Government Officials And Agencies Work To Strengthen Medicaid’s Integrity

07 Sep Government Officials And Agencies Work To Strengthen Medicaid’s Integrity

In 2017, improper payments within the Medicaid program reached a total of $37 billion, according to CMS. That equals 10 percent of the federal dollars spent on the program. Moreover, 99.2 percent of the payments made were overpayments. To make matters worse, under the current legislation, national health spending is expected to reach $5.7 trillion by 2026. When considering the soaring costs of healthcare and the program’s growth from expansion under the Affordable Care Act, government officials are concerned about sustainability.

In an effort to address Medicaid fraud and overpayments, the Senate Homeland Security and Governmental Affairs Committee held a hearing in June. Over the course of the hearing, the ranking members and witnesses discussed the rising costs associated with Medicaid and what efforts should be made so that federal dollars are spent efficiently and effectively.

GAO Recommendations

Comptroller General Dodaro represented the GAO at the hearing and presented actions to mitigate improper payments and program integrity risks. He pointed out that Medicaid’s unique state-by-state structures combined with the size of the program are two elements that make overseeing the program challenging.

The GAO identified improper payments, supplemental payments, and demonstrations as three areas of risk within Medicaid that are projected to exceed $900 billion by 2025. In order to bolster oversight and address risk, the GAO recommended the following:

Improve Data

“The Centers for Medicare & Medicaid Services (CMS), which oversees Medicaid, needs to make sustained efforts to ensure Medicaid data are timely, complete, and comparable from all states, and useful for program oversight. Data are also needed for oversight of supplemental payments and ensuring that demonstrations are meeting their stated goals.”

Target Fraud

“CMS needs to conduct a fraud risk assessment for Medicaid, and design and implement a risk-based antifraud strategy for the program.”


“There is a need for a collaborative approach to Medicaid oversight. State auditors have conducted evaluations that identified significant improper payments and outlined deficiencies in Medicaid processes that require resolution.”

Click here to view the GAO’s complete report.

DHHS Recommendations

Inspector General for Audit Services, Brian P. Ritchie represented DHHS and also weighed-in on the challenges facing Medicaid. The Inspector General identified high improper payments rates, inadequate program integrity safeguards, and beneficiary health and safety concerns as risks that compromise the sustainability of the program. Additionally, he testified that in order to preserve the program there needs to be more robust efforts made in regards to prevention, detection, and enforcement.

According to Ritchie, “CMS must do more to ensure that Medicaid payments are made to the right provider, for the right amount, for the right service, on behalf of the right beneficiary.”

DHHS stressed the importance of complete and reliable national Medicaid data for effective oversight and program management. They determined that the lack of quality data hampers enforcement efforts. DHHS suggested that CMS do the following:

  • “ensure the completeness and reliability of data in the Transformed Medicaid Statistical Information System.”
  • “ensure that States report encounter data for all managed care entities.” 
  • “reduce improper and wasteful payments and ensuring compliance with fiscal controls.”
  • “improve the oversight of Eligibility Determinations”
  • “ensure that national Medicaid data are complete, accurate, and timely.” 
  • “facilitate State Medicaid agencies’ efforts to screen new and existing providers by ensuring the accessibility and quality of Medicare’s enrollment data.”

Read the department’s complete list of recommendations here.

CMS’s Efforts To Address Medicaid’s Improper Payments, Waste, Fraud, And Abuse

Nearly a month after the meeting, the Senate Homeland Security and Governmental Affairs Committee conducted an additional hearing with the Administrator of The Centers for Medicare and Medicaid Services and the US Comptroller General. The hearing focused on examining CMS’s efforts to protect against fraud and overpayments within Medicaid. The GAO expressed that while CMS has taken measures to address these threats, more action is needed in order to strengthen the program’s integrity.

CMS’s Administrator, Seema Verma, testified at the hearing and presented CMS’s efforts. She touched on a number of measures taken such as:

  • New audits of state beneficiary eligibility determinations
  • Targeted audits of state managed care claims for federal match funds and rate setting
  • Addressing the inherited backlog of disallowances
  • Designated State Health Programs (DSHP) funding phase-out
  • Intergovernmental transfers
  • Budget neutrality policies for 1115 Medicaid demonstration projects

In addition, Administrator Verma encouraged the optimization of data. She stressed it’s significance in protecting the integrity of the program. 

According to CMS, “Improving Medicaid and CHIP data and systems is a high priority. Through strong data and systems, CMS and States can drive toward better health outcomes and improve program integrity, performance, and financial management in Medicaid and CHIP.”

CMS is working to improve the Medicaid program’s integrity by implementing advanced analytics and  technologies for the collection of health services data. In June, each of the 50 states, including Washington D.C. and Puerto Rico, started submitting data from their programs to the Transformed – Medicaid Statistical Information System (T-MSIS). The system is designed to monitor key information such as: enhanced information about beneficiary eligibility, beneficiary and provider enrollment, service utilization, claims and managed care data, and expenditure data for Medicaid and CHIP. Moving forward, the agency will be responsible for determining the quality and completeness of the data submitted. 

Click here to read Administrator Verma’s full statement.

The Medicaid program is one of the nation’s largest sources of funding for medical and health-related services.  Due to concerns over the program’s fiscal oversight and it’s significant amount of improper payments, Medicaid has been on the GAO’s “High Risk List” since 2003. As the program continues to grow, government officials and federal agencies are working to address problems rooted in waste, fraud, and abuse in order to protect it’s integrity.