OIG: HRSA Made Improper Payments Through COVID-19 Uninsured Program

The Health Resources and Services Administration (HRSA) made improper COVID-19 Uninsured Program payments to providers that totaled an estimated $784 million, a report from the Office of Inspect General (OIG) found.

The COVID-19 Uninsured Program, administered by HRSA, allowed providers to enroll and submit claims for reimbursement of COVID-19 testing and treatment provided to uninsured individuals. OIG conducted the audit to determine if claims reimbursed through the program complied with federal requirements.

The audit covered claims for 19 million patients with associated Uninsured Program provider payments totaling $4.2 billion between March 1 and December 31, 2020. OIG reviewed a stratified sample of 300 patients with associated provider payments totaling $2.8 million. In addition, OIG interviewed HRSA officials and analyzed health insurance coverage data and medical and billing records.

The report found that HRSA made payments to providers through the program for COVID-19 testing and treatment claims that did not comply with federal requirements.

Uninsured Program payments for COVID-19 service claims met the requirements and were made on behalf of uninsured individuals for 240 of the 300 sampled patients. OIG also found that providers had effective processes to ensure they did not engage in balance billing or charge patients cost-sharing.

However, payments for 58 of the sampled patients that totaled $294,294 were determined to be improper as they were made on behalf of individuals who had health insurance coverage, they were for testing and treatment services not provided, or they were unrelated to COVID-19.

Specifically, for 38 of the 300 patients, HRSA provided Uninsured Program payments totaling $148,432 to providers on behalf of individuals with health insurance coverage. For 22 of the patients, payments were made for testing or treatment services that were not provided or were unrelated to COVID-19, including surgery on a broken ankle.

Based on the sample results, OIG estimated that nearly $784 million of the $4.2 billion in Uninsured Program payments made to providers were improper.

“We understand that HRSA’s operational objective for the [Uninsurance Program] was to rapidly disburse funds for COVID-19 testing and treatment to ensure that uninsured individuals were receiving vital health care services and to prevent the spread of COVID-19,” OIG wrote. “However, if HRSA or another HHS agency administers any programs of a similar nature in the future, it should consider the information included in this report.”

OIG recommended that HRSA recover the $294,294 in improper payments and identify any additional improper payments made through the Uninsured Program, which OIG estimates to be $783.6 million.

Additionally, HRSA recommended HRSA strengthen its procedures for future similar programs by expanding insurance verifications, ensuring data sources used to verify health insurance coverage are reliable, and developing an assessment strategy to ensure claims are appropriately reimbursed to providers.

HRSA concurred with the conclusions about improper payments made for testing and treatment services that were not provided or related to COVID-19. The agency said it would analyze the claims associated with payments made for those with health insurance coverage.