DiNapoli: Lax oversight of Medicaid funds behind $700 million in improper funds

According to an audit by State Comptroller Thomas P. DiNapoli, hundreds of millions of dollars were spent on Medicaid Managed Long-Term Care (MLTC) costs for people who no longer qualified for the program. The audit found that inadequate oversight by the State Department of Health (DOH) over more than six years resulted in over $700 million in overpayments for ineligible members and $2.8 billion in minimal services for entitled members led.

“My last Medicaid audit found more examples of how oversight weaknesses are imposing unnecessary costs on taxpayers. This time, failure to effectively monitor funds enabled $701 million worth of improper spending and may also have resulted in unsatisfactory long-term care for eligible patients in need,” State Comptroller DiNapoli said. “I urge DOH to recover any overpayments and improve oversight of its managed long-term care program to ensure patients receive the services to which they are entitled.”

Medicaid’s MLTC program provides long-term care services, such as home nursing and nursing home care, to chronically ill or disabled patients. To be eligible, patients must meet certain criteria such as: B. Long-Term Community Care Needs (CBLTC) for more than 120 days. Some people are automatically registered with the MLTC, others can register voluntarily. DOH contracts with Maximus Health Services Inc. to assess whether individuals who voluntarily enroll meet the MLTC criteria.

MLTC plans have been responsible for conducting semi-annual evaluations of their membership to determine if members still qualify to remain in the MLTC and in their plans. During the January 2015 through March 2021 audit period under review, auditors identified issues with MLTC plans’ verification of member eligibility and their processes for removing members who no longer qualified for MLTC. In one example, from 2016 through 2021, Medicaid made 48 monthly premium payments to an MLTC plan totaling $151,490 on behalf of a patient who should not have remained in the MLTC program. Despite being ineligible, the member was continuously assessed as eligible and in need of MLTC.

Aside from non-eligible individuals remaining enrolled in MLTC plans, in some cases, eligible members may not receive paid services. Auditors found 626,435 payments totaling $2.8 billion made on behalf of 51,947 members who received minimal benefits. MLTC is for chronically ill and disabled people who choose to stay at home and in their communities. Still, 42% of these members only received between 1 and 30 days of benefits during their six-month assessment periods (e.g., one patient may have received only one day of benefits in six months, while another received an average of just five days of benefits each month over six months ). In some cases, MLTC plans received premium payments that significantly exceeded the benefits paid. For example, an MLTC member who was reassessed six times as requiring community care received fewer than 28 days of benefits during each six-month assessment period. Payments from the state for this patient’s treatment totaled $268,724 over the three-year period, but the patient only received $13,907 in benefits.

Oversight of the MLTC program is critical as it helps ensure members receive the care they need and contains costs. These are services that are more expensive than others because the premiums paid for MLTC plans are often higher than other types of Medicaid managed care. Individuals who are not eligible for MLTC but are still eligible for Medicaid may be eligible for one less switching to expensive Medicaid insurance. MLTC plan officials and DOH attributed problems with membership administration and service delivery to multiple factors, including: an inability to engage with members who are believed to be ineligible; the COVID-19 pandemic; and the lack of DOH systems to identify members who are not receiving services.

Audit recommended by DiNapoli:

  • A review of $701 million of improper payments identified in the report to ensure overpayments are appropriately recovered;
  • Developing a process to ensure timely MLTC opt-out of members who are no longer eligible for MLTC coverage;
  • re-evaluate the process and timeline for deregistering ineligible members from the MLTC; and
  • Monitoring MLTC participants to ensure they are properly assessed and receiving the appropriate level of care.

In response to our review, DOH generally agreed with the recommendations and indicated that actions are being taken to address them.

Medicaid Program – Monitoring Eligibility of Managed Long-Term Care Members

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