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A Primer on SMRC Audits

The Centers for Medicare & Medicaid Services (CMS) contracts with a Supplemental Medical Review Contractor (SMRC) who provides support for a variety of tasks aimed at lowering improper payment rates and increasing efficiencies of the medical review functions of the Medicare and Medicaid programs. Noridian Healthcare Solutions was selected as the SMRC in 2018. The SMRC conducts nationwide medical reviews of Medicare Parts A and B, DMEPOS, and Medicaid claims to determine whether claims follow coverage, coding, payment, and billing requirements. The focus of the medical reviews may include areas identified by CMS data analysis, the Comprehensive Error Rate Testing (CERT) program, professional organizations, and federal oversight agencies. At the request of CMS, the SMRC may also carry out other special projects to protect the Medicare Trust Fund.

SMRC audits are referred to as projects and there are three categories of SMRC project reviews:

  • Healthcare Fraud Prevention Partnership (HFPP) Review: Based on fraud, waste, and abuse trends identified by the HFPP.
  • Program Integrity (PI) Review: Focused on alleged possible falsification or other evidence of alterations of medical record documentation including, but not limited to, obliterated sections; missing pages, inserted pages, or white out; excessive late entries; evidence that services billed for were actually provided and/or provided as billed; or patterns and trends that may suggest potential fraud, waste, and abuse.
  • Provider Compliance Group (PCG) Review: Based on an evaluation of a beneficiary’s information and supporting medical records to ensure that payment is made only for services that meet all Medicare coverage, coding, and medical necessity requirements.

CMS determines review topics and timeframes, then assigns the focus project to the SMRC via a formal notification. The SMRC sends affected providers an Additional Documentation Request (ADR) letter in a distinctive green envelope with the Noridian SMRC logo. Upon receipt of returned medical records and/or supporting documents, the SMRC conducts the review based on the analysis of national claims data and in accordance with statutory and regulatory coverage as well as coding, payment, and billing requirements. Once the review is complete, the provider will receive a Review Results Letter. A provider may sometimes be given 14 days to request a voluntary Discussion and Education (D&E) session with the SMRC. The D&E session allows for discussion of the medical review findings, education to avoid future denials, and an opportunity to submit missing documentation. Providers should remember that they may have the right to appeal the SMRC’s Review Results within certain timeframes.

According to Noridian, the current SMRC, the following are ongoing projects under review as of June 2021:

  • Botulinum Toxins
  • DME Supplies in Non-Covered SNF
  • DRG COVID 20% Add-On Payment
  • DRG Thyroid, Parathyroid, and Thyroglossal Procedures
  • Electrodiagnostic Testing Axial Muscles and Spinal Levels
  • Facility Chronic Care Management (CCM)
  • Hospice Portfolio
  • Inpatient Rehab Facility (IRF)
  • Inpatient Rehabilitation Facility Stays (IRF) Longer Length of Stay (LOS)
  • Intravenous Immune Globulin (IVIG)
  • Skilled Nursing Facility (SNF)
  • Specimen Validity Part 2
  • Spinal Cord Stimulator
  • TENS
  • Therapeutic Shoes for Diabetics
  • Therapy Reviews
  • Transforaminal Epidural Injections

For over 35 years, Wachler & Associates has represented healthcare providers and suppliers nationwide in a variety of health law matters, and our attorneys can assist providers and suppliers in understanding SMRC audits and other types of payor reviews. If you or your healthcare entity has any questions pertaining to healthcare compliance, please contact an experienced healthcare attorney  at 248-544-0888 or

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