Healthcare Revenue Cycle Management, ICD-10, Claims Reimbursement, Medicare, Medicaid

Policy & Regulation News

California State Agency Claims $375,000 in Non-Compliant Medicaid Fees

By Stephanie Reardon

Out of 100 beneficiary-services six had not complied with federal regulations leading to over payment in Medicaid fees.

- The Department of Health and Human Service (HHS) Office of Inspector General (OIG) released the results of its audit on Medicaid fee-for-service claims paid to medical transportation providers in California for nonemergency medical transport (NEMT) services from July 1, 2010, through June 30, 2011.

The audit was completed to determine if Federal Medicaid reimbursement for these services were claimed by the California Department of Health Care Services (State agency) in compliance with Federal and State requirements. During this audit, it was discovered that California claimed at least $375,000 in Federal Medicaid reimbursement for NEMT services that did not comply with Federal and State requirements during a one-year period.

The Medicaid program pays for NEMT services that a State determines to be necessary for beneficiaries to obtain medical care. OIG identified this area as vulnerable to fraud, waste, and abuse so it began reviewing this area in 2006.

The California State agency pays transportation providers for NEMT services if transportation is required for beneficiaries to obtain needed medical care, according to California regulations. To be reimbursed, prior authorization from the State agency through approval of a treatment authorization request (TAR) submitted by the transportation provider is required. Providers must maintain retrievable records which disclose the type and extent of the services provided in order for a NEMT service to be eligible for payment.

However, it was discovered that out of 100 beneficiary-services six had not complied with federal regulations. Two that did not comply were submitted without the required documentation, two were not the lowest cost of adequate transportation available, in one beneficiary-service, the State agency paid for services provided on a date that the beneficiary did not obtain needed medical care and one was improperly billed.

Additionally, it was discovered that 12 transportation providers did not maintain documentation for drivers and vehicles associated with NEMT services in compliance with State requirements.

“These deficiencies occurred because the transportation providers did not always follow Federal and State requirements for billing NEMT services,” the report reads. “Using our sample results, we estimated that the State agency claimed Federal reimbursement of at least $375,665 for NEMT services that did not comply with Federal and State requirements.”

The OIG recommends that the California State Agency refund $375,665 to the Federal Government, ensure transportation providers are informed on the correct procedures to bill for NEMT services according to Federal and State requirements, and teach transportation providers to maintain documentation for drivers and vehicles associated with NEMT services.

In written comments, the California State Agency agreed with the OIG’s second and third recommendations. However, it partially disagreed with the OIG’s first recommendation. For the service provided on a date that the beneficiary did not obtain needed medical care, the State agency indicated that after further review a medical reason was discovered.

After reviewing the State Agency’s response, OIG withdrew its finding that the State agency paid for an NEMT service provided on a date that was not authorized on the approved TAR, and appropriately recalculated the amount to be refunded.

 

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