GAO Highlights Gap in Medicaid Managed Care Program Integrity Efforts

A GAO study, released on June 18, identified fragmentation and gaps in responsibility in relation to Medicaid managed care program integrity.  The GAO emphasized the importance of increased attention to, and coordination of, activities to protect against fraud, waste and abuse in Medicaid managed care programs, particularly given growing enrollment in Medicaid managed care plans.  Specifically, the GAO recommended that CMS:

• Hold states accountable for Medicaid managed care program integrity by requiring states to conduct audits of payments to and by managed care organizations;
• Update CMS’s Medicaid managed care guidance on program integrity practices and effective handling of [managed care organization] recoveries; and
• Provide the states with additional support in overseeing Medicaid managed care program integrity, such as the option to obtain audit assistance from existing Medicaid integrity contractors.

(GAO, "Medicaid Program Integrity: Increased Oversight Needed to Ensure Integrity of Growing Medicaid Expenditures," May 2014)

Even before the release of the GAO study, New York's Office of the Medicaid Inspector General (OMIG) apparently reached similar conclusions and included in its 2014-15 work plan several audit initiatives targeted at Medicaid managed care plans, including among others:

• Working with the Department of Health to examine managed care plan encounter coding policies;
• Reviewing managed care plan cost reports in connection with covered benefits that have not traditionally been included in Medicaid managed care to determine whether unallowed costs were included in the reports;
• Reviewing enrollment records to determine whether enrollment in MLTC plans was proper and whether MLTC plans provided proper care management to selected members; and
• Reviewing managed care edits that validate encounter records and working with plans to strengthen system controls.

Federal and state oversight agencies are likely to ramp up their activities in relation to Medicaid managed care plans as managed penetration grows in New York State.

Contact: Karen Lipson, klipson@leadingageny.org, 518-867-8383, ext. 124