CMS Addresses Provider, Beneficiary Medicaid Payment Fraud
By - Is Medicaid in danger as a high-risk program? Thousands of Medicaid beneficiaries and hundreds of healthcare providers are connected to allegedly erroneous or fraudulent payments, according to a recent US Government Accountability Office (GAO) report, GAO-15-313. Such news follows a February 2015 GAO report stating Medicaid is officially at high risk due to the possibility of improper payments to Medicare providers.
GAO has defined Medicaid as a high-risk program for over the past decade. Improper payments within the Medicaid realm are an ongoing, billion dollar tri-fold concern within the healthcare industry, the federal government, and the states.
GAO reports a new presence of potentially fraudulent activity, such as alleged “questionable or nonexistent” Social Security numbers. “Over 12,500 of the beneficiaries used an SSN that was never issued,” says GAO, in reference to a reported minimum of $76 million in Medicaid benefits. GAO expresses additional concern that more action needs to be implemented to prevent individuals incarcerated within a jail cell from allegedly stealing deceased beneficiaries’ healthcare information.
Last year, the Centers for Medicare & Medicaid Services (CMS), within the Department of Health and Human Services (HHS), reported over $17 billion in possibly improper Medicaid payments. The collective sum of Medicaid federal outlays within 2014 totaled $310 billion, says GAO. CMS maintains primary responsibility for general program oversight, including the disbursement of federal matching funds, maintains GAO.
In 2011, reliable data was collected regarding over 9 million beneficiaries amongst the four states with the highest Medicaid enrollment – Arizona, Florida, Michigan, and New Jersey. Thirteen percent of all Medicaid payments from 2011 are attributed to these four states.
According to specifics of GAO’s collected data, 8,600 beneficiaries had simultaneous payments made on their behalf by at least 2 of the 4 aforementioned states. Such payments total at least $18 million, says GAO. Additionally, 200 deceased beneficiaries received approximately $9.6 million in Medicaid benefits. GAO also states approximately 50 healthcare providers faced federal healthcare program exclusion, including Medicaid exclusion. The causes of such included patient abuse, neglect, fraud, theft, bribery, and tax evasion.
Since 2011, CMS “has taken regulatory steps to make the Medicaid enrollment process more rigorous and data-driven,” GAO maintains. “However, gaps in beneficiary-eligibility verification guidance and data sharing continue to exist.”
GAO says the first gap requiring action from CMS is that states cannot always identify those beneficiaries who have moved out of state before passing away. Resultantly, states may struggle to thwart potentially fraudulent benefits to those individuals utilizing these identities. About 3,600 individuals received Medicaid benefits while actively incarcerated within a state federal prison facility. Says GAO, “Federal law prohibits states from obtaining federal Medicaid matching funds for health-care services provided to inmates except when inmates are patients in medical institutions.”
Says GAO, CMS regulations do not mandate a periodic review of Medicaid beneficiary files from states for deceased individuals except within an annual basis. It is also unstipulated whether or not states should harmoniously incorporate the Social Security Administration Death Master File along with state-reported death data.
GAO asserts the second gap requiring immediate addressing is the four states’ combined failure to manually implement the Provider Enrollment, Chain and Ownership System (PECOS) to screen Medicaid providers. CMS requires states to screen healthcare providers and suppliers to confirm they have active licenses in relation to where Medicaid services are provided. Comprehensive PECOS information, such as ownership information, is not yet available, GAO asserts. States confirm this information is imperative to successfully process Medicaid provider applications.
“GAO recommends that CMS issue guidance for screening deceased beneficiaries and supply more-complete data for screening Medicaid providers,” states GAO. “To further improve efforts to limit improper payments, including fraud, in the Medicaid program, the Acting Administrator of CMS should provide guidance to states on the availability of automated information through Medicare's enrollment database,” says GAO, “and full access to all pertinent PECOS information, such as ownership information, to help screen Medicaid providers more efficiently and effectively.”
CMS and HHS confirmed agreement with the recommendations and affirmed the administration of continuous guidance to address GAO’s suggestions.
