Medicaid Program: Claims Processing Activity October 1, 2023 Through March 31, 2024
Learn how the AI-generated research projects were createdOverall Conclusion
The audit concluded that eMedNY reasonably ensured that Medicaid claims were submitted by approved providers, processed in accordance with Medicaid requirements, and resulted in correct payments. However, the audit identified a number of improper payments across several categories, totaling over $16.2 million, with DOH needing to take further actions to recover funds and strengthen controls; 10 providers were identified as violating program requirements, with nine removed from the program during fieldwork.
Source Document
Audit Scope
The audit covered the Department of Health’s eMedNY Medicaid claims processing activity from October 1, 2023 through March 31, 2024. It included processing of claims submitted by Medicaid providers, automated edits and controls within the eMedNY system, and related governance and enforcement actions. The scope also encompassed analyses of trends observed in the claims data outside the period when such trends warranted follow-up, including Medicare/third-party payer interactions, managed care premium payments, newborn/birth-related claims, inpatient and clinic services, pharmacological claims, and provider sanctions. The audit relied on MDW and eMedNY data, with samples including 1,831 claims totaling about $158.7 million (risk-based judgmental sample), 78 pharmacy claims (~$2.6 million), and all claims not conforming to comprehensive third-party insurance rules.
Key Findings Summary
Improper Managed Care Premium Payments for Recipients With Comprehensive Third-Party Health Insurance (approximately $11.8 million over Oct 2023–Mar 2024) due to disenrollment processes not being timely, resulting in improper premium payments.
Improper Fee-for-Service Payments for Inpatient Services Covered by Managed Care (88 overpayments totaling $1,969,028) due to retroactive managed care coverage and billing the fee-for-service when the recipient had managed care.
Incorrect Newborn Birth Claims (7 claims totaling $784,741) with incorrect birth weight reporting leading to overpayments; seven claims adjusted later with $707,116 in cost savings.
View the Findings tab to see all 9 findings
AI-Assisted
AI Scope Summary
Assess the effectiveness of DOH’s eMedNY claims-processing system in preventing improper Medicaid payments and ensuring payments are made only to approved providers, during October 1, 2023 through March 31, 2024, with follow-up on related trends outside this period as warranted.
AI-Generated Insight
This report demonstrates a strong overall control environment in eMedNY with no systemic failure in preventing improper payments, but it also highlights specific process gaps—particularly in disenrollment timing for recipients with concurrent third-party insurance, retroactive managed care coverage, newborn birth reporting, and accurate payer designation. The patterns indicate opportunities to enhance data quality, provider communication, and cross-system coordination (DOH, NYSOH, N.Y. corrections) to reduce improper payments and improve cost containment. The audit also shows the value of recovery efforts already in flight (over $2.8 million recovered) and the continuing work by DOH and OMIG to pursue recoveries and sanctions where appropriate.
Audit Objectives
To determine whether the Department of Health’s eMedNY system reasonably ensured that Medicaid claims were submitted by approved providers, were processed in accordance with Medicaid requirements, and resulted in correct payments to providers.
To assess whether processing of certain types of Medicaid claims and related controls were effective for the period October 1, 2023 through March 31, 2024, with follow-up on observations outside this period when trends warranted.
Audit Findings (9)
Improper Managed Care Premium Payments for Recipients With Comprehensive Third-Party Health Insurance (approximately $11.8 million over Oct 2023–Mar 2024) due to disenrollment processes not being timely, resulting in improper premium payments.
Improper Fee-for-Service Payments for Inpatient Services Covered by Managed Care (88 overpayments totaling $1,969,028) due to retroactive managed care coverage and billing the fee-for-service when the recipient had managed care.
Incorrect Newborn Birth Claims (7 claims totaling $784,741) with incorrect birth weight reporting leading to overpayments; seven claims adjusted later with $707,116 in cost savings.
Incorrect Maternity and Newborn Birth Claims Involving Managed Care (17 claims totaling $622,446) due to reporting errors; 16 adjusted for $504,684 in savings; one remaining $117,762; July 2024 reminder issued.
Improper Payments for Inpatient, Referred Ambulatory, and Clinic Claims ($569,435 overpayments across 4 inpatient, 30 referred ambulatory, and 2 clinic claims) with 4 adjusted ($531,322 savings) and $38,113 remaining.
Questionable Pharmacy Claims (14 claims totaling $394,898 for Targretin 1% gel) lacking sufficient medical necessity documentation; prescriber education; no additional claims billed subsequently.
Other Insurance on Medicaid Claims (overpayments totaling $126,786 due to incorrect designation of primary payer; $113,251 saved from one adjusted claim; $13,535 remaining).
Improper Managed Care Premium Payments During Recipient Incarceration (25 improper premium payments totaling $35,441 for 9 incarcerated recipients) with several cases where incarcerated individuals should have been moved to fee-for-service.
Status of Providers Who Violate Program Requirements (10 providers identified; 9 removed from Medicaid program; 1 under review).
Recommendations (10)
Recommendation 3: Formally advise the hospitals identified to accurately report newborn claim information when billing Medicaid to ensure appropriate payment.
Recommendation 4: Review the $117,762 in overpayments and make recoveries, as appropriate.
Recommendation 5: Review the $38,113 ($34,350 + $3,763) in overpayments and make recoveries, as appropriate.
Recommendation 6: Formally advise the hospital identified in this report to accurately bill Medicaid for the acquisition cost of certain practitioner-administered drugs.
Recommendation 7: Review the $394,898 in pharmacy payments and make recoveries, as appropriate.
Recommendation 8: Review the $13,535 in overpayments and make recoveries, as appropriate.
Recommendation 9: Review the $35,441 in overpayments and make recoveries, as appropriate.
Recommendation 10: Ensure providers who violate Medicaid or other health insurance program provisions are subject to appropriate and timely sanctions, including removal from the Medicaid program.
Recommendation 1: Review the $11.8 million in overpayments, disenroll the members from managed care plans, and make recoveries, as appropriate.
Recommendation 2: Review the $1,002,504 in overpayments and make recoveries, as appropriate.