Purpose

To determine the extent of implementation of the five recommendations made in our audit report, Overpayments of Certain Medicare Crossover Claims (2011-S-28).

Background

Many Medicaid recipients are also enrolled in Medicare, the federal health care program for people 65 years of age and older and people under 65 years old with certain disabilities. Individuals enrolled in both programs are referred to as “dual-eligibles.” Generally, Medicare is the primary payer for medical services provided to dual-eligibles. Medicaid then typically pays for any remaining balance not covered by Medicare, including deductibles and coinsurance. On December 3, 2009, the Department of Health (Department) implemented the Medicare/Medicaid claim crossover system. Under this system, providers submit medical claims for dual-eligible individuals to Medicare. After Medicare processes the claims, they are electronically transferred to the Medicaid claims processing system (eMedNY) for payment of Medicare deductibles, coinsurance and copayments. Prior to the automated crossover system, the Department relied on providers to self-report accurate information to eMedNY regarding how much Medicare paid and how much Medicaid owed, which often led to incorrect Medicaid payments.

Our initial audit report, which was issued on January 10, 2013, identified $10 million in Medicaid overpayments. The overpayments occurred because of flaws in eMedNY computer programs designed to process electronic Medicare crossover claims. Auditors additionally identified $16.4 million in potential overpayments on similar claims because providers submitted their claims directly to Medicaid and bypassed the crossover system and the controls that it affords. We made five recommendations to the Department to review and recover the improper Medicaid payments and design and implement controls within eMedNY to properly process and pay crossover claims.

Key Finding

• Department officials made progress in addressing the problems we identified in the initial audit report. This included the recovery of $977,343 in Medicaid overpayments. However, further actions are still needed. Of the initial report’s five audit recommendations, one was implemented and four were partially 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 Audits/Reports of Interest

Department of Health: Overpayments of Certain Medicare Crossover Claims (2011-S-28)
Department of Health:  Overpayments for Services Also Covered by Medicare Part B (2012-S-27) 
Department of Health:  Overpayments for Services Also Covered by Medicare Part B (2010-S-50)