Office of the State Auditor-Annual Report Medicaid Audit Unit

State law required the Auditor to report on MassHealth findings, recovery efforts, MassHealth responses, and recommendations to improve getting money back when improper payments are found.

“The state’s fiscal year 2013 budget (Chapter 139 of the Acts of 2012) requires that the OSA submit a report to the House and Senate Committees on Ways and Means by no later than March 15, 2013 that (a) details all findings on activities and payments made through the MassHealth system; (b) includes, to the extent available, a review of all post-audit efforts undertaken by MassHealth to recoup payments owed to the Commonwealth due to identified fraud and abuse; (c) includes responses of MassHealth to the most recent post-audit review survey; and (d) includes the OSA’s recommendations to enhance recoupment efforts.”

If you rely on MassHealth, pay taxes, or care about state spending, this report is about whether public healthcare dollars are going only to eligible people and properly billed services.

“The Massachusetts Executive Office of Health and Human Services administers the state’s Medicaid program, known as MassHealth, which provides access to healthcare services annually to approximately 1.3 million eligible low- and moderate-income children, families, seniors, and people with disabilities.”

The Auditor says MassHealth had fixed some problems, was still working on many others, and was trying to recover more than $6 million, though some providers were fighting repayment.

“Based upon the survey results, MassHealth has fully implemented 31% of our audit recommendations and the remaining 69% are in various stages of implementation.”

The Auditor’s office planned to keep auditing areas such as emergency services for certain noncitizens, medical equipment, dental records, children’s services, drug screenings, and pharmacy claims.

“The OSA is currently conducting an audit of 100% of Limited Program expenses for fiscal years 2011 and 2012 to ensure that MassHealth (a) pays for claims for emergency services in accordance with state regulations, (b) maintains edits within its claims processing system to detect and deny claims that represent non-emergency care, (c) obtains necessary service information from medical service providers in order to properly evaluate and process claims, and (d) monitors system outputs to identify billing irregularities and potentially fraudulent claims.”

The report says the audits are meant not just to recover bad payments, but to fix broader system problems so MassHealth avoids improper spending in the future.

“In this regard, as a result of the OSA’s audit work, MassHealth has instituted a number of operational changes that will result in the prevention of millions in unnecessary payments for Medicaid services annually.”

“Data mining” means the auditors used software to review all paid claims in an audit area, instead of only checking a small sample, so they could spot patterns, odd billing, and possible fraud.

“Instead, prior to starting each new audit engagement, the Unit uses data mining software to analyze 100% of the paid claims under audit.”