Deeper Than The Headlines: Don’t Forget Your Medicaid Compliance
CJ Wolf
Share:
We hear a lot about fraud and abuse involving the Medicare program, and rightfully so. But because Medicaid programs are state-run, we may not hear of Medicaid issues unless they are in the news, in the state we live or work in.
However, the OIG has recently engaged in dialogue about their efforts in ferreting out fraud and abuse in the Medicaid program. At the end of January 2017, Ann Maxwell, Assistant Inspector General Office of Evaluation and Inspections testified before the United States House of Representatives Committee on Energy and Commerce: Subcommittee on Oversight and Investigations Medicaid Oversight.
Additionally, on March 6, 2017, the OIG posted statistics and a podcast about their involvement with State Medicaid Fraud Control Units (MFCUs).
Both the Congressional testimony as well as the MFCU podcast shine a national light on the state-run Medicaid programs.
If you asked most people which federal healthcare program enrolled 74 million individuals and spent $574 billion in FY 2016, most would probably respond by answering “Medicare.” In actuality, the correct answer is Medicaid. Unfortunately, the OIG tells us the estimated Medicaid improper payments totaled $29.1 billion in FY 2015. The Medicaid target improper payment rate for FY 2015 was 6.7 percent. HHS did not meet this requirement and had an estimated improper payment rate of 9.8 percent. The OIG oversees federal grants to state MFCUs. OIG also assesses each MFCU’s performance and compliance with federal requirements. MFCUs investigate and prosecute Medicaid provider fraud and patient abuse or neglect under state law and receive referrals of credible allegations of fraud from state Medicaid agencies. OIG investigators often partner with MFCUs on joint investigations of Medicaid fraud.
In FY 2016, OIG investigative actions related to Medicaid resulted in 312 indictments, 348 criminal actions, and 308 civil actions. These Medicaid cases, some of which also involved Medicare, resulted in almost $3 billion in expected recoveries. OIG worked most of these cases jointly with MFCUs. OIG also excluded 3,635 providers and entities from Federal health programs in FY 2016. Ms. Maxwell’s testimony to the U.S. House of Representatives included, among other things, four specific areas of concern: personal care services, credit balances, dental services and excluded Medicaid providers from one state practicing in other states’ Medicaid programs.
Personal Care Services
One of the Medicaid areas OIG has concerns about is personal care services or PCS. PCS allow certain Medicaid beneficiaries to stay in their homes rather than live in institutional settings, which helps control Medicaid spending for long-term services and support. But PCS is also an area ripe for fraud and abuse.
According to Ms. Maxwell’s testimony, the OIG and the MFCUs have uncovered a disturbingly high number of cases of fraud and abuse by Medicaid personal care services providers. She cited one specific example from Illinois:
“In Illinois, a concerned neighbor found a Medicaid beneficiary in an incoherent state. The beneficiary was ultimately hospitalized for multiple days as a result of neglect. An investigation revealed that the beneficiary’s personal care attendant had not been there in over a week, yet the attendant had been submitting claims to the Illinois Home Services Program.”
If your organization is involved in PCS you may want to have your compliance program schedule a proactive audit or review in this area. CMS Program Integrity has a toolkit available to help prevent improper payments for PCS.
Credit Balances
Another area outlined by the OIG is credit balances. OIG is concerned states are not ensuring that providers detect and repay overpayments in patient accounts. States must rely on providers to review credit balances in patients’ accounts to detect overpayments and return them to the state. Medicaid credit balances occur when the reimbursement a provider receives for services rendered to a Medicaid beneficiary exceeds the charges billed. OIG found providers sometimes failed to reconcile patient records with credit balances and report and return the associated Medicaid overpayments to state Medicaid agencies. In August of 2015, the OIG released a report regarding these concerns.
And Ms. Maxwell’s recent testimony demonstrates the OIG still has these concerns.
Dental Services
The OIG has raised concerns about questionable billing by pediatric dentists in California. They found that 335 dental providers – representing 8 percent of California’s general dentists and orthodontists – either billed for an extremely large number of services or provided certain services to an extremely large number of children. These services included pulpotomies – often referred to as “baby root canals” – and extractions. OIG referred those providers to the state and CMS for follow-up. OIG feels CMS and states could do more to conduct similar analyses to detect and follow-up on questionable billing that may signal fraud or abuse, especially where there is a risk of patient harm. Their full report on this matter can be found here:
And concerns are not limited to California. In January, I blogged about a specific dental provider in Texas who settled for over $8 million related to allegations of Medicaid billing improprieties.
Excluded Providers
According to the OIG, Medicaid providers terminated from one state Medicaid program continued participating in other states’ programs. Failure to share data on terminated providers across states is inefficient and worse, it puts programs and patients at unnecessary risk of fraud or harm. CMS established a database meant to assist state Medicaid agencies in denying enrollment to providers who have been terminated for cause from Medicare or by another state Medicaid agency. Yet OIG found that 12 percent of providers who were terminated for cause from state Medicaid agencies in 2011 continued to participate in other state Medicaid agencies as of January 2012 and many continued to participate as late as January 2014. Beginning in 2018, state Medicaid agencies will be required to report to a Terminated Provider Database so OIG hopes to see improvements in this area. In closing, MFCUs and the OIG are focused on Medicaid fraud and abuse. Of interest are the MFCU statistics for FY 2016 found here.
The statistics are reported by state so you can see the number of investigations, indictments, charges, convictions, total dollar recoveries, expenditures and number of staff on board for each state.
As your compliance program grows and matures, make sure you consider your organization’s Medicaid risks and supplement your compliance program as necessary.
Questions or Comments?