How to Obtain a Medicare Risk Contract
There are approximately 3.6 million beneficiaries of Medicare in the United States. This population is growing steadily and many HMOs are seeking to serve this demographic. To accomplish this, HMOs can enter into a Medicare risk contract with the Office of Managed Care. This allows the HMOs to serve these patients and qualify for Medicare coverage.
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Instructions
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Request an application kit. HMOs can request an application kit from the Health Care Financing Administration (HCFA) Office of Managed Care. This is a federal agency that oversees Medicare risk contracts. Your application kit will include regulations, policies and forms to guide you through the process of obtaining a Medicare risk contract.
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Be prepared to pay a user fee. When submitting your application be prepared to pay a user fee of $18,400. This covers your basic Medicare risk contract, but if you choose to expand your existing area there is an additional fee of $3,900. If you have questions about service areas or fees, the Office of Managed Care and HCFA can be contacted to provide additional clarification.
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Make sure your HMO is experienced. A prerequisite for obtaining a Medicare risk contract is to be experienced and have a minimum of 5,000 prepaid commericial members. In additional, at least half of prepaid members must be commerical members and the companies must have an open enrollment annually.
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Understand processing turnaround time. The Office of Managed Care takes approximatley six to nine months to approve a Medicare risk contract. If you haven't heard back after this amount of time has passed, contact the office for follow up.
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Be prepeared for an onsite visit. A requirement for approving your Medicare risk contract is a two or three-day onsite visit. The HCFA reviewers will contact you to schedule a time for the visit.
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Tips & Warnings
Remember to renew your contract. Medicare Risk Contracts typically need to be reviewed annually. The Office of Managed Care can provide renewal forms to complete.
Be carefull about requirements. When it's time to renew, if you don't maintain all of the requiements for obtaining a medicare risk contract, you may get canceled. And you won't be allowed to reapply for 5 years. So make sure to mataining all prerequests.
