On June 26, the Centers for Medicare and Medicaid Services (CMS) announced several new initiatives designed to improve the integrity of the Medicaid program.
Medicaid, along with the Children’s Health Insurance Program (CHIP), provides health coverage to more than 72.5 million Americans.
Total Medicaid spending increased from $456 billion in 2013 to an estimated $576 billion in 2016, including a $100 billion increase in the federal share. The Medicaid program is a joint federal-state entitlement program with the federal government reimbursing states a percentage of their program costs.
The recent increases in Medicaid spending, in part due to Medicaid expansion under the Affordable Care Act, has increased the importance of Medicaid program integrity.
The CMS initiatives focus on stronger audit functions, increased beneficiary eligibility oversight, and enhanced enforcement of state compliance with federal rules. The new initiatives include:
- CMS will begin targeted audits of some Medicaid managed care organizations’ (MCOs’) financial reporting to verify that claims experience matches what MCOs are reporting. Among other factors, the audits will include review of “high-risk vulnerabilities” identified by the US Government Accountability Office (GAO) and the Office of Inspector General (OIG) for the US Department of Health and Human Services (HHS). According to the GAO, nearly half of the federal government’s Medicaid expenditures — $171 billion in 2017 — were paid to MCOs. In September 2017, there were more than 270 MCOs operating across the country.
- CMS will conduct audits of Medicaid eligibility determinations in states previously reviewed by the OIG. The OIG has recently identified problems in California, Kentucky, Michigan, and New York as to those states’ Medicaid eligibility determinations.
Data Sharing & Analytics
- CMS has made it a priority to work closely with states to ensure CMS and other oversight entities have complete and accurate Medicaid data. For the first time, all 50 states, the District of Columbia and Puerto Rico now are reporting data on their Medicaid programs to the Transformed Medicaid Statistical Information System (TMSIS). CMS will use advanced analytics and other solutions to improve TMSIS data and use the data for program integrity purposes. The data will allow CMS to identify treatment anomalies, such as a patient receiving more than 24 hours of care in one day, and “other flags” to target for further investigation.
- CMS will share the knowledge it has gained from analyzing Medicare data sets to help states “apply algorithms and insights” to their Medicaid claims data to identify areas for further investigation.
- CMS will work with the states to enhance data sharing and collaboration to improve program integrity efforts for both the Medicaid and Medicare programs. As part of this initiative, CMS is making the Social Security Administration’s Death Master File available to states.
- CMS will pilot a process to screen Medicaid providers for the states to improve efficiency and coordination, reduce the burden on states and providers, and address one of the significant sources of error as measured by the Payment Error Rate Measurement (PERM). The most recent report shows nearly $36.7 billion in improper payments were made because of state non-compliance with Medicaid provider screening requirements.
- CMS will improve Medicaid provider education to reduce aberrant billing, including education on comparative billing reports (CBRs). Although administered by CMS, CBRs are developed under contract by eGlobalTech, a woman-owned federal services firm in Arlington, Va. CBRs show providers a statistical breakdown on various services and treatments so they can compare their practice with other providers in their state and across the nation. Providers who are significantly above average may find themselves subject to more investigation.
Transparency and Accountability
- Future versions of the Medicaid scorecard will include state Medicaid program integrity performance measures, including the Medicaid improper payment error rate.
The Bottom Line: Increasing Medicaid Program Integrity at Every Level
CMS already has several initiatives designed to protect Medicaid program integrity that include: managed care rate reviews, ensuring state compliance with the Medicaid managed care final rule, financial oversight, PERM reviews, the Medicaid Eligibility Quality Control (MEQC) program, Medicaid provider screening and enrollment, state program integrity reviews, the Medicaid Integrity Institute (MII), and the Unified Program Integrity Contractors (UPICs).
Taken together, these efforts to coordinate data and oversight with the states should increase Medicaid program integrity at every level.