Purpose

To determine the extent of implementation of the five recommendations made in our audit report, Improper Payments Related to the Medicare Buy-In Program (2010-S-76).

Background

The federal government established the Medicare buy-in program to assist certain low-income people pay out-of-pocket Medicare expenses. Under the buy-in program, Medicaid pays the Medicare premiums and sometimes the deductibles and coinsurance of people who meet various eligibility requirements. Determinations of Medicare buy-in program eligibility are made by the New York City Human Resources Administration and the 57 other county departments of social services outside of New York City (local districts). Annual Medicaid payments for the Medicare buy-in program total approximately $1.3 billion.

Our initial audit report, which was issued on October 26, 2012, determined that, from March 2006 through February 2011, Medicaid made nearly 260,000 improper payments (totaling about $26.8 million) for people enrolled in the Medicare buy-in program. We recommended that the Department recover the overpayments, improve its oversight of local districts, and enhance Medicaid claim processing controls to ensure accurate payment of Medicare expenses for individuals enrolled in the buy-in program.

Key Finding

• Department officials made progress in addressing the problems we identified in our initial audit report. However, further actions are still needed as millions of dollars in questionable and improper Medicaid payments continue to be paid for people enrolled in the Medicare buy-in program. Since our initial audit, we identified $9.6 million in additional premium payments for individuals in the buy-in program whose eligibility was not re-assessed. We also identified $569,000 in additional premiums that were paid on behalf of individuals who had died. Of the initial report’s five audit recommendations, three were implemented, one was partially implemented, and one was not implemented.

Key Recommendation

• Officials are given 30 days after the issuance of the follow-up report to provide information on any actions that are planned to address the unresolved issues discussed in this report.

Other Related Audit/Report of Interest

Department of Health: Improper Payments Related to the Medicare Buy-In Program (2010-S-76)