Evidence record
Maryland Department of Health Medical Care Programs Administration Managed Care Program Audit Report
- Jurisdiction
- Maryland
- Publishing agency
- Maryland Office of Legislative Audits
- Publication date
- December 14, 2023
- Source record
- Original document linked
Findings
4
Recommendations
11
Overall conclusion
MDH’s corrective actions addressing the identified audit issues are considered sufficient to address all audit issues.
Scope
The audit scope covered a fiscal compliance review of the Maryland Department of Health (MDH) – Medical Care Programs Administration (MCPA) focused on the Managed Care Program (HealthChoice) for the period April 1, 2019 through March 31, 2022. It examined the MCPA’s monitoring of enrollment and disenrollment of Medicaid recipients in MCOs, the calculations of MCO capitation rates, and the oversight and processing of capitation and related payments. The audit included the use of MMIS II data, DPSCS incarceration data for cross-checking incarcerated individuals enrolled in HealthChoice, and the independent verification by a private accounting firm and a State university to support capitation rate calculations. The audit explicitly excluded procedures and controls over MCPA’s primary functions beyond HealthChoice, and excluded MDH’s other units and programs (e.g., Behavioral Health Administration’s Administrative Service Organization, the Maryland Pharmacy Program) which are reviewed in separate audits. The period under review spans April 1, 2019 to March 31, 2022.
Findings (4)
Each finding has a stable link.
- F-787
Finding 3 – Improper Medicaid Payments: MCPA did not have an effective process to identify capitation payments to MCOs for incarcerated individuals, resulting in approximately $14 million in improper payments during fiscal years 2019 to 2022.
- F-788
Finding 4 – MCPA did not investigate and recover potentially improper supplemental payments to MCOs for newborn deliveries totaling $10.4 million.
- F-785
Finding 1 – Capitation Rate Calculations: MCPA procedures were not sufficiently comprehensive to ensure the validity of MCO-reported expenditure data used in the capitation rate calculation.
- F-786
Finding 2 – MCPA did not have comprehensive procedures to ensure that ineligible costs reported by the MCOs were excluded from the capitation rate calculation.
Recommendations (11)
- R-698
Recommendation 4a: Investigate the propriety of all potentially improper newborn delivery supplemental claims.
Related finding F-788 - R-699
Recommendation 4b: Recover any amounts paid for improper claims, including those noted above.
Related finding F-788 - R-689
Recommendation 1a: Develop a more comprehensive methodology to validate the expenditure data used to calculate MCO capitation rates, including whether statistical sampling could be used to provide projections to the population of claims or capitation categories.
Related finding F-785 - R-690
Recommendation 1b: MDH/MCPA should take appropriate action, including expanding its review when reviews of MCO claims identify discrepancies and reduce cycle time for HFMR reviews.
Related finding F-785 - R-691
Recommendation 2a: Review claims denied by MMIS II and ensure improper payments are excluded from the expenditure data used in the capitation rate calculation.
Related finding F-786 - R-692
Recommendation 2b: Use available MCO data to ensure duplicate payments are not made for carved-out services and develop a reconciliation with BHASO for carved-out behavioral health claims.
Related finding F-786 - R-693
Recommendation 2c: Ensure claims paid for incarcerated individuals are excluded from the expenditure data used in the capitation rate calculation.
Related finding F-787 - R-694
Recommendation 2d: Take corrective action to address carved-out service claims that were improperly paid.
Related finding F-786 - R-695
Recommendation 3a: Work with DPSCS to obtain complete and accurate incarceration data for its match and engage the assistance of the Department of Budget and Management Audit Compliance Unit as necessary to resolve the matter.
Related finding F-787 - R-696
Recommendation 3b: Ensure incarcerated individuals are timely disenrolled from MCOs to prevent improper capitation payments.
Related finding F-787 - R-697
Recommendation 3c: Investigate the potential improper payments identified and take corrective action such as recovery of improper payments.
Related finding F-787