5 factors that pose a challenge to OIG’s Protection of Medicaid Program from Fraud, Waste, and Abuse

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Sep

Following the passing of the Patient Protection and Affordable Care Act (Affordable Care Act) into law, there has been rapid expansion of the Medicaid program in most states. By September 2015, 29 states and the district of Columbia had experience expansion of the program, both in the number of people served and money spent.
This rapid expansion however, has posed several challenges for OIG’s efforts to protect Medicaid against fraud, waste, and has affected Medicaid’s integrity in the following ways:

1. Ineligible people still continue to benefit from the program
Since 2013 when affordable care Act went into effect, 13.6 million more people enrolled for Medicaid and children’s Health Insurance Program (CHIP).
In 2014, an improper payment rate of 6.7% was reported, and was attributed to payments made to individuals who are not eligible to the program. Cases were noted for instance, where beneficiaries still remained in the program even after becoming ineligible for not residing in a state.
Though the Public Assistance Information System (PARIS) Medicaid Interstate Match program was put in place to deal with such errors, there’s lack of commitment from states and the system’s effectiveness is not consistent.

2. Provider fraud and beneficiary fraud in Medicaid Managed Care
Following a 75% enrollment of Medicaid beneficiaries for managed care in 2011, certain oversight measures such as: metrics for measuring integrity; availability and use of data in a timely and accurate manner; and ensuring beneficiaries can access services were put in place.
The OIG observed in a December 2011 report that provider fraud and beneficiary fraud are the main integrity concerns.
• Providers were found to bill for services they did not provide or that were unnecessary.
• Beneficiaries were found to have among other things, engaged in prescription drug abuse.
• Managed care plans also engaged in fraudulent acts such as manipulating bids in order to increase reimbursement.
• States failed to submit data showing the managed care services received by beneficiaries. This means there’s no data that CMS can use to identify fraud, waste and abuse and address it.
• Standards are also inconsistent. For example, the ratio of primary care provider to enrollee can vary from 1:100 to 1:2500 across states and this may prevent some beneficiaries from accessing care.

3. Poor effectiveness of Medicaid Data Systems.
For oversight and integrity enhancement to be effective, there’s need for Medicaid to have a functional database. But this is not the case as Medicaid data is incomplete, inaccurate and is not timely.
CMS has faced the following challenges in its attempts to improve data availability and quality:
• States have failed to fully roll out the Transformed Medicaid Statistical Information System (T-MSIS)
• Attempts at data sharing among states have failed. Even where implemented, data was often incomplete and not helpful. This prevented termination of care providers and in some cases, providers who had earlier been terminated in one state were still participating in Medicaid in other states.

4. Using State Policies to inflate Federal Costs
States have policies that result misalignment of costs and payments and this inflates federal spending on Medicaid. For instance, in fiscal year 2009, payments to New York’s Medicaid program were inflated by over $1billion. Pennsylvania also received more than $1billion from the federal government using managed care plans state tax as a basis.
State waiver programs also lack transparency, posing challenges in ensuring efficiency and reducing instances of cost inflation.
The CMS approval process for waivers is also unclear, contributing to further cost increases.

5. Ensuring Quality Care for Medicaid Beneficiaries.
OIG determined that children enrolled in Medicaid:
• Are not given all the preventive screenings required.
• Experience quality-of-care issues such as being treated with the wrong antipsychotic drugs or being given too many drugs.
Personal care services also have vulnerabilities arising from lack of program safeguards that are supposed to ensure quality service and safety of patients.

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