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

Policy & Regulation News

GAO: Millions Spent Yearly on Ineligible Medicaid Reimbursements

Each year, $3 million in Medicaid reimbursement goes to ineligible providers partially because state officials use poor screening methods.

By Catherine Sampson

- Ineligible managed care providers currently receive $3 million in Medicaid reimbursements annually, the Government Accountability Office (GAO) said in a report, due to the lack of effective screening processes.

Many ineligible healthcare providers are still able to receive Medicaid reimbursement due to poor screening processes.

“The integrity of the Medicaid program depends, in large part, on ensuring that only eligible providers participate in the program. Consequently, screening providers is important in helping prevent improper payments, including fraud and abuse,” GAO said.

States officials and health plan officials are supposed to use a screening process so they can prevent ineligible providers from bilking the Medicaid system. However, the current process is not effective because many providers are still getting paid by one state Medicaid health insurance program even after they are kicked out of another state’s Medicaid system or the federal Medicare program. Ineligible providers are supposed to be terminated by a state from participating in Medicaid under any requirement.

After examining two states and 16 selected plans, GAO discovered that both the state officials and health plan officials used information that was “fragmented” across 22 databases managed by 15 different federal agencies to screen providers.

Many states are currently using “inconsistent practices” to make data on ineligible providers publically available. States are supposed to determine if a provider is ineligible to practice medicine anywhere in the US. States currently use various federal databases to screen providers in order to help prevent ineligible providers from enrolling.

“States either screen providers, or they delegate screening to plans, or use a combination of both approaches,” the report said.  This process makes identifying ineligible providers across many states a difficult task.

“State officials and plan representatives also said that accessing and using fragmented information from multiple and disparate federal databases challenged their screening efforts,” GAO said.

They specifically had a difficult time accessing certain databases, such as the Social Security Administration’s Death Master File. It was also difficult for state officials and plan representatives to conduct and confirm identified provider matches across multiple databases.

According to GAO, CMS has not collaborated with other agencies to help solve some of these problems, which contributed to $29 billion in improper payments across the federal Medicaid system.

Additionally, some of the databases contained resources that could help prevent state officials and plan representatives from accidentally enrolling ineligible providers. However, CMS may have not identified all reliable sources of information concerning ineligible providers that could help states and plans achieve Medicaid objectives, GAO said.

In 2015, Reuters conducted an analysis of state and federal data and found that “more than one in five of the thousands of doctors and other healthcare providers in the US prohibited from billing Medicare are still able to bill state Medicaid programs.”

By looking at data from 2014, Reuters was able to find 1,800 banned providers that were still able to bill.

Reuters also saw that CMS’ data-sharing system is extremely flawed. “Banned providers can slip through the cracks because of missing or erroneous data. Others remain unrecorded because of state laws that don’t square with federal requirements or because of different interpretations of language in the Affordable Care Act,” the article said.

In 2015, the Medicaid program financed healthcare coverage for about 69 million beneficiaries with estimated expenditures of $529 billion. CMS is responsible for broad oversight of the Medicaid program. States, on the other hand, are responsible for the daily administration of their individual Medicaid programs, including program integrity activities, GAO said.

When it comes to screening, both CMS and states clearly has a difficult challenge to address. In order to reduce the number of ineligible providers from having the ability to bill the system, CMS arguable should provide states with a data sharing system that is effective and accurate.

“Federal internal control standards state that agencies should use quality data that are complete, current, accurate, and accessible—and have a logical connection to the program—to achieve agency goals to reduce fraud,” GAO said.

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