Objective

To determine the extent of implementation of the eight recommendations made in our initial audit report, Managed Care Organizations: Payments to Ineligible Providers (Report 2016-S-59).

About the Program

Medicaid providers who violate statutory or regulatory requirements related to the Medicaid or Medicare programs or who have engaged in other unacceptable insurance practices can be excluded from the Medicaid program. These ineligible providers should not receive payments from Medicaid Managed Care Organizations (MCOs) for services rendered to Medicaid recipients.

We issued our initial audit report on February 26, 2018. The audit objective was to determine whether the Department of Health (Department) and MCOs had adequate processes in place to prevent payments to ineligible providers, and whether improper payments were made to ineligible providers. During the five-year audit period ended December 31, 2016, we determined MCOs improperly paid $50.3 million to providers who were excluded from the Medicaid program or who were otherwise ineligible to receive Medicaid payments. We also identified 22.5 million MCO claims (totaling over $2 billion) that lacked the provider identification information needed to assess the propriety of payments.

We recommended that the Department: ensure the MCOs recover the improper payments; obtain the missing provider IDs on the claims that lacked this information, assess those claims, and ensure recoveries are made; and improve monitoring efforts to aid MCOs in detecting and recovering improper payments to ineligible providers.

Key Finding

Department officials made progress in addressing the problems we identified in the initial audit; however, additional action is needed. The Department did not distribute the claims data supporting the $50.3 million in findings to the MCOs until after our follow-up was initiated and was in the process of compiling responses from the MCOs at the end of our review. The Department obtained the missing provider IDs for 19.3 million of the 22.5 million claims, and the Office of the Medicaid Inspector General was reviewing the appropriateness of the corresponding payments. Also, certain Department monitoring efforts were enhanced. Of the initial report’s eight audit recommendations, two were implemented, five were 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.