MO Medicaid Home Healthcare Program Received Improper Payments

Missouri claimed $3.4 million in improper payments for its Medicaid home healthcare program providers and did not comply with federal and state Medicaid requirements, according to a report from the Office of Inspector General (OIG).

During fiscal year 2019, states claimed a total of $611 million in federal Medicaid reimbursement for health home services, which provide Medicaid members with coordinated care at a reduced cost. The annual federal share was $408 million. Missouri’s health home program was responsible for four percent of the federal share, prompting OIG to investigate.

Out of 1.3 million payments that Missouri made to health home providers between 2016 and 2018, OIG looked at a stratified random sample of 150. The agency examined the health home providers’ documentation as well as members’ medical records and other necessary documentation.

The audit found that Missouri claimed federal Medicaid reimbursement for 14 payments that did not meet federal and state requirements. The health home providers involved with these payments did not keep sufficient documentation, such as failing to document core services, the report explained.

OIG estimated that the state incorrectly claimed at least $3.4 million in federal Medicaid reimbursement.

Medicaid requires that health home providers maintain accurate medical records for the services they provide to patients. Missouri failed to properly monitor the providers’ compliance to this rule, resulting in the improper payments.

As a result, OIG made recommendations about next steps that Missouri can take to resolve the state’s incorrect claims.

First, the OIG recommended that Missouri refund the $3.4 million to the federal government. However, the state did not agree with this suggestion and claimed the OIG’s findings were not accurate.

“Missouri said that the rejected sampled payments complied with the State plan and Federal documentation requirements and that these payments did not violate State policy,” the OIG report stated.

“Missouri also said that we had not adequately explained our basis for rejecting these payments, and added that extrapolation was inappropriate in this audit.”

However, OIG reviewed the comments and the additional documentation Missouri provided and reaffirmed their original findings. OIG noted that federal courts have routinely used statistical sampling and extrapolation to detect false Medicaid reimbursement claims.

OIG’s second recommendation was that Missouri improve its monitoring of health home providers to make sure that they are complying with the federal and state documentation requirements. Missouri agreed that the health home programs should be more closely monitored and shared its plans to ensure improvement.

Missouri is not the first state in 2021 to have been subject to a Medicaid payment audit. Audits have uncovered improper Medicaid payments in other states’ programs as well.

Earlier this year, North Carolina’s Medicaid program spent millions of dollars on improper Medicaid payments. An audit of the state’s Department of Health and Human Services uncovered that the department failed to identify and disenroll Medicaid providers whose licenses had been suspended or terminated.

Providers who had license limitations also continued to receive Medicaid payments from the department. These credential mishaps contributed toward the additional $13.4 million that the state paid out in overpayments to North Carolina Medicaid providers.

The US Department of Health and Human Services found that total improper payments amounted to $57.36 billion during fiscal year 2019, the same year that Missouri’s Medicaid program overpaid health home providers. Nearly 15 percent of these improper payments nationwide were Medicaid payments.

In addition to its health home reimbursement audit, Missouri has faced other Medicaid hurdles in 2021. In July, the state’s Medicaid expansion initiative passed, but courts paused the initiative after deeming it unconstitutional.

The expansion may have expanded coverage to 275,000 individuals who would have otherwise fallen into a coverage gap. Opponents to the initiative claimed that providing state allocated funds to the initiative was unconstitutional.