Objective

To assess the extent of implementation of the five recommendations included in our initial audit report, Payments by Empire BlueCross for Hospital Services for Ineligible Members (Report 2019-S-32).

About the Program

The New York State Health Insurance Program (NYSHIP), administered by the Department of Civil Service (Civil Service), provides health insurance coverage to over 1.2 million active and retired State, local government, and school district employees, and their dependents. The Empire Plan is the primary health benefits plan for NYSHIP, covering 1.1 million members. Civil Service contracts with Empire BlueCross (Empire) to administer the Empire Plan’s hospital benefits.

Civil Service maintains the New York Benefits Eligibility and Accounting System (NYBEAS), the system of record for member enrollment and eligibility information. Civil Service provides Empire with a daily update file of NYBEAS changes, and Empire also has access to NYBEAS to confirm eligibility information. Eligibility information is entered into NYBEAS by a participating employer’s health benefits administrator (HBA), as well as by Civil Service.

Our initial audit report, issued on August 18, 2020, sought to determine whether Empire paid hospital claims for members who were not eligible for coverage. Our audit covered the period from January 1, 2014 through December 31, 2018. We reviewed a sample of hospital claims and identified $18.2 million that was paid for hospital services for ineligible members. Of the $18.2 million identified, Empire had recovered $11.5 million and found $2.1 million was beyond recoverability time frames, leaving $4.6 million yet to be recovered.

Key Finding

Civil Service and Empire made significant progress in addressing the problems we identified in the initial audit. In particular, Empire recovered over $5.4 million on behalf of the Empire Plan. Of the initial report’s five audit recommendations, two were implemented and three were partially implemented.

Key Recommendation

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