accepted referrals, and the 

actual—not potential—Medicare and Medicaid expenditures avoided and recouped through the 

program. These data would enable Congress to make an informed decision whether to continue 

funding the program and enable State and Federal agencies to make an informed decision 

whether to participate.
TABLE OF CONTENTS

Objectives ....................................................................................................1 

Background ..................................................................................................1 

Methodology ................................................................................................8 

Findings......................................................................................................14 

Although most PSCs performed all of the required tasks, the 

Medi-Medi program produced limited results and few fraud 

referrals ..........................................................................................14 

State Medicaid programs received less benefit from the 

Medi-Medi program than Medicare received ................................17 

Limitations in the administration of the Medi-Medi program 

may have diminished its potential..................................................18 

Recommendation .......................................................................................21 

Agency Comments and Office of Inspector General Response .....22 

Appendixes ................................................................................................23 

A: Sources for Centers for Medicare & Medicaid Services

Requirements for the Medicare-Medicaid Data Match Program ...23 

B: Required Tasks Listed in the Statement of Work and 

Documentation Analyzed To Determine Whether Tasks Were

Performed .......................................................................................24 

C: Analysis Results of Program Safeguard Contractors’ 

Performance of Selected Tasks in the Statement of Work for 

the Medicare-Medicaid Data Match Program ...............................27 

D: Agency Comments ...................................................................29 

Acknowledgments......................................................................................32 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 1

OBJECTIVES 

To determine: 

1. Whether program safeguard contractors (PSC) performed the required 

tasks for the Medicare-Medicaid Data Match program (Medi-Medi 

program).

2. To what extent the Medi-Medi program identified fraud, waste, and 

abuse.

BACKGROUND

Medicare-Medicaid Data Match Program

The Medi-Medi program enables PSCs and participating State and Federal 

Government agencies to collaboratively analyze billing trends across the 

Medicare and Medicaid programs to identify potential fraud, waste, and 

abuse. The PSCs’ primary goal with regard to the Medi-Medi program is 

to identify cases of suspected fraud and take immediate action to ensure 

that monies are not inappropriately paid out and that any inappropriate 

payments are recouped.1

 The purpose of analyzing Medicare and 

Medicaid claims data collectively is to detect aberrant billing patterns that 

may not be evident when analyzing the data separately.

Funding for the Medi-Medi program. After the Centers for Medicare 

& Medicaid Services (CMS) implemented an initial pilot program in one 

State in 2001, nine additional States opted to participate.

2

 Between fiscal 

years (FY) 2001 and 2005, the program received approximately 

$30 million in funding from a combination of Health Care Fraud and 

Abuse Control funds and Federal Bureau of Investigation funds.3 The 

Deficit Reduction Act (DRA) of 2005 established and funded an expanded 

Medi-Medi program, appropriating funding on an FY basis starting in 

2006. In FY 2006, funding was $12 million. By FY 2009, funding had 

increased to $48 million. Starting in FY 2010 and for each subsequent 

1 CMS, Medicare Program Integrity Manual, Pub. 100-08, ch. 4, § 4.2. Accessed at 

https://www.cms.gov/manuals/downloads/pim83c04.pdf on October 25, 2010. 

2 In 2003, Florida, Illinois, New Jersey, North Carolina, Pennsylvania, and Texas joined the program. In 2004, 

Ohio and Washington joined, followed in 2005 by New York. CMS, Medicare-Medicaid Data Match Program 

(Medi-Medi) Policies and Procedures Manual (Medi-Medi PPM), August 20, 2007, p. 3.

3 The Health Insurance Portability and Accountability Act of 1996 established a national Health Care Fraud and 

Abuse Control Program under the joint direction of the Attorney General and the Secretary of Health and 

Human Services (HHS) (acting through the Inspector General). The program was designed to coordinate 

Federal, State, and local law enforcement activities with respect to health care fraud and abuse. HHS and 

Department of Justice, Health Care Fraud and Abuse Control Program Annual Report for Fiscal Year 2010, 

p. 1. Accessed at http://oig.hhs.gov/publications/docs/hcfac/hcfacreport2010.pdf on June 29, 2011. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 2

year, the DRA has funded the program at $60 million per year.4 During 

the period of our review—2007 and 2008—$60 million was appropriated 

to fund the program: $24 million in 2007 and $36 million in 2008.5

Authorities. Section 1893(g) of the Social Security Act (SSA) sets forth the 

requirements for conducting the Medi-Medi program.6 Section 1893(g) 

requires that certain program integrity functions be performed. PSCs are 

expected to perform these functions, which consist of: 

• identifying program vulnerabilities by using computer 

algorithms to look for payment anomalies (including billing or 

billing patterns identified with respect to service, time, or 

patients that appear suspect or otherwise implausible); 

• working with States, the Attorney General, and the Inspector 

General of HHS to coordinate actions to protect the Federal and 

State shares of Medicare and Medicaid expenditures; and

• increasing the effectiveness and efficiency of Medicare and 

Medicaid through cost avoidance (i.e., prepayment denials); 

savings; and recoupment of fraudulent, wasteful, or abusive 

expenditures. 

In addition, section 1893(g)(1)(B) of the SSA requires that, no less 

frequently than quarterly, any data and statistics collected by the 

Medi-Medi program be made available to the Attorney General, the 

Director of the Federal Bureau of Investigation, the Inspector General of 

HHS, and the States (including the Medicaid Fraud Control Units). 

Medi-Medi Statement of Work tasks. To address the requirements in 

section 1893(g) of the SSA, CMS requires PSCs to perform program 

integrity tasks listed in a Medi-Medi Statement of Work (SOW).7 

However, in those SOWs, CMS does not impose minimum output 

standards—national or otherwise—relating to the extent to which PSCs 

make referrals to Federal or State law enforcement agencies or the amount 

of fraud, waste, and abuse expenditures avoided or recouped.8 For each of 

the 10 States that participated during 2007 and 2008, CMS awarded a 

4 P.L. 109-171 § 6034. 

5 DRA § 6034. 

6 Section 6034 of the DRA added section 1893 of the SSA, which permanently established the Medi-Medi 

program at section 1893(g). P.L. 109-171 § 6034.

7 The SOW is a contract between CMS and a PSC. 

8 PSCs are required to submit a monthly status report to CMS identifying the providers being referred to law 

enforcement and indicating whether those referrals were accepted. However, according to CMS Medicare 

program integrity staff, the purpose of collecting these data is to provide them upon request to third parties, such 

as Congress, the Government Accountability Office (GAO), and/or the HHS Office of Inspector General. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 3

SOW to a PSC.9 CMS awarded 10 individual SOWs among 8 PSCs. 

(One PSC was awarded three SOWs.) The SOW is incorporated into each 

PSC’s broader program integrity task order. During 2007 and 2008, 

10 SOW tasks were listed:10

1. Incorporate a project plan

2.

that defines the steps and timelines 

for implementing the Medi-Medi program, including 

identifying resource needs and responsible parties to complete 

the implementation steps. 

Incorporate a detailed information technology plan

3.

identifying 

how the PSC shall receive, store, safeguard, manipulate, and 

analyze data.

Submit to CMS a monthly status report

4.

reflecting the PSC’s 

results from the previous month. Among other information, the 

report must contain information about Medi-Medi program data 

analysis; providers being referred to law enforcement; the 

status of those referrals (i.e., whether law enforcement accepts 

or declines them); outcome of civil or criminal prosecution or 

administrative action; and the amount of Medicare and/or 

Medicaid expenditures avoided and recouped. 

Develop a joint operating agreement

5.

with the State Medicaid 

program integrity agency (and any other necessary parties) to 

establish guidelines, duties, and shared expectations for the 

Medi-Medi program. 

Provide State Medicaid program integrity staff with access

6.

 to 

matched Medicare and Medicaid data within 4 months of 

executing a computer match agreement. 

Analyze data,

7.

 including data matching, trending, and statistical 

activities, to enhance the detection and prevention of Medicare 

and Medicaid fraud and abuse. 

Develop and refer potential fraud cases

9 CMS is transitioning program integrity work from PSCs to Zone Program Integrity Contractors (ZPIC). CMS 

began awarding contracts to ZPICs in September 2008. However, in 2008, the initial transition process 

occurred in only two participating States. The chief difference between PSCs and ZPICs is that ZPICs cover 

broader geographical areas and multiple parts of the Medicare program, whereas PSCs cover more limited areas 

and scopes.

 and/or data leads to the 

appropriate State or Federal law enforcement agencies. 

10 The tasks listed in the SOW for each PSC vary, but not substantially. This list summarizes the 10 tasks 

identified in a SOW. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 4

8. Facilitate a quarterly steering committee11 with Federal and 

State agencies participating in the Medi-Medi program, and 

prepare minutes of those meetings. 

9. Prepare a “lessons learned” report

10.

 discussing matching and 

combining Medicare and Medicaid data.

Perform transition activities, working closely with ZPICs to 

ensure that all program integrity activities continue during the 

transition from PSCs to ZPICs.12 Such activities include (but 

are not limited to) transferring medical records, information on 

investigations and on cases referred to law enforcement, and 

other data to ZPICs.

During the first year that CMS awarded Medi-Medi SOWs to PSCs, it 

required them to perform three of these tasks—incorporating a project 

plan (task #1), incorporating an information technology plan (task #2), and 

preparing “lessons learned” reports (task #9)—on a one-time basis. 

Because all of the SOWs were awarded prior to 2007, each PSC 

performed those three tasks prior to the period of our review. With respect 

to task #10—performing transition activities—only two ZPICs were 

officially awarded SOWs during 2008, according to CMS Medicare 

program integrity staff.13

Administration of the Medi-Medi Program

 One of these two ZPICs had previously 

performed tasks under a SOW as a PSC. The other ZPIC had not, so the 

PSC in that instance was required to perform transition activities. 

Therefore, during 2007 and 2008, nine PSCs were required to perform six 

tasks (tasks #3–8) and the remaining PSC was required to perform seven 

tasks (tasks #3–8 and task #10). 

Even though the purpose of the Medi-Medi program is to address 

vulnerabilities in both Medicare and Medicaid, during 2007 and 2008 the 

Medi-Medi program was administered solely by CMS Medicare program 

integrity staff.14

11 The actual schedule is determined jointly by the applicable PSC, the State Medicaid program integrity 

agency, and other participating Federal and State agencies. 

 In February 2010, CMS announced a reorganization. The 

Medicare integrity program is now administered by the CMS Medicare 

12 According to Medicare program integrity staff, when a PSC under a SOW is subsequently awarded a SOW 

as a ZPIC, the PSC is not required to perform transition activities. This task is required only when the SOW is 

awarded to a ZPIC that is an entity different from the preceding PSC. 

13 Although SOWs were awarded to two ZPICs during 2008, the transition was not completed in 2008. Thus, 

for our 2007–2008 period of review, only PSCs performed the SOW tasks. 

14 Administering the Medi-Medi program includes, but is not limited to, CMS’s procuring funding to award 

SOWs to PSCs, providing program guidance, assessing PSCs, entering into contracts with PSCs, and partnering 

with State Medicaid agencies and other applicable Federal and State law enforcement agencies to facilitate the 

program. CMS, Medi-Medi PPM. The date of the manual is August 20, 2007. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 5

Program Integrity Group; similarly, the CMS Medicaid integrity program is 

now administered by the CMS Medicaid Program Integrity Group. Both of 

these integrity programs fall under the direction of the CMS Center for 

Program Integrity. Despite the reorganization, the Medi-Medi program 

remains administered solely by Medicare—specifically, by the CMS 

Medicare Program Integrity Group. For the purpose of this report, we refer 

to this entity as “the CMS Medicare program integrity staff,” as that was its 

name during the period of our review.

CMS Medi-Medi program guidance. The Medi-Medi PPM provides PSCs, 

State Medicaid program integrity agencies, and Federal and State law 

enforcement agencies with Medi-Medi program guidance, which includes 

(but is not limited to) information relating to:

• identifying the roles and responsibilities of PSCs and participating 

agencies, 

• implementing the Medi-Medi program, 

• data connectivity and sharing, and 

• data matching. 

Law enforcement agencies that typically participate in the Medi-Medi 

program are the Federal Bureau of Investigation, the HHS Office of 

Inspector General, Medicaid Fraud Control Units, and/or State offices of 

Attorneys General (the Medi-Medi partners).15

The Medi-Medi PPM also identifies activities that should be performed by 

State Medicaid program integrity agencies and Medi-Medi partners. 

Although PSCs receive a portion of the Medi-Medi appropriations from 

CMS, States receive no funding to participate and State participation is 

optional.

 

16 However, for the States that do participate in the Medi-Medi 

program, each State’s Medicaid program integrity agency is encouraged to 

complete certain ongoing activities to benefit the program. These include 

(but are not limited to) providing Medicaid policy and data assistance, 

participating in Medi-Medi data work groups, and working on joint 

investigations.17

For those Medi-Medi partners that do participate, the Medi-Medi PPM 

identifies activities that they should perform. They generally include (but 

 

15 For the purpose of this report, these law enforcement agencies will be individually referred to by their proper 

names and collectively referred to as the Medi-Medi partners. Although other State and Federal law 

enforcement agencies may participate, the Medi-Medi partners are the agencies to which PSCs are required to 

make data and statistics available. 

16 According to Medicare program integrity staff, the remaining appropriations are used for Medi-Medi 

program expansion, data systems, and a national Medi-Medi coordinator. 

17 CMS, Medi-Medi PPM, pp. 5-6.
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 6

are not limited to) participating in the steering committee meetings for the 

applicable State, receiving referrals, and providing feedback to the meeting 

attendees about referrals.18

The Medicare Program Integrity Manual also provides PSCs with 

additional guidance on the Medi-Medi program.19 The manual identifies

PSC program integrity requirements, such as the processes for sharing 

fraud referrals with Medi-Medi partners. 

Assessments of PSCs. PSCs are subject to annual assessments by CMS 

Medicare program integrity staff.20

The 2007 and 2008 Program Safeguard Contractor (PSC) Performance 

Evaluation Guidelines (Evaluation Guidelines) provide guidance for 

assessing PSCs’ performance under the broader program integrity task order, 

as well as with regard to the tasks applicable to the Medi-Medi SOW. The 

Evaluation Guidelines provide assessment guidance regarding the following 

six SOW tasks: 

 In addition, CMS assigns a contract 

officer’s technical representative to assess each PSC’s performance. 

• submitting to CMS a monthly status report (task #3), 

• developing a joint operating agreement (task #4), 

• providing remote user support and access (task #5), 

• performing data analysis (task #6), 

• developing and referring potential fraud cases (task #7), and 

• facilitating a steering committee (task #8). 

The Evaluation Guidelines further require that CMS document its 

assessment findings in its PSC BI [Benefit Integrity] Evaluation Control 

Objectives and Findings Tables (Findings Tables).21

The Findings Tables are an internal CMS document that contains the 

comprehensive results of each PSC’s annual assessment. The document 

identifies key elements of the required tasks that need to be completed by the 

PSCs. The Findings Tables contain the review methodology used for rating 

a PSC’s performance, as well as the rating score and assessment findings. 

The ratings range from “0” (unsatisfactory) to “5” (outstanding). CMS 

provides the PSC with an oral summary of the ratings and findings. 

 

18 CMS, Medi-Medi PPM, § 2. 

19 CMS, Medicare Program Integrity Manual, Pub. 100-08, ch. 4. Accessed at 

https://www.cms.gov/manuals/downloads/pim83c04.pdf on October 25, 2010.

20 HHS, Acquisition Policy Memorandum 2009–07, p. 5. 

21 CMS, Program Safeguard Contractor Performance Evaluation Guidelines 2007, p. 45, and CMS, Program 

Safeguard Contractor Performance Evaluation Guidelines 2008, p. 45. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 7

Pursuant to the Federal Acquisition Regulation, CMS summarizes the results 

of the Findings Tables in a Standard Contractor Performance Report

(Performance Report).22 For each assessment of a PSC, CMS submits a 

summary into the National Institutes of Health contractor performance 

system. The Performance Report contains the actual assessment rating score 

and the summarized findings. Although the contractor performance system 

is not accessible to the public, PSCs use this system to review their own 

assessments.23

Current and Planned Sources of Medicare and Medicaid Data

 

In 2007 and 2008, PSCs extracted Medicare claims data through the CMS 

National Claims History files and shared system files. Unlike CMS, 

which collects its Medicaid claims data from each State via the Medicaid 

Statistical Information System (MSIS),24 PSCs obtain Medicaid claims 

data directly from the participating States’ Medicaid Management 

Information Systems (MMIS) to match them to Medicare data. For each 

participating State, the State Medicaid program integrity agency receives 

matched Medicare and Medicaid claims data from the PSC. The matched 

data may also be shared with Medi-Medi partners.

The One PI System

One PI users obtain data from the CMS-managed integrated database 

repository. As of the date of this report, the repository is fully functional for 

accessing data from Medicare Parts A, B, and D; limited provider data; and 

beneficiary data.

. A source for Medicare and Medicaid data that is being 

developed by CMS is the One PI System. (The “PI” in the name stands for 

“Program Integrity.”) According to the Medi-Medi PPM and CMS Medicare 

program integrity staff, the concept of the One PI System is to enable access 

to integrated Medicare and Medicaid data. The Medi-Medi PPM provides 

guidance on using the One PI System. 

25 However, Medicaid data are not yet included. Until 

CMS can integrate Medicaid data into the repository, the One PI System 

cannot be used to collectively match or analyze Medicare and Medicaid data 

for fraud, waste, and abuse. The contract to implement the One PI System 

22 Federal Acquisition Regulation § 42.1501. 

23 CMS uses the National Institutes of Health contractor performance system to record PSC performance. 

However, as of September 30, 2010, the National Institutes of Health stopped its service of accepting 

performance information and encouraged users to transition to the Department of Defense Contractor 

Performance Assessment Reporting System.

24 States are required to submit all their eligibility and claims data to CMS on a quarterly basis through MSIS. 

CMS uses MSIS to collect, manage, analyze, and disseminate information on eligibles, beneficiaries, utilization, 

and payment for services covered by State Medicaid programs. SSA § 1903(r); CMS, Medicaid Statistical 

Information Statistics (MSIS). Accessed at http://www.cms.gov/MSIS/ on January 17, 2011. 

25 The repository provides access to users through a variety of data analysis software tools, such as SAS, 

MicroStrategy, Cognos, Business Objects, and Advantage Suite. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 8

was awarded in September 2006, and the system was to be implemented 

within 5 years at a projected cost of $105 million.26

The Fraud Investigation Database

The Fraud Investigation Database is a nationwide data entry and reporting 

system designed to track Medicare, Medicaid, and Medi-Medi fraud and 

abuse data. Under the Medi-Medi program, PSCs are required to enter into 

the database information about PSC-initiated investigations, cases referred to 

law enforcement, and payment suspensions related to fraud and abuse.27 

State Medicaid program integrity agencies, Medi-Medi partners, and other 

Federal and State law enforcement agencies use the database to access the 

information that PSCs enter into it.

Related Studies

In 2004, GAO issued a report that, in part, provided information about 

CMS’s efforts to support and oversee State program integrity activities, such 

as the Medi-Medi program.28 GAO found that CMS conducted little 

oversight of these activities.

In 2005, GAO released a report that focused on (1) the level of resources 

CMS applied to helping States prevent and detect fraud and abuse in 

Medicaid and (2) the implications of that level of support for CMS fraud and 

abuse control activities.29 GAO found that the expansion of the Medi-Medi 

data match project was slow, potentially leaving unrealized millions of 

dollars in cost avoidance and cost savings. GAO concluded that developing 

a strategic plan for Medicaid fraud and abuse control activities would give 

CMS a basis for providing resources that reflect the financial risk to the 

Federal Government. 

METHODOLOGY

Scope

This evaluation focused on the PSCs’ performance under the SOW during 

the period of 2007 and 2008. We selected this period because CMS had 

completed its own internal assessment of the Medi-Medi program (known as 

26 CMS Medicare program integrity staff and CMS One PI staff. 27 CMS, Medicare Program Integrity Manual, Pub. 100-08, ch. 4, § 4.11. Accessed at 

https://www.cms.gov/manuals/downloads/pim83c04.pdf on May 27, 2010. 

28 GAO, Medicaid Program Integrity: State and Federal Efforts to Prevent and Detect Improper Payments, 

GAO-04-707, July 2004. Accessed at http://www.gao.gov/new.items/d04707.pdf on May 26, 2010. 29 GAO, Medicaid Fraud and Abuse: CMS’s Commitment to Helping States Safeguard Program Dollars Is 

Limited, GAO-05-858T, June 28, 2005. Accessed at http://www.gao.gov/new.items/d05855t.pdf on May 26,

2010. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 9

a “lessons learned” report) for the period preceding 2007.30

We report whether PSCs performed the SOW tasks required in 2007 and 

2008. We also report the number of referrals made to law enforcement 

through the Medi-Medi program and the number that were accepted. In 

addition, we identify the actual dollars associated with Medicare prepayment 

denials and the Medicare and Medicaid dollars recovered. Finally, we report 

the extent to which CMS assessed PSCs’ performance under the SOW. 

 In addition, 

CMS expressed an interest in the results of our independent evaluation from 

2007 and 2008 for its transition from using PSCs for the Medi-Medi 

program to using ZPICs instead. As of the date of this report, the transition 

is still in process. 

Data Collection

We obtained the following from CMS Medicare program integrity staff: 

• sources for CMS requirements for the Medi-Medi program for 2007 and 

2008 (see Appendix A for a list of these documents); 

• documentation (including the Findings Tables and the Performance 

Reports) illustrating the extent to which PSCs performed SOW tasks; 

• documents that PSCs produced as required by 3 of the 10 SOW tasks 

during 2007 and 2008: monthly status reports (required by task #3), 

joint operating agreements (required by task #4), and quarterly minutes 

(for task #8, which requires PSCs to facilitate a joint steering 

committee);31

• the number of referrals made to law enforcement and the number that 

CMS identified as being accepted; and

 

• the dollars associated with Medicare prepayment denials and/or the 

dollars recovered through each State’s Medi-Medi activities.

To validate and supplement the documentation that we obtained from 

Medicare program integrity staff, we: 

• sent questionnaires to and conducted structured in-person interviews 

with CMS Medicare program integrity staff;

30 Optimal Solutions Group L.L.C., Final Lessons Learned Report (HHSM-500-2006-00165G), 

January 29, 2007. 

31 Because all of the SOWs were awarded prior to 2007, each PSC had already been required to complete 

tasks 1, 2, and 9 (incorporating a project plan, incorporating an information technology plan, and preparing a 

“lessons learned” report) and we did not collect these documents during our review. However, we requested 

that CMS Medicare program integrity staff verify through questionnaires and structured interviews that these 

tasks had been completed.
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 10

• conducted structured in-person interviews with CMS One PI staff, an 

official from the Center for Medicaid and State Operations, and contract 

officers’ technical representatives;

32

• conducted structured in-person interviews with staff from each of the 

PSCs;

• conducted structured interviews with staff from each of the 10 State 

Medicaid program integrity agencies that participated in the Medi-Medi 

program (conducting 5 of these 10 interviews in person);33

• conducted structured interviews (by telephone) with staff from a total of 

37 of the potential 41 various Medi-Medi partners associated with the 

10 participating States.

and

34

Data Analysis 

Unit of analysis. Our unit of analysis is the 10 Medi-Medi SOWs awarded 

to PSCs, which correspond to the participating 10 States. For ease of 

reporting, we use the term “10 PSCs” to represent the 10 SOWs awarded 

among 8 PSCs. 

Analysis of the SOW tasks

We reviewed the Medi-Medi program requirements for 2007 and 2008 to 

identify all the requirements related to the SOW tasks. For each PSC, we 

then reviewed the Findings Tables and Performance Reports to determine 

whether CMS had—as required by the Evaluation Guidelines—documented 

the assessments. We also reviewed responses from our structured interviews 

and questionnaires to supplement and/or validate our determination of 

whether the PSC performed the tasks according to the requirements. 

. Even though the 2007 and 2008 SOWs included 

10 tasks, we assessed PSC performance related only to the tasks CMS 

required PSCs to continue to perform in 2007 and 2008. 

For a number of SOW tasks, we applied additional data-analysis 

methodologies: 

• For the requirement that each PSC submit to CMS a monthly status 

report (task #3) and develop a joint operating agreement (task #4), we 

reviewed the 2007 and 2008 monthly status reports and joint operating 

agreements. 

32 We interviewed a Center for Medicaid and State Operations official to gain a Medicaid perspective of the 

Medi-Medi program. Upon enactment of the DRA, the Center for Medicaid and State Operations administered 

the Medicaid integrity program within CMS. 

33 To reduce travel costs, we conducted interviews and reviewed documentation and/or data at 5 of the 10 State 

Medicaid program integrity locations near PSC locations.

34 Although the number of Medi-Medi partners that participated in the interviews varied among States, we 

interviewed at least three Medi-Medi partners from each participating State. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 11

• For the requirement that each PSC perform data analysis (task #6) and 

develop and refer potential fraud cases (task #7), we reviewed 2007 and 

2008 monthly status reports and CMS’s responses to our questionnaires. 

As part of our structured interviews, while onsite at each PSC location, 

we also reviewed various examples of each PSC’s data analysis and case 

development. For the task of performing data analysis, we calculated the 

sum of unique data analysis projects performed by each PSC. These 

projects included identifying patterns of potential Medicare and/or 

Medicaid fraud and performing data analysis targeted to specific 

providers and/or services. A PSC may perform data analysis for a unique 

project over several months. If a PSC reported that it continued to 

perform data analysis for that same project in subsequent months, we 

counted that project for each of those months as one of the unique data 

analysis projects being performed during that month. 

• For the requirement that each PSC facilitate a steering committee 

(task #8), we reviewed minutes from the meetings. 

See Appendix B for documentation and data we analyzed to determine 

whether PSCs performed the required SOW tasks. 

Although CMS rates PSCs’ performance using a system ranging from “0” 

(unsatisfactory) to “5” (outstanding), because of this system’s subjective 

nature, we did not attempt to rate PSC performance. We considered a task 

performed if documentation and/or data existed demonstrating that the task 

was performed.

Analysis of fraud, waste, and abuse identified through the Medi-Medi 

program

We report fraud, waste, and abuse expenditures “avoided” (meaning 

prepayment denials) or “recouped” (meaning funds recovered). This 

terminology is consistent with the language in section 1893(g) of the SSA. 

. We analyzed the responses of CMS Medicare program integrity 

staff to our questionnaire to identify the number of Medicare and Medicaid 

referrals made to Federal and State law enforcement agencies and the 

number that were accepted. In addition, we calculated the amount of 

Medicare and Medicaid expenditures avoided through prepayment denials 

and the amount of dollars recovered. We limited the scope of this analysis to 

actual dollars recovered, as opposed to potential dollars recovered. 

Analysis of the Medi-Medi program assessment process. For each PSC, we 

reviewed the 2007 and 2008 program requirements. We then reviewed the 

2007 and 2008 Findings Tables and Performance Reports to determine the 

extent to which CMS recorded its assessment of each PSC’s performance of 

the required SOW tasks. We also reviewed responses from our structured 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 12

interviews and questionnaires to supplement and/or validate our 

determination of the extent of CMS’s assessment of PSCs’ performance. 

Data Limitations

Each program (Medicare and Medicaid) and each participating State operate 

under different circumstances and/or policies. For example, each 

participating State’s Medi-Medi activities are unique to that State, and 

although PSCs are required in their SOWs to refer potential fraud cases to 

State Medicaid program integrity agencies and/or Federal or State law 

enforcement agencies, PSCs do not control what those entities do with their 

referrals. In addition, there may be more Federal law enforcement agency 

resources available for Medicare than there are State law enforcement 

agency resources available for Medicaid. 

PSCs vary as to how much information on data analysis projects they 

include in their monthly status reports. In addition, the project descriptions 

they include in these reports are not comprehensive and do not necessarily 

identify the providers; the relevant program (i.e., Medicare or Medicaid); or 

the results or disposition of the projects. For example, some reports state 

that a PSC completed a certain number of data requests, without any 

additional information. In other monthly reports, other PSCs list only the 

titles of the data analysis projects. 

PSCs also differ as to what they consider to be a data analysis project. Some 

PSCs include preliminary data analysis projects in their monthly status 

reports, whereas other PSCs list only projects for which they have already 

completed the preliminary data analysis and which they consider viable 

fraud cases. Further, some PSCs have not only listed new data analysis 

projects in their reports, but have also listed ongoing ones. This may explain 

the range in the number of unique data analysis projects performed by PSCs 

each month. 

Because of these limitations in the monthly status reports, we did not attempt 

to correlate the number of unique data analysis projects to the number of 

Medicare and/or Medicaid referrals or to the amount of expenditures avoided 

or recouped. 

PSCs, State Medicaid program integrity agencies, and Medi-Medi partners 

may not always agree as to which of them initiated a referral for fraud, 

waste, or abuse, or which of them was responsible for expenditures that were 

avoided or recouped.35 To minimize the time burden on the State Medicaid 

program integrity agencies and the Medi-Medi partners, we limited their 

35 This statement is based on responses given during our structured interviews with PSCs and State Medicaid 

program integrity agencies. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 13

involvement to structured interviews and did not ask them to verify CMS’s 

reported output. 

Standards

This study was conducted in accordance with the Quality Standards for 

Inspection and Evaluation issued by the Council of the Inspectors General 

on Integrity and Efficiency.
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 14

FINDINGS

Although most PSCs performed all of the required 

tasks, the Medi-Medi program produced limited results 

and few fraud referrals 

For the period of 2007 and 2008, 7 of the 10 PSCs performed all of the 

required SOW tasks while each of the remaining 3 PSCs performed all but 

1 of the required tasks. See Appendix C for our analysis of PSCs’ 

performance of SOW tasks in 2007 and 2008. 

Three of the PSCs did not develop and refer potential fraud 

cases during 1 of the 2 years of the review period

The SOW states that “fraud cases shall be developed” and further states 

that “the PSC shall refer potential fraud cases and/or data leads to the 

appropriate State or Federal law enforcement agency....” Of the three

PSCs that did not perform all of the required tasks, all did not develop and 

refer potential fraud cases in 1 of the 2 years of our review period. Two of 

those three PSCs did not refer any potential Medicare or Medicaid fraud 

cases in 2007. The remaining PSC did not refer any potential cases 

through the program in 2008. 

A total of $60 million was appropriated for the Medi-Medi 

program, and $57.8 million in expenditures were avoided and 

recouped

The DRA appropriated funding for the Medi-Medi program on an 

FY basis. According to CMS Medicare program integrity staff, the actual 

combined total of fraud, waste, and abuse expenditures avoided or 

recouped through the Medi-Medi program during that period was 

$57.8 million (see Table 1). 

Table 1: Combined Totals of 2007 and 2008 Expenditures Avoided and Recouped

Program Expenditures Avoided Expenditures Recouped Total

Medicare $11,593,283 $34,934,559 $46,527,842

Medicaid Not reported36 $11,303,554 $11,303,554

Totals $11,593,283 $46,238,113 $57,831,396

Source: OIG analysis of Medi-Medi data.

36 During 2007 and 2008, CMS did not collect data from PSCs regarding the amount of Medicaid expenditures 

avoided through the Medi-Medi program.
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 15

Of the fraud, waste, and abuse expenditures avoided or 

recouped, 66 percent was attributed to Medi-Medi activities in 

three States

Of the combined $57.8 million in fraud, waste, and abuse expenditures 

avoided or recouped through the Medi-Medi program, a combined total of 

$37.9 million was attributed to Medi-Medi activities in three States; 

individual totals were $14.5 million, $14.3 million, and $9.2 million, 

respectively37 (see Table 2).38

Expenditures avoided. CMS reported that, as a result of the Medi-Medi

program, a total of $11.6 million in Medicare expenditures was avoided 

through prepayment denials during the period of 2007 and 2008. However, 

of this amount, $8.8 million (76 percent) was attributed to Medi-Medi 

activities in one State.

Expenditures recouped

The Medi-Medi program produced only 66 law enforcement 

referrals; 27 were accepted

. During the same period, a total of $46.2 million in 

Medicare and Medicaid expenditures was recouped through the Medi-Medi 

program. However, of this amount, $28.7 million (62 percent) was 

attributed to the same three Medi-Medi programs that recouped and avoided 

$14.5 million, $14.3 million, and $9.2 million, respectively, in total 

Medicare and Medicaid expenditures. 

During 2007 and 2008, a combined total of 66 Medicare and Medicaid 

referrals were made to Federal and State law enforcement through the 

37 Because of rounding, the sum of these figures does not equal $37.9 million.

38 The Medi-Medi programs in Table 2 are ranked by the total amount of Medicare and Medicaid expenditures 

reported as having been avoided or recouped. 

Table 2: Combined 2007 and 2008 Medicare Expenditures Avoided and 

Recouped and Medicaid Expenditures Recouped by Each Medi-Medi Program

Medi-Medi Program Expenditures Avoided Expenditures Recouped Total

1 $8,849,636 $5,666,021 $14,515,657

2 $0 $14,250,957 $14,250,957

3 $364,909 $8,799,834 $9,164,743

4 $991,901 $3,877,993 $4,869,894

5 $0 $4,490,955 $4,490,955

6 $370,499 $3,654,965 $4,025,464

7 $0 $3,000,191 $3,000,191

8 $895,617 $1,285,350 $2,180,967

9 $104,468 $1,211,847 $1,316,315

10 $16,253 $0 $16,253

Total $11,593,283 $46,238,113 $57,831,396

Source: OIG analysis of Medi-Medi data. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 16

Medi-Medi program, and law enforcement accepted 27 of these (see 

Table 3).

As a result of Medi-Medi activities among the 10 States collectively, each 

State averaged 2.8 Medicare referrals to law enforcement per year; an 

average of 1.15 of those referrals were accepted. In comparison, each State 

averaged 0.5 Medicaid referrals to law enforcement per year; an average of 

0.2 of those were accepted.

Medi-Medi activities in a single State produced 27 of the total referrals 

(41 percent) and 10 of the total accepted referrals (37 percent). Of the 

Medi-Medi activities in the 10 States, 41 percent of the total referrals and 

37 percent of the accepted referrals were attributed to Medi-Medi 

activities in a single State (see Table 4). This is the same State that 

recouped $14.3 million total Medicare and Medicaid expenditures during 

2007 and 2008. 

Results from the Medi-Medi program improved slightly between 

2007 and 2008

Between 2007 and 2008, the amount of Medicare expenditures avoided 

through the Medi-Medi program increased by $1.1 million and the amount 

of Medicare expenditures recouped increased by $10 million. During the 

Table 3: Combined 2007 and 2008 Medi-Medi Law Enforcement Referrals

Program Number Referred to 

Law Enforcement

Number Accepted 

by 

Law Enforcement

Percentage Accepted 

by Law Enforcement

Medicare 56 23 41%

Medicaid 10 4 40%

Totals 66 27 41%

Source: OIG analysis of Medi-Medi data.

Table 4: Combined 2007 and 2008 Medi-Medi Law Enforcement Referrals

Medi-Medi Program Referred to 

Law Enforcement

Accepted by 

Law Enforcement

1 27 10

2 8 2

3 7 5 

4 6 3 

5 6 1 

6 4 3 

7 4 1 

8 2 1 

9 1 1

10 1 0 

Total 66 27

Source: OIG analysis of Medi-Medi data. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 17

same period, Medicaid expenditures recouped increased by $4.4 million. 

In addition, the total number of Medicare and Medicaid referrals made to 

Federal and State law enforcement increased by 18, while the number of 

those referrals accepted increased by 5.

State Medicaid programs received less benefit from 

the Medi-Medi program than Medicare received

Compared with Medicare, Medicaid received less benefit from the 

Medi-Medi program. Of the $46.2 million total in Medicare and Medicaid 

expenditures recouped through the Medi-Medi program during 2007 and 

2008, more than three-quarters—$34.9 million—was recouped for Medicare 

and $11.3 million was recouped for Medicaid. Between 2007 and 2008, the 

amount of Medicare expenditures recouped increased by $10 million, while 

the amount recouped for Medicaid increased by $4.4 million. During the 

same period, of the 66 law enforcement referrals made, more than 

five-sixths—56 of the referrals—were for Medicare and 10 were for 

Medicaid. Law enforcement accepted 23 of the Medicare referrals and only 

4 of the Medicaid referrals. 

Although Medi-Medi appropriations were intended to expand the 

program, no new States were participating as of 2008 and two of 

the participating States ultimately withdrew

The DRA provisions were intended to establish and fund an expanded 

Medi-Medi program. However, during the period of our review, only 

10 States had chosen to participate. Of those 10 States, 2 States withdrew, 

finding that it offered them minimal expenditure avoidance and recoupment 

of Medicaid funds.39

After 2008, 7 additional States joined the Medi-Medi program, resulting in a 

total of 15 participating States.

 State participation in the program is voluntary, and 

States must contribute their own resources to participate. One of the two 

States that withdrew reported that it invested $250,000 of its own resources 

in the program, but recouped only $2,000 over a 5-year period (which 

included 2007 and 2008). However, during 2007 and 2008, that State also 

administered its own Medicaid integrity program independent of the 

Medi-Medi program, and this independent program recouped $28.9 million.

40 As a result of the transition to ZPICs, the 

seven additional States joined the Medi-Medi program as part of three 

geographic areas.41

39 Of the two States that withdrew, one withdrew in September 2008 and the other withdrew in January 2010. 

 

40 Information provided by Medicare program integrity staff. 

41 Colorado and Oklahoma were included in one ZPIC geographic area. Arkansas, Georgia, and Mississippi 

were included in a second geographic area, and Iowa and Utah were included in a third geographic area. 

Information provided by Medicare program integrity staff. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 18

During 2007 and 2008, 54 percent of the funds appropriated for the 

Medi-Medi program were used to develop the One PI System, but 

the system will not include Medicaid claims data until at least 2015

In total, $60 million was appropriated to fund the Medi-Medi program during 

2007 and 2008.42 Of this amount, 54 percent ($32.5 million) was used to 

develop the One PI System.43 During 2009 and 2010, $108 million in total was 

appropriated to fund the Medi-Medi program, and an even larger percentage of 

those funds—64 percent ($69 million)—was used to develop the One PI 

System.44

According to CMS Medicare program integrity staff, the lack of appropriate 

Medicaid claims data for CMS to integrate into the integrated data repository

is the main barrier to using the One PI System for the Medi-Medi program. 

CMS currently collects Medicaid claims data from each State via MSIS. 

According to CMS Medicare program integrity staff, MSIS data in their 

current form would not be appropriate to integrate into the integrated data 

repository because the data are specific to each State and lack many of the 

standardized data elements needed for program integrity work.

 However, according to Medicare program integrity staff and CMS 

One PI staff, the One PI System will not be available for the Medi-Medi 

program until at least 2015, 4 years after its originally scheduled 

implementation date. 

45 Some 

examples of standardized data elements needed for program integrity work 

but not included in MSIS are provider names and addresses, information 

about types of procedures and services, and beneficiary names. 

Limitations in the administration of the Medi-Medi 

program may have diminished its potential 

Lack of inclusion of the Medicaid Program Integrity Group in the 

administration of the Medi-Medi program, limitations of the Fraud 

Investigation Database, and the lack of documentation in CMS’s annual 

assessments of PSCs may limit the potential of the Medi-Medi program. 

42 Data provided by CMS One PI staff and Medicare program integrity staff. 

43 Information provided by Medicare program integrity staff. 

44 Ibid.

45 MSIS was designed to collect specific information from each Medicaid agency that would allow CMS to 

report on State Medicaid program characteristics and utilization. According to CMS Medicare program 

integrity staff, MSIS data were not designed to support fraud analytics and they lack standard data elements 

necessary for that purpose. Because of a lack of standardization, the data cannot be used for national analysis. 

CMS anticipates that it will eventually be able to integrate Medicaid claims data into the integrated data 

repository by receiving from States data with common data elements—i.e., definitions, formats, and 

representations will not vary by State. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 19

Federal officials from the CMS Medicare Integrity Group do not 

include Federal officials from the CMS Medicaid Integrity 

Group in administering the Medi-Medi program

The Medi-Medi program is intended to be a collaborative effort to combat 

Medicare and Medicaid fraud, waste, and abuse. However, according to 

CMS Medicare program integrity staff and a former Center for Medicaid and 

State Operations official, although Medicaid program integrity agencies are 

involved at the State level, Federal officials from the CMS Medicare 

Integrity Group do not include Federal officials from the Medicaid Integrity 

Group in administering the Medi-Medi program. 

During structured interviews, 5 of the 10 State Medicaid program integrity 

agencies and 3 of the 10 PSCs suggested that CMS include Federal 

officials from the Medicaid Integrity Group. According to the 

respondents, this would enable CMS Medicare program integrity staff and 

PSCs to better understand the Medicaid side of the program, such as how 

to better interpret and analyze Medicaid claims data. Four of the 

10 participating State Medicaid program integrity agencies said that PSCs 

do not understand Medicaid and that as a result they primarily analyze 

Medicare claims data.

Access to information in the Fraud Investigation Database is 

limited

For the purpose of the Medi-Medi program, PSCs are required to enter 

information into the Fraud Investigation Database relating to Medicare, 

Medicaid, and Medi-Medi fraud, waste, and abuse investigations.46 PSCs 

are required to do this in part to make such information available to State 

Medicaid program integrity agencies.47

Five of the ten participating State Medicaid program integrity agencies 

report they do not use the Fraud Investigation Database because CMS did 

not provide access to it. An additional four State Medicaid program 

integrity agencies reported they have difficulty accessing the database

because it is not user-friendly. The remaining State Medicaid program 

integrity agency reported: “[O]ver the years we have periodically tried to 

use the [Fraud Investigation Database], but found it to be cumbersome and 

of limited use.”

 The database is intended to provide 

State Medicaid program integrity agencies with information about Medicaid, 

Medicare and Medi-Medi investigations. 

46 CMS, Medicare-Medicaid Data Match Program (Medi-Medi) Policies and Procedures Manual, p. 65. 

47 CMS, Medicare Program Integrity Manual, Pub. 100-08, ch. 4, § 4.11. Accessed at 

https://www.cms.gov/manuals/downloads/pim83c04.pdf on May 27, 2010. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 20

PSCs do not receive rating scores directly assessing their 

performance of required tasks listed in the Medi-Medi Statement 

of Work

The Evaluation Guidelines include guidance for assessing performance on 

the six tasks. However, CMS does not identify each of the required SOW 

tasks in either the Findings Tables or Performance Reports, nor does it 

document its ratings of PSCs on their performance of each SOW task. 

According to CMS Medicare program integrity staff, because the SOW is 

added onto a broader program integrity task order, the majority of the 

content in the Findings Tables and Performance Reports applies to the 

performance under that broader task order. In addition, content in the 

Findings Tables and Performance Reports assessing PSCs’ performance 

under the broader program integrity task order is commingled with content 

about their performance under of SOW tasks. As a result, PSCs do not 

receive rating scores specific to their performance of each SOW task. 

According to CMS Medicare program integrity staff, CMS has never 

made a decision not to renew a PSC’s broader program integrity task order 

based solely on a PSC’s performance under the SOW. CMS uses the 

Findings Tables to document assessment findings and ratings and to 

provide verbal feedback to PSCs regarding their performance under the 

SOWs. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 21

RECOMMENDATION

The SSA requires that the Medi-Medi program increase the effectiveness and 

efficiency of the Medicare and Medicaid programs through cost avoidance 

(i.e., prepayment denials); savings; and recoupment of fraudulent, wasteful, 

or abusive expenditures. However, during 2007 and 2008, the Medi-Medi 

program produced limited results and few fraud referrals, and the majority of 

those results were attributed to Medi-Medi activities in three States. 

Compared with Medicare, State Medicaid programs received less benefit 

from the Medi-Medi program. Limitations in the administration of the 

program may have diminished its potential. 

We recommend that CMS: 

Reevaluate the goals, structure, and operations of the 

Medi-Medi program to determine what aspect of the program, 

if any, should be part of CMS’s overall program integrity 

strategy

As part of this reevaluation, CMS could:

• Determine how, if at all, the Medi-Medi program could be a more 

effective program integrity resource. 

• Determine whether appropriations for the Medi-Medi program should 

continue to be used to develop and implement the One PI System.

• Determine whether including officials from the Medicaid Program Integrity 

Group in administering the Medi-Medi program would improve its results. 

• Ensure that each participating State Medicaid program integrity agency has 

appropriate access to useful information in the Fraud Investigation Database. 

As needed, CMS also could provide additional user guidance to State 

Medicaid Program Integrity agencies for using the database. 

• Establish appropriate standards in the SOW to measure PSCs’ 

performance in relation to the number of fraud referrals and the amount 

of Medicare and Medicaid fraud, waste, and abuse expenditures avoided 

and recouped. 

• Directly assess PSCs’ performance of each task listed in the SOW, and 

determine whether performing those tasks produces cost-effective results. 

In addition, CMS could assess the benefit of providing PSCs with 

comprehensive written analyses of their performance of each SOW task

(and any corrective action plans). 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 22

AGENCY COMMENTS AND OFFICE OF INSPECTOR GENERAL 

RESPONSE 

CMS concurred with our recommendation. CMS commented that since 

the period of our review, it has made significant strides in enhancing the 

effectiveness of the Medi-Medi program and its overall program integrity 

efforts. CMS further stated that the program has been a useful tool in 

helping fight fraud, waste, and abuse and that the program will become 

more effective over time as more States participate. However, CMS has 

not provided any data to illustrate enhanced effectiveness of the program

since the period of our review. CMS has not provided any data regarding 

the number of referrals, accepted referrals, and the actual—not potential—

Medicare and Medicaid expenditures avoided and recouped. These data 

would enable Congress to make an informed decision whether to continue 

appropriating funding for the program. These data would also enable 

stakeholders (i.e., CMS, States, and Medi-Medi partners) to make an 

informed decision on whether to use their resources to participate. 

For the full text of CMS’s comments, see Appendix D. 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 23

APPENDIX A

Sources for Centers for Medicare & Medicaid Services Requirements for 

the Medicare-Medicaid Data Match Program

Sources for Requirements Description

Medicare Program Integrity Manual

Identifies Program Safeguard Contractors’ (PSC) program integrity 

requirements, such as the requirement to enter data into the Fraud 

Investigation Database.

The Medicare-Medicaid Data Match Program 

(Medi-Medi) Statement of Work (SOW)

Identifies the tasks that PSCs were required to perform for the 

period of 2007 and 2008.

The Medicare-Medicaid Data Match Program 

(Medi-Medi) Policies and Procedures Manual

Provides Medi-Medi program guidance to PSCs, State Medicaid 

program integrity agencies, and Federal and State law 

enforcement agencies. 

PSC Performance Evaluation Guidelines Sets forth the Medi-Medi SOW performance requirements and 

provides guidance for assessing PSCs’ performance. 

PSC BI [Benefit Integrity] Evaluation Control 

Objectives and Findings Tables

Identifies the key elements and review methodology for assessing 

PSC performance, as well as the corresponding written assessment 

and rating.
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 24

APPENDIX B

Required Tasks Listed In the Statement of Work and Documentation 

Analyzed To Determine Whether the Task Was Performed

A shaded background indicates that Program Safeguard Contractors (PSC) 

were not required to perform the task during the period of our review. 

Only one PSC was required to perform transition activities (Task #10). 

continued on next page

Medicare-Medicaid Data Match Program Tasks and Documentation and Data Analyzed

Statement of Work (SOW) Tasks Documentation and Data Analyzed

1. Incorporate a project plan. This Medicare-Medicaid Data Match Program (Medi-Medi program) 

SOW task was required to be performed prior to 2007. Therefore, we did 

not include this task in our analysis. 

2. Incorporate an information technology plan. This Medi-Medi SOW task was required to be performed prior to 2007. 

Therefore, we did not include this task in our analysis. 

3. Submit to Centers for Medicare & 

Medicaid Services (CMS) a monthly status 

report.

Monthly status reports

Questionnaire responses from CMS Medicare program integrity staff 

Structured interviews with CMS Medicare program integrity staff PSCs 

PSC BI [Benefit Integrity] Evaluation Control Objectives and Findings 

Tables (Findings Tables)

Standard Contractor Performance Report (Performance Report)
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 25

APPENDIX B (continued)

Medi-Medi Program Tasks and Documentation and Data Analyzed (continued)

SOW Tasks Documentation and Data Analyzed

4. Develop a joint operating agreement. Joint operating agreement

Questionnaire responses from CMS Medicare program integrity staff

Structured interviews with CMS Medicare program integrity staff and 

PSCs 

Findings Tables 

Performance Reports 

5. Provide remote user access and support. Structured interviews with CMS Medicare program integrity staff, PSCs, 

and State Medicaid program integrity agencies 

Findings Tables 

Performance Reports 

6. Perform data analysis. Monthly status reports 

Structured interviews (with CMS Medicare program integrity staff, PSCs, 

and State Medicaid program integrity agencies) 

Findings Tables 

Performance Reports 

continued on next page
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 26

APPENDIX B (continued) 

Medi-Medi Program Tasks and Documentation and Data Analyzed (continued)

SOW tasks Documentation and Data Analyzed

7. Develop and refer potential fraud cases. Monthly status reports 

Structured interviews with CMS Medicare program integrity staff, PSCs,

State Medicaid program integrity agencies, and Medi-Medi Partners

Questionnaire responses from CMS Medicare program integrity staff

Findings Tables

Performance Reports 

8. Facilitate a steering committee. Quarterly steering committee minutes 

Structured interviews with CMS Medicare program integrity staff, PSCs, 

State program integrity agencies, and Medi-Medi partners 

Findings Tables 

Performance Reports 

9. Prepare “lessons learned” reports. This Medi-Medi SOW task was required to be performed prior to 2007. 

Therefore, we did not include this task in our analysis. 

10. Perform transition activities. Structured interviews with CMS Medicare program integrity staff and 

PSCs 

Questionnaire responses from CMS Medicare program integrity staff

Findings Tables

Performance Reports 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 27

APPENDIX C

Analysis Results of Program Safeguard Contractors’ Performance of 

Selected Tasks in the Statement of Work for the Medicare-Medicaid Data 

Match Program

Task #3: Submit to the Centers for Medicare & Medicaid Services [CMS] 

a monthly status report. Each program safeguard contractor (PSC) 

submitted a monthly status report to CMS. Although the format of the 

reports varied among PSCs, the reports contained the content required by the 

Statement of Work (SOW), such as information about provider referrals, the 

nature of investigations, data analysis projects, and Medicare and/or 

Medicaid expenditures avoided or recouped. 

Task #4: Develop a joint operating agreement. Each PSC developed a joint 

operating agreement with its State Medicaid program integrity agency and 

other applicable agencies to establish guidelines, duties, and shared 

expectations for the Medi-Medi program. In addition, as suggested by the 

Medicare-Medicaid Data Match Program (Medi-Medi) Policies and 

Procedures Manual, those agreements were revised as necessary in 2007 and 

2008. 

Task #5: Provide remote user support and access. For PSCs, State 

Medicaid program integrity agencies, and Medi-Medi partners, each PSC 

provided remote user support and access to matched Medicare and Medicaid 

claims data. However, in 2007, for Medi-Medi programs in two States, 

those two PSCs were not able to provide access to matched Medicare and 

Medicaid data within 4 months of executing a computer match agreement. 

According to CMS Medicare program integrity staff, the delay was due to 

connectivity issues caused by firewalls to the server. PSCs provided access 

to the data through a variety of means, including the use of transmission 

level-1 lines (commonly referred to as T-1 lines), file transfer via the 

Internet, data tapes, and/or data disks. According to PSCs and State 

Medicaid program integrity agencies, user support and access improved in 

those States where PSCs provided staff to work directly onsite with the State 

Medicaid program integrity agency staff. 

Task #6: Perform data analysis. Based on our review of the monthly status 

reports, PSC BI [Benefit Integrity] Evaluation Control Objectives and 

Findings Tables, Standard Contractor Performance Report, and structured 

interviews, each PSC performed data analysis. Each PSC performed at least 

36 total unique data analysis projects during 2007 and 2008. The number of 

unique projects per PSC ranged from 36 to 677. In 2007, each PSC 

performed at least 16 unique data analysis projects, and in 2008, each PSC 

performed at least 10 unique projects.
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 28

APPENDIX C (continued) 

Task #7: Develop and refer potential fraud cases. Based on our review of 

the monthly status reports, questionnaire responses from CMS, and 

structured interviews, 7 of the 10 PSCs developed and referred potential 

fraud cases in both 2007 and 2008. However, among PSCs that did so 

during that time, the number of referrals ranged from 2 PSCs that referred 

4 potential fraud cases each to a PSC that referred 27 fraud cases. 

Task #8: Facilitate a steering committee. Each of the PSCs facilitated a 

steering committee with its State Medicaid program integrity agency and 

Medi-Medi partners and prepared minutes from committee meetings. 

However, the Medi-Medi SOW states that the steering committee “should 

meet not less frequently than quarterly.” Although PSCs may have 

scheduled quarterly meetings, according to the dates entered on the 

committee minutes, five PSCs may have met less frequently in 2007 and one 

PSC may have met less frequently in 2008. 

Task #10: Perform transition activities. Based on responses provided by 

CMS Medicare program integrity staff to our questionnaire, one PSC was 

required to perform transition activities and that PSC performed this task 

by submitting the required information to the Zone Program Integrity 

Contractor that was awarded the SOW.
APPENDIX D 

Agency Comments 

"...­.... 

( ~ DEPARTMENT OF HEALTH &. HUMAN SERVICES CentCfS lor MedlC8JEI & Medicaid Services 

,,~~ Adminis#7"tor 

Washington. OC 20201 

DATE: JAN 272012

TO: 	 Daniel R. Levinson 

l)lspector General 

FROM: "'~T/l rll1er 

Acting Ad ator 

Office ofInspector General (010) Draft Report: "The Medicare-Medicaid (MediMedi) Data Match Program" (OEI-09-08-00370) 

SUBJECT: 

The Centers for Medicare & Medicaid Services (CMS) appreciates the opportunity to review and 

comment on the OIG draft report entitled, "The Medicare-Medicaid (Medi-Medi) Data Match 

Program." The purpose ofthis report was to determine whether Program Safeguard. Contractors 

(PSC) performed the required tasks for the Medicare-Medicaid Data Match Program (Medi-Medi 

program) and the extent to which the Medi-Medi program identified fraud, waste, and abuse. 

Since the period ofreview ofthis report (2007 -2008), CMS has made significWl\ strides in 

enhancing the effectiveness of the Medi-Medi program and the Agency's overall program 

integrity efforts_ CMS has established the Center for Program Integrity (CPI) that leads a 

collaborative effort to fight waste, fraud, and abuse in Medicare and Medicaid. Specifically, 

since the formation ofCPI, both the CMS Medicare and Medicaid Integrity Program groups have 

been working collabord!ive[y on the ongoing operation ofthe Medi-Medi program. 

The Medi-Medi program has been a useful tool in helping to fight fraud, waste, and abuse. The 

progranl continues to refer potential fraud referrals to law enforcement, and CMS is examining 

opportunities to share best practices among States that have had successful referrals. Six States 

have been added to the Medi-Medi program for a total of 1 5 panicipating States, and there has 

been strong interest from additional States in participating. CMS continues to work with States 

to identify and collaborate on improvements to the program. 

The CMS has already implemented many ofthe suggestions made by OIG including improving 

access to the Fraud Investigations Database for States and establishing appropriate perfonnance 

standards for PSCs alld Zone P, ogram Integrity Contractors (ZPIC). In addition, Medicaid 

program integrity staffregu[arly collaborates in administrating the Medi-Mcdi program. 

As suggested by OIG, CMS is currently assessing the Medi-Medi program regarding program 

integrity efforts and provides further detail on OIG's suggestions below. 

OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 29 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 30

APPENDIX D (continued) 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 31

APPENDIX D (continued) 
OEI-09-08-00370 The Medicare-Medicaid (Medi-Medi) Data Match Program 32

ACKNOWLEDGMENTS

This report was prepared under the direction of Timothy S. Brady, Regional 

Inspector General for Evaluation and Inspections in the San Francisco 

regional office. 

Michael Henry served as the team leader for this study. Other principal 

Office of Evaluation and Inspections staff from the San Francisco regional 

office who contributed to the report include Loul Alvarez, 

Christina Lester, and Marcia Wong; central office staff who contributed 

includes Scott Manley and Louise Schoggen. We also would like to 

acknowledge the contributions by Ann Maxwell of the Chicago regional 

office and Robert A. Vito of the Philadelphia regional office. 
Office of Inspector General

http://oig.hhs.gov

The mission of the Office of Inspector General (OIG), as mandated by Public Law 95-452, as amended, is 

to protect the integrity of the Department of Health and Human Services (HHS) programs, as well as the 

health and welfare of beneficiaries served by those programs. This statutory mission is carried out through 

a nationwide network of audits, investigations, and inspections conducted by the following operating 

components:

Office of Audit Services

The Office of Audit Services (OAS) provides auditing services for HHS, either by conducting audits with 

its own audit resources or by overseeing audit work done by others. Audits examine the performance of 

HHS programs and/or its grantees and contractors in carrying out their respective responsibilities and are 

intended to provide independent assessments of HHS programs and operations. These assessments help 

reduce waste, abuse, and mismanagement and promote economy and efficiency throughout HHS.

Office of Evaluation and Inspections

The Office of Evaluation and Inspections (OEI) conducts national evaluations to provide HHS, Congress, 

and the public with timely, useful, and reliable information on significant issues. These evaluations focus 

on preventing fraud, waste, or abuse and promoting economy, efficiency, and effectiveness of 

departmental programs. To promote impact, OEI reports also present practical recommendations for 

improving program operations. 

Office of Investigations

The Office of Investigations (OI) conducts criminal, civil, and administrative investigations of fraud and 

misconduct related to HHS programs, operations, and beneficiaries. With investigators working in all 

50 States and the District of Columbia, OI utilizes its resources by actively coordinating with the 

Department of Justice and other Federal, State, and local law enforcement authorities. The investigative 

efforts of OI often lead to criminal convictions, administrative sanctions, and/or civil monetary penalties.

Office of Counsel to the Inspector General

The Office of Counsel to the Inspector General (OCIG) provides general legal services to OIG, rendering 

advice and opinions on HHS programs and operations and providing all legal support for OIG’s internal 

operations. OCIG represents OIG in all civil and administrative fraud and abuse cases involving HHS 

programs, including False Claims Act, program exclusion, and civil monetary penalty cases. In 

connection with these cases, OCIG also negotiates and monitors corporate integrity agreements. OCIG 

renders advisory opinions, issues compliance program guidance, publishes fraud alerts, and provides other 

guidance to the health care industry concerning the anti-kickback statute and other OIG enforcement 

authorities.