Federal audit raps Colorado’s $10B Medicaid program for poor safeguards against fraud, abuse

Federal audit raps Colorado’s $10B Medicaid program for poor safeguards against fraud, abuse

Colorado officers vowed to enhance oversight of the managed-care portion of the state’s $10 billion Medicaid program after a federal audit discovered poor safeguards towards waste, fraud and abuse.

Federal regulators reviewed the state’s supervision of managed care applications that subcontract with the Colorado Division of Well being Care Coverage and Financing to supply care to sufferers.

The audit by the federal Facilities for Medicare and Medicaid Companies reviewed Medicaid spending at three managed care applications within the state. The assessment discovered that from 2014 via 2016 these applications had recovered lower than $65,000 in overpayments to medical doctors, psychologists and different well being care professionals billing Medicaid. Throughout these years, the applications performed simply 19 investigations into allegations of waste, fraud or abuse, an quantity the auditors discovered “both low or nonexistent for a managed care program of Colorado’s dimension.”

The October 2017 audit discovered that Colorado has a “lack of efficient insurance policies and procedures” to information how the applications ought to deal with investigations, referrals and reporting necessities to the state when there are allegations of fraudulent Medicaid expenditures.

In interviews, Colorado officers disputed among the audit’s conclusions however stated they nonetheless had been working to place in place the modifications the audit really useful.

“We acknowledge the advantage of audits,” stated John Bartholomew, the chief monetary officer for HCPF. “They assist us turn into higher at our jobs. This one did assist us by actually hammering dwelling that there could possibly be higher coordination. Rather a lot already was underway, however it did get up further folks within the division, which is nice.”

Of the 28 states audited by the federal regulators prior to now three years solely three states — West Virginia, Alabama and California — had a poorer monitor file of overpayment recoveries from managed care suppliers than Colorado did. In distinction, Missouri collected $31 million in overpayments in three years from three suppliers reviewed there. In Pennsylvania, state officers recovered $443 million in Medicaid overpayments billed to a sampling of 4 suppliers, in keeping with that state’s audit.

Colorado’s audit recognized 11 areas for enchancment, together with the necessity for a brand new methodology to trace recognized overpayments in managed care applications. The audit additionally really useful that the state work with suppliers to bolster their techniques for stopping and investigating fraud. Of their response, Colorado officers agreed that this yr they’d overhaul their oversight insurance policies for suppliers within the Medicaid program and make the opposite really useful modifications.

Bartholomew stated solely about 5 % of the state’s Medicaid sufferers are in managed care plans, and that the majority well being care professionals immediately invoice Medicaid within the state. He added that in contrast to many different states, Colorado retains billing accountability even for managed care applications. Bartholemew stated that when direct billing by practitioners is taken under consideration, Colorado collects about $100 million yearly in overpayments via the complete Medicaid system. He confused that $100 million quantity consists of fraudulent billing in addition to cases when Medicaid by chance was billed when a affected person had different present insurance coverage.

The managed care suppliers the federal auditors reviewed had been Colorado Entry, an area nonprofit well being plan that gives bodily and behavioral well being companies; BHI, a behavioral well being care program that gives companies in Adams, Arapahoe and Douglas counties in addition to the town of Aurora; and Denver Well being, an area group of medical doctors, clinics, hospitals, pharmacies and different suppliers that present well being companies in Adams, Araphaoe, Denver and Jefferson counties.

The federal assessment discovered that the three managed care applications had been answerable for $506 million in Medicaid expenditures in 2016 and had almost 740,000 enrolled beneficiaries. This system integrity unit on the state’s Medicaid division “usually gave the impression to be uniformed” about managed care supplier efforts to forestall fraud, the audit discovered. In a single occasion, an overpayment of greater than $70,000 was found in 2014 by one managed care supplier, the audit discovered, however no referral had been made to the state.

The audit additionally discovered that the managed care suppliers “predominately depend on conducting supplier schooling geared toward altering aberrant billing patterns, which has resulted in a low variety of for-cause terminations.” As well as, the managed care suppliers “carry out very minimal audit actions,” the audit additional discovered. As well as, the managed care suppliers weren’t following state procedures for suspending funds to suspect medical doctors. “The state is in danger by failing to droop funds to suppliers towards whom there’s a credible allegation of fraud,” the audit discovered.

The audit additionally discovered that the managed care applications kicked 473 well being care practitioners out of their networks in 2014 via 2016, however simply two of these had been pressured out attributable to trigger. The variety of practitioners terminated for trigger “gave the impression to be both nonexistent or very low, in comparison with the variety of suppliers,” the audit discovered. The managed care applications had almost 7,000 well being care practitioners of their community, in keeping with the audit.

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