Office of Medicaid (MassHealth)-Review of Claims Submitted by Hudson Home Health Care, Inc.
April 19, 2016 · Office of Medicaid (MassHealth) · Read the full official report (PDF) ↗ · official site ↗
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“Based on our audit, we have concluded that Hudson billed MassHealth and received payments of $557,006 for wheelchairs and wheelchair components contrary to state regulations for the transactions reviewed.”
Read the plain-English breakdown
This is a Massachusetts State Auditor review of claims Hudson Home Health Care submitted to MassHealth for wheelchairs and wheelchair parts from 2012 through 2014.
“The Office of the State Auditor has conducted an audit of claims for wheelchairs and wheelchair components submitted by Hudson Home Health Care, Inc.2 to MassHealth for the period January 1, 2012 through December 31, 2014.”
The auditor checked whether Hudson billed and got paid for wheelchair equipment according to state rules.
“The objective of our audit was to determine whether Hudson submitted claims and received payments for these items in accordance with certain established state regulations.”
MassHealth is a very large public program, so billing errors can affect taxpayer money and public trust.
“Medicaid expenditures represent approximately 38% of the Commonwealth’s total annual budget.”
If you are a Massachusetts taxpayer or MassHealth member, this audit is about whether public healthcare dollars were spent properly and whether providers followed the rules.
“MassHealth provides access to healthcare services to approximately 1.9 million eligible low- and moderate-income children, families, seniors, and people with disabilities annually.”
The audit found two main problems: Hudson billed above the lowest prices it accepted elsewhere, and it was also overpaid for some items MassHealth priced individually.
“Below is a summary of our findings and recommendations, with links to each page listed.”
The report says Hudson should work with MassHealth to figure out and repay overpayments, and MassHealth said it would seek repayment and improve billing guidance.
“MassHealth agrees with the recommendation that Hudson collaborate with MassHealth to repay the overpayment of approximately $474,486 resulting from the overpayments identified through this audit and will work with Hudson to determine whether additional overpayments resulted from similar improper billings.”
The report highlights weaknesses in MassHealth payment controls and says this kind of oversight is important to keep confidence in the Medicaid program.
“As with any government program, public confidence is essential to the success and continued support of the state’s Medicaid program.”
A “usual and customary charge” means the lowest price the provider charges or accepts for the same equipment from any payer, not just a posted price.
“The lowest price that an eligible provider charges or accepts from any payer for the same equipment or item, including but not limited to the shelf price, sale price or advertised price.”
What the Auditor checked
- Did not comply Did Hudson bill MassHealth the appropriate amounts (i.e., the lowest usual and customary prices) for wheelchairs and wheelchair components in accordance with state regulations?
- Did not comply Did Hudson submit the required current receipted invoices to MassHealth for wheelchair components that were not listed in the Center for Healthcare Information and Analysis (CHIA) rate schedule?
What the Auditor found
Why it matters: MassHealth overpaid Hudson by at least $474,486, creating unnecessary costs to the Commonwealth.
Standard: 114.3 CMR 22.03(2) requires payment at the lower of the provider's usual and customary charge to the general public or the CHIA rate schedule, and 114.3 CMR 22.02 defines usual and customary charge as the lowest price accepted from any payer. ( 114.3 CMR 22.03(2); 114.3 CMR 22.02 )
4 recommendations
- Hudson should submit claims for wheelchair components based on its lowest accepted prices.agency: disagreed
- Hudson should develop, maintain, and make available to MassHealth a list of its lowest accepted prices for all wheelchair components.agency: disagreed
- Hudson should collaborate with MassHealth to determine any potential amounts due to the Commonwealth identified in this finding and determine whether additional overpayments resulted from similar improper billings for wheelchair components that were not tested.agency: disagreed
- Hudson should periodically review MassHealth’s and CHIA’s billing and payment regulations and update its policies and procedures accordingly.agency: disagreed
Agency response & Auditor reply
Agency: "Hudson Home Health Care, Inc. (Hudson) has properly billed and received payment for Durable Medical Equipment (DME) in accordance with MassHealth regulations."
Auditor: "This is not accurate."
Why it matters: MassHealth overpaid Hudson approximately $82,520 and could not correctly determine adjusted acquisition costs for certain components.
Standard: 114.3 CMR 22.02 requires providers to keep adequate records and submit current invoices for individual consideration claims, with payment based on the lower of usual and customary charge or adjusted acquisition cost plus standard markup for new wheeled mobility system equipment and related accessories. ( 114.3 CMR 22.02; 114.3 CMR 22.02 )
2 recommendations
- Hudson should submit current receipted invoices to MassHealth when claiming payment for individually priced wheelchair components, and these invoices should clearly specify all discounts, rebates, and warranties.
- Hudson should collaborate with MassHealth to repay the Commonwealth the $82,520 in overpayments identified in this finding and determine whether additional overpayments resulted from similar improper billings for wheelchair components that were not tested.
Agency response & Auditor reply
Agency: "Hudson has not been provided any specific information on any of the 53 individual findings in the population of 76 total claims reviewed."
Auditor: "Thus, contrary to its response, Hudson was aware of the overpayments it received from 53 of these claims."
Verified dollar findings
Money paid out that the audit found should not have been - overpayments, unallowable and nonreimbursable charges, improper claims.
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