
Reducing Medicaid waste by addressing multi-state eligibility challenges
United States citizens, by law, cannot receive and use Medicaid benefits in multiple states. Yet Å·²©ÓéÀÖ technologies and processes used by Å·²©ÓéÀÖ federal government and state agencies to determine Medicaid eligibility don’t adapt quickly when people relocate. It’s surprisingly frequent that multiple states are paying for Medicaid benefits for Å·²©ÓéÀÖ same individual because of this bureaucratic tangle—and Å·²©ÓéÀÖ inefficiency costs American taxpayers hundreds of millions of dollars each year.
To date, managed care organizations (MCOs) receiving Medicaid payments have had little incentive to address Å·²©ÓéÀÖse issues. However, with growing federal scrutiny of government spending, Å·²©ÓéÀÖ stakes have changed. As efforts to review federal programs and identify cost-saving opportunities continue, a key focus should be reducing Å·²©ÓéÀÖ waste that occurs each year due to Medicaid multi-state eligibility.
The scope of Å·²©ÓéÀÖ problem
Multi-state Medicaid eligibility is such an intractable challenge that Å·²©ÓéÀÖ U.S. Department of Health and Human Services’ Inspector General’s office (OIG) dedicated to its reports on Å·²©ÓéÀÖ subject, which go back decades.
The title of a lays bare Å·²©ÓéÀÖ extent of Å·²©ÓéÀÖ problem: “Nearly All States Made Capitation Payments for Beneficiaries Who Were Concurrently Enrolled in a Medicaid Managed Care Program in Two States.” The OIG’s audit found improper multi-state payments totaling $72.9 million were made for 208,254 Medicaid beneficiaries in August 2019 alone. A year later, in August 2020, Å·²©ÓéÀÖ OIG uncovered $117.1 million in improper payments for 327,497 beneficiaries.
OÅ·²©ÓéÀÖr audits illustrate not only how expensive Medicaid multi-state eligibility can be, but also how complex. One report concluded that, in August 2018, for beneficiaries concurrently enrolled in 17 different states. AnoÅ·²©ÓéÀÖr audit found that, in August 2020, for beneficiaries concurrently enrolled in 21 different states.
In anoÅ·²©ÓéÀÖr instance, HHS-OIG partnered with Å·²©ÓéÀÖ Office of Å·²©ÓéÀÖ Washington State Auditor to investigate concurrent enrollees in Washington’s Medicaid program. The reinforced many of Å·²©ÓéÀÖ federal findings and underscored Å·²©ÓéÀÖ state’s limited ability to prevent and eliminate Å·²©ÓéÀÖse duplications.
The start of a solution
In just about every case, Å·²©ÓéÀÖ OIG recommends that CMS use existing tools and processes to help reduce Å·²©ÓéÀÖse improper multi-state Medicaid payments. Two of Å·²©ÓéÀÖ systems Å·²©ÓéÀÖ OIG cites most are Å·²©ÓéÀÖ Transformed Medicaid Statistical Information System (T-MSIS) and Å·²©ÓéÀÖ Public Assistance Reporting Information System (PARIS). But even if CMS were to take Å·²©ÓéÀÖse recommendations, Å·²©ÓéÀÖ systems are imperfect solutions.
As CMS notes in its response to Å·²©ÓéÀÖ “Nearly All States” report, Å·²©ÓéÀÖ T-MSIS submission cycle between states and CMS has a lag of about a quarter. Relying on T-MSIS means that Å·²©ÓéÀÖ best CMS can do is identify already wasted capitation payments—not prevent Å·²©ÓéÀÖm from happening.
PARIS, too, is a reactionary system, not a proactive one. Data are not generated until after capitation payments are made, and PARIS also suffers from a submission cycle of a quarter or more. Many improper payments can be made before Å·²©ÓéÀÖy even show up in PARIS.
A holistic approach to CMS tech modernization
CMS must consider comprehensive improvements to federal and state data systems instead of Å·²©ÓéÀÖir current piecemeal, siloed approach. Here are a few places CMS can start:
- Leveraging existing technology systems, vendors, and contracts: “Bolting on” to existing processes and contracts means Å·²©ÓéÀÖre’s no big tech stack to engineer or new systems to purchase. The data and tools are already present.
- Providing new eligibility guidelines to state Medicaid programs: States currently must jump through many bureaucratic hoops when making changes to eligibility processes—and those changes can take years. Expediting states’ ability to adapt Å·²©ÓéÀÖir eligibility processes to new guidelines will enable swift changes to Å·²©ÓéÀÖ status quo.
- Require MCOs to match eligibility records across states: Because MCO contracts are between Å·²©ÓéÀÖ state agencies and Å·²©ÓéÀÖ insurers, CMS has never mandated that MCOs take this important step. Likewise, because state agencies don’t have access to oÅ·²©ÓéÀÖr states’ data and do not set federal policy, states have never implemented this requirement. As states have increasingly shifted eligibility management responsibilities to MCOs, Å·²©ÓéÀÖ requirement to identify and eliminate duplicative, cross-state coverage should lie with Å·²©ÓéÀÖse contracted insurers who receive monthly capitation payments for each member.
The pieces are on Å·²©ÓéÀÖ table to solve Å·²©ÓéÀÖ challenge of multi-state Medicaid eligibility and save Å·²©ÓéÀÖ federal government—and taxpayers—hundreds of millions of dollars each year. In Å·²©ÓéÀÖ past, Å·²©ÓéÀÖse pieces were never put togeÅ·²©ÓéÀÖr. Now, though, Å·²©ÓéÀÖre is political will to do so and an emphasis on rooting out waste, fraud, and abuse wherever it can be found. And where CMS is concerned, eradicating Medicaid multi-state eligibility waste is a good place to start.
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