The US Department of Health and Human Services, Centers for Medicare and Medicaid Services has a continuing requirement to provide specified fee-for-service health insurance benefit administration services, including Medicare claims processing and payment services, for most all institutional health care as well as for providers in Jurisdiction H.

The Medicare program is an integral component of the federal government’s commitment to the health and welfare of the American people, which includes the Social Security system, the Medicaid program (which is primarily administered by the states), and other programs. The Medicare program provides affordable health insurance to (1) eligible individuals aged 65 and over; (2) certain individuals eligible for disability benefits under the Social Security system; and (3) individuals with acute kidney failure (end-stage renal disease, or ESRD).

Nearly all Medicare beneficiaries may access their insurance benefits through one of two health care delivery systems:

First, in all areas of the country, a beneficiary may enroll in the traditional Medicare program (the Medicare FFS program) under which benefits are largely provided in keeping with an indemnity insurance model. That is, the beneficiary chooses his/her health care providers, the providers bill the appropriate Medicare claims administrator for their services, and the claims administrator pays the provider based on the eligibility, coverage, and payment rules of the Medicare Hospital Insurance (HI) and Supplementary Medical Insurance (SMI) programs. The federal government bears all financial (underwriting) risk for the cost of program benefits and develops detailed administrative requirements and processes to support the claim administration process. This national entitlement program has a strong imperative to provide a common level of benefits and service in all areas of the country, while maintaining adequate flexibility to account for local and regional medical practices.

Second, in many areas of the country, beneficiaries have the option to enroll in one or more privately sponsored Medicare plans under the Medicare Advantage (MA, formerly Medicare+ Choice) program. These private Medicare plans may organize themselves in keeping with one of several health care delivery and payment models (health maintenance organizations, preferred provider organizations, etc.). These private Medicare plans are required to cover the same basic benefits that the traditional Medicare program offers, but they are given fairly broad responsibility and latitude to set up their internal requirements and processes as they see fit. The Medicare Prescription Drug, Improvement and Modernization Act of 2003 (MMA) included significant incentives to increase the participation in Medicare Advantage. However, for the next decade at least, the majority of all Medicare beneficiaries will likely remain enrolled in the traditional FFS Medicare program. FFS coverage in the Medicare program consists of two distinct parts: (1) HI, and (2) SMI, which provide coverage for the professional medical services of physicians and certain other licensed practitioners, as well as coverage for a variety of other services and items (ambulance, durable medical equipment, etc.). In common usage, the HI program is known as “Medicare Part A,” although both the Part A and B trust funds are used to reimburse institutional claims. The SMI program is known as “Medicare Part B;” only the Medicare Part B trust fund is used to reimburse Part B claims.

• This acquisition supports the mission of the Centers for Medicare & Medicaid Services to ensure health care security for beneficiaries. The CMS’ strategic goals and objectives, developed in conjunction with the Department of Health and Human Services’ strategic plan, emphasize the themes of accountability, stewardship, and a renewed focus on the customer. For the CMS, this has resulted in a commitment to beneficiaries as the ultimate focus of all CMS activities, expenditures, and policies. To ensure that the CMS remains a responsive, dynamic, and relevant government agency that serves its citizens, the CMS is committed to monitoring and evaluating the effectiveness of its programs. The CMS will communicate, collaborate, and cooperate with key customers, both public and private, to help achieve the desired outcomes