Multiple States Made Medicaid Capitation Payments to Managed Care Organizations After Enrollees’ Deaths
Learn how the AI-generated research projects were createdOverall Conclusion
The report concludes that improper Medicaid capitation payments to MCOs on behalf of deceased enrollees remain a persistent issue across states, with prior unallowable payments totaling about $249 million and ongoing uncollected federal shares. While CMS has made substantial progress implementing prior recommendations and recovering overpayments (about $126 million collected), the OIG identifies additional data-matching and oversight steps—particularly routine matching of T-MSIS enrollment data against SSA’s Death Master File—to further reduce improper payments and strengthen program integrity.
Source Document
Audit Scope
This performance audit summarizes the results of 14 prior OIG audits that identified unallowable Medicaid capitation payments made by States to managed care organizations (MCOs) on behalf of deceased enrollees, covering audit periods from July 1, 2009, through December 31, 2019, with total unallowable payments of about $248.6 million ($171.8 million Federal share) identified across 14 states. It also reviews CMS actions and potential enhancements to oversight, including a proposed data-matching process between the Transformed MSIS (T-MSIS) enrollment data and SSA’s Death Master File (DMF) to identify high-risk states and verify and recover improper payments. The audit work was conducted December 2020 through June 2023, and CMS comments extend to August 2023. The scope does not assess the overall CMS internal control structure or the Medicaid program beyond audit resolution and program integrity-related controls.
Key Findings Summary
In prior audits of 14 states, unallowable Medicaid capitation payments to MCOs on behalf of deceased enrollees totaled approximately $249 million ($172 million Federal share); CMS concurred with all recommendations and actions have been taken on most.
In this audit, CMS could take additional actions to help states continue to make improper capitation payments by developing a process to routinely match Transformed Medicaid Statistical Information System (T-MSIS) enrollment data against the Social Security Administration’s Death Master File (DMF) data to identify high-risk states and provide results to thos…
The total unallowable capitation payments identified across the 14 states were $248,573,235; Federal share was $171,817,215; $41,003,804 of the Federal share remained uncollected as of the audit period and CMS is working with the states to collect it.
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AI-Assisted
AI Scope Summary
Summarize the results of 14 prior OIG audits on Medicaid capitation payments to MCOs for deceased enrollees, quantify the total unallowable payments and collections, and identify CMS actions (including data-matching and targeted oversight) to reduce future improper payments.
AI-Generated Insight
This analysis highlights a persistent vulnerability in Medicaid program integrity: despite multiple prior audits and CMS actions, billions in federal funds remain exposed to improper capitation payments to MCOs after enrollees’ deaths. The report underscores the value of data-driven, cross-system matching (T-MSIS with DMF) and CMIP-aligned oversight as critical levers to detect, deter, and recoup improper payments, and to guide targeted technical assistance to high-risk states.