§ 155.1635 Corrective action plan (CAP).
(a) CAP. HHS may require the State Exchange to develop and submit a proposed CAP to correct errors resulting in improper payments.
(b) Development of proposed CAP. A State Exchange's proposed CAP must address errors that are included in the State Exchange improper payment report described in § 155.1625(c)(2) and must be developed in accordance with HHS requirements.
(1) In developing a proposed CAP, the State Exchange must conduct an error analysis such as reviewing causes, characteristics, and frequency of errors that are associated with improper payments. The State Exchange must review the findings of the analysis to determine the causes of the errors included in the State Exchange improper payment rate, if any, and to identify the root causes of the resulting improper payments.
(i) If a State Exchange has a pending Difference Resolution request or administrative appeal and HHS requests a CAP, HHS may provide a new timeline for CAP submission after the Difference Resolution or Administrative Appeal Decision and calculation of the final improper payment rate.
(ii) [Reserved]
(2) The State Exchange must determine the corrective actions to be implemented to correct causes of the errors included in the State Exchange improper payment rate and to prevent them from occurring again.
(3) The proposed CAP must include measurable milestones, accountability mechanisms, regular monitoring and validation of progress, documentation of implemented corrective actions, and regular status updates. The CAP must include all the following for each identified error:
(i) The specific corrective action.
(ii) Status of the corrective action.
(iii) Scheduled or actual implementation date of the corrective action.
(iv) Key personnel responsible for implementing each corrective action.
(v) A plan for monitoring the effectiveness of the corrective action.
(c) Implementation and evaluation of a CAP. A State Exchange must develop an implementation schedule for its CAP, implement the plan in accordance with that schedule, and regularly evaluate whether the initiatives are effective at reducing or eliminating error causes. The State Exchange must provide updates on CAP implementation progress in a manner and frequency specified by HHS, but at least annually.
(d) Failures in the CAP process. If a State Exchange does not submit a CAP when one has been required, submits an incomplete CAP that does not address all the required parts of a CAP as specified in paragraph (b)(3) of this section, fails to follow the implementation schedule referenced in paragraph (c), or submits a CAP that is otherwise unacceptable following technical assistance from HHS, HHS may take actions consistent with § 155.1650.