Syrtis Solutions publishes a monthly Medicaid news summary to help healthcare leaders stay informed. Each edition highlights key developments, research, and legislation related to Medicaid program integrity, cost avoidance, coordination of benefits, improper payments, and fraud, waste, and abuse. Below is a recap of last month’s Medicaid news.
MEDICAID COST AVOIDANCE: FINDING SAVINGS BEFORE CLAIMS ARE PAID Syrtis Solutions, September 30
Cost avoidance is becoming a priority for Medicaid health plans facing pressure to control spending, improve payment accuracy, and protect limited healthcare dollars. With tighter budgets, federal requirements, and increased scrutiny of program integrity, plans need measurable savings that don’t reduce benefits or disrupt member care. That pressure is putting new attention on payment integrity. Moving Beyond “Pay and Chase” A September 2026 majority staff report from the House Committee on Energy and Commerce examined fraud and program integrity across Medicare and Medicaid. read more
Cost avoidance is becoming a priority for Medicaid health plans facing pressure to control spending, improve payment accuracy, and protect limited healthcare dollars. With tighter budgets, federal requirements, and increased scrutiny of program integrity, plans need measurable savings that don’t reduce benefits or disrupt member care. That pressure is putting new attention on payment integrity. Moving Beyond “Pay and Chase” A September 2026 majority staff report from the House Committee on Energy and Commerce examined fraud and program integrity across Medicare and Medicaid. read more
Tracking Implementation of the 2025 Reconciliation Law: Medicaid Work Requirements
KFF, September 29
The 2025 reconciliation law, once called the “One Big Beautiful Bill,” signed by President Trump on July 4, 2025, requires 44 states (including DC) to condition Medicaid eligibility for adults in the Affordable Care Act (ACA) Medicaid expansion group and certain enrollees in 1115 waiver programs on meeting work requirements starting January 1, 2027. Currently, 41 states (including DC) have expanded their Medicaid programs under the ACA to nearly all adults with income up to 138% FPL ($21,597 for an individual in 2025). In June 2026, CMS released a list of states with 1115 waiver programs that include individuals who will be subject to work requirements. read more
KFF, September 29
The 2025 reconciliation law, once called the “One Big Beautiful Bill,” signed by President Trump on July 4, 2025, requires 44 states (including DC) to condition Medicaid eligibility for adults in the Affordable Care Act (ACA) Medicaid expansion group and certain enrollees in 1115 waiver programs on meeting work requirements starting January 1, 2027. Currently, 41 states (including DC) have expanded their Medicaid programs under the ACA to nearly all adults with income up to 138% FPL ($21,597 for an individual in 2025). In June 2026, CMS released a list of states with 1115 waiver programs that include individuals who will be subject to work requirements. read more
CMS Refocuses Medicaid Quality on Health Outcomes, Launches Innovative Partnership With 37 States
CMS.gov, September 25
The Centers for Medicare & Medicaid Services (CMS) is launching an initiative with a founding group of 37 state partners to focus on how quality is measured in Medicaid and the Children’s Health Insurance Program (CHIP). The effort will put health outcomes — not processes and paperwork — at the center of how success is defined. CMS and its partners will prioritize measures that demonstrate meaningful improvements in prevention, chronic disease management, and behavioral health.“For too long, Medicaid has measured whether boxes are checked instead of whether patients are getting healthier — that must change,” said CMS Administrator Dr. Mehmet Oz. read more
CMS.gov, September 25
The Centers for Medicare & Medicaid Services (CMS) is launching an initiative with a founding group of 37 state partners to focus on how quality is measured in Medicaid and the Children’s Health Insurance Program (CHIP). The effort will put health outcomes — not processes and paperwork — at the center of how success is defined. CMS and its partners will prioritize measures that demonstrate meaningful improvements in prevention, chronic disease management, and behavioral health.“For too long, Medicaid has measured whether boxes are checked instead of whether patients are getting healthier — that must change,” said CMS Administrator Dr. Mehmet Oz. read more
Medicaid Managed Care: CMS’s Accuracy Check Process For State-Submitted Medical Loss Ratio Data Has Limitations
OIG.HHS.gov, September 24
Why OIG Did This Review: Medical loss ratios (MLRs) are an important part of Medicaid managed care fiscal oversight. An MLR shows whether a managed care plan spent most of its Medicaid funds on medical costs. Specifically, an 85-percent MLR—the Federal standard—means that a plan spent 85 percent on patient care and quality improvements and 15 percent on administration and profit. States must develop their managed care plans’ fixed monthly payment rates (hereafter “capitation rates”) so that they will reasonably achieve at least 85-percent MLRs. read more
OIG.HHS.gov, September 24
Why OIG Did This Review: Medical loss ratios (MLRs) are an important part of Medicaid managed care fiscal oversight. An MLR shows whether a managed care plan spent most of its Medicaid funds on medical costs. Specifically, an 85-percent MLR—the Federal standard—means that a plan spent 85 percent on patient care and quality improvements and 15 percent on administration and profit. States must develop their managed care plans’ fixed monthly payment rates (hereafter “capitation rates”) so that they will reasonably achieve at least 85-percent MLRs. read more
New Jersey Strengthens Oversight of Medicaid Home Care Services to Protect Program Integrity
New Jersey Human Services, September 24
New Jersey Human Services has announced strengthened oversight requirements for Medicaid-funded Personal Care Assistance and Home Health Services, reinforcing the State’s commitment to program integrity and responsible stewardship of taxpayer dollars. Beginning January 1, healthcare providers serving NJ FamilyCare members through Managed Care will be required to meet updated Electronic Visit Verification (EVV) standards. These requirements ensure that providers accurately verify and document services and that Medicaid payments cover only services that providers actually deliver. read more
New Jersey Human Services, September 24
New Jersey Human Services has announced strengthened oversight requirements for Medicaid-funded Personal Care Assistance and Home Health Services, reinforcing the State’s commitment to program integrity and responsible stewardship of taxpayer dollars. Beginning January 1, healthcare providers serving NJ FamilyCare members through Managed Care will be required to meet updated Electronic Visit Verification (EVV) standards. These requirements ensure that providers accurately verify and document services and that Medicaid payments cover only services that providers actually deliver. read more
New York Made Unallowable Managed Care Capitation Payments on Behalf of Incarcerated Medicaid Enrollees
OIG.HHS.gov, September 23
Why OIG Did This Audit: New York pays managed care organizations to make services available to eligible Medicaid enrollees in return for a monthly fixed payment (capitation payment) for each enrollee. Previous audits found that State Medicaid agencies made unallowable capitation payments on behalf of incarcerated Medicaid enrollees. We conducted this audit to determine whether New York made unallowable capitation payments on behalf of incarcerated Medicaid enrollees and to identify the dollar amount of any unallowable capitation payments that were not recovered. read more
OIG.HHS.gov, September 23
Why OIG Did This Audit: New York pays managed care organizations to make services available to eligible Medicaid enrollees in return for a monthly fixed payment (capitation payment) for each enrollee. Previous audits found that State Medicaid agencies made unallowable capitation payments on behalf of incarcerated Medicaid enrollees. We conducted this audit to determine whether New York made unallowable capitation payments on behalf of incarcerated Medicaid enrollees and to identify the dollar amount of any unallowable capitation payments that were not recovered. read more
Strategies for Managing Underperforming Medicaid Plans
The Commonwealth Fund, September 23
With three out of four Medicaid enrollees nationwide receiving most or all covered services from comprehensive managed care plans,1 the oversight of Medicaid managed care entity (MCE)2 performance is among the most important roles of a state Medicaid agency. The Medicaid Managed Care Oversight Toolkit3 is one resource designed to assist state agencies with implementing a comprehensive oversight approach and ensuring that MCEs are meeting their contractual obligations. Despite strong managed care contracts, Medicaid plans may still perform poorly — whether financially, in the provision of quality care, or in members’ access to covered services. read more
The Commonwealth Fund, September 23
With three out of four Medicaid enrollees nationwide receiving most or all covered services from comprehensive managed care plans,1 the oversight of Medicaid managed care entity (MCE)2 performance is among the most important roles of a state Medicaid agency. The Medicaid Managed Care Oversight Toolkit3 is one resource designed to assist state agencies with implementing a comprehensive oversight approach and ensuring that MCEs are meeting their contractual obligations. Despite strong managed care contracts, Medicaid plans may still perform poorly — whether financially, in the provision of quality care, or in members’ access to covered services. read more
CMS Announces Participants in Landmark Medicaid Drug Payment Model to Bring Down Drug Costs for Most Vulnerable Americans CMS.gov, September 18
The Centers for Medicare & Medicaid Services (CMS) is working to end skyrocketing drug costs as the agency announces today that all 50 states, plus the District of Columbia and Puerto Rico, have applied to participate in an initiative which provides most-favored-nation pricing for certain prescription drugs to people with Medicaid. Forty states and Puerto Rico have already signed agreements to participate in this historic program that will lower Medicaid drug costs to what other countries pay, saving an estimated $64.3 billion in taxpayer dollars over the next ten years, while preserving or enhancing beneficiaries’ quality of care. read more
The Centers for Medicare & Medicaid Services (CMS) is working to end skyrocketing drug costs as the agency announces today that all 50 states, plus the District of Columbia and Puerto Rico, have applied to participate in an initiative which provides most-favored-nation pricing for certain prescription drugs to people with Medicaid. Forty states and Puerto Rico have already signed agreements to participate in this historic program that will lower Medicaid drug costs to what other countries pay, saving an estimated $64.3 billion in taxpayer dollars over the next ten years, while preserving or enhancing beneficiaries’ quality of care. read more
Medicaid: Improved Oversight Needed of State Eligibility Error Corrective Action Plans GAO, September 17
States are responsible for determining if a person is eligible for Medicaid. The Centers for Medicare & Medicaid Services oversees the accuracy of these decisions. But determining eligibility is a complex process and vulnerable to errors. States submit corrective action plans for addressing errors to CMS for review. CMS provides feedback and oversight of states’ plans, but has accepted plans that are missing required information. CMS also doesn’t comprehensively review the plans across states and years to identify widespread issues. read more
States are responsible for determining if a person is eligible for Medicaid. The Centers for Medicare & Medicaid Services oversees the accuracy of these decisions. But determining eligibility is a complex process and vulnerable to errors. States submit corrective action plans for addressing errors to CMS for review. CMS provides feedback and oversight of states’ plans, but has accepted plans that are missing required information. CMS also doesn’t comprehensively review the plans across states and years to identify widespread issues. read more
Audit: To Preserve Federal Funding, OHA Must Do More to Prevent Duplicate Medicaid IDs
GOVDelivery.com. September 16
Duplicate IDs within the Oregon Health Plan can lead to overpayments to Coordinated Care Organizations, which, if not addressed, can risk a reduction or withholding of federal funding for this critical program, auditors found. In an audit released today, Oregon Secretary of State auditors report that between 2020 and 2024 they identified 645 potential duplicate system IDs out of more than 2 million reviewed, and associated overpayments of up to an estimated $4.1 million. In that same time frame, the state paid $37 billion in payments to Coordinated Care Organizations. read more
GOVDelivery.com. September 16
Duplicate IDs within the Oregon Health Plan can lead to overpayments to Coordinated Care Organizations, which, if not addressed, can risk a reduction or withholding of federal funding for this critical program, auditors found. In an audit released today, Oregon Secretary of State auditors report that between 2020 and 2024 they identified 645 potential duplicate system IDs out of more than 2 million reviewed, and associated overpayments of up to an estimated $4.1 million. In that same time frame, the state paid $37 billion in payments to Coordinated Care Organizations. read more
Credit Balance Audits Update
NCDHHS, September 15
NC Medicaid has contracted with Health Management Systems (HMS) to conduct Overpayment Recovery Reviews for Medicaid beneficiaries enrolled in NC Medicaid Direct. Pursuant to Section 1866 of the Social Security Act, 42 U.S.C. § 1395cc, providers are required to make adequate provision for the refund of any amounts improperly collected from an individual or other person. NC Medicaid’s objective is to identify and recover overpayments determined to be refundable to the Medicaid program. Definition of a Medicaid Overpayment: A Medicaid overpayment is a payment a provider receives in excess of the amounts properly payable under Medicaid statutes and regulations.
read more
NCDHHS, September 15
NC Medicaid has contracted with Health Management Systems (HMS) to conduct Overpayment Recovery Reviews for Medicaid beneficiaries enrolled in NC Medicaid Direct. Pursuant to Section 1866 of the Social Security Act, 42 U.S.C. § 1395cc, providers are required to make adequate provision for the refund of any amounts improperly collected from an individual or other person. NC Medicaid’s objective is to identify and recover overpayments determined to be refundable to the Medicaid program. Definition of a Medicaid Overpayment: A Medicaid overpayment is a payment a provider receives in excess of the amounts properly payable under Medicaid statutes and regulations.
read more
California Did Not Report and Return All Medicaid Overpayments for the State’s Medicaid Fraud Control Unit Cases
OIG, September 9
Why OIG Did This Audit: This audit, one of a series examining whether States had recovered and returned the correct Federal share of improper provider claim amounts, focused on whether California reported and returned the correct Federal share of overpayments identified by its Medicaid Fraud Control Unit (MFCU) during Federal fiscal year 2023. What OIG Found: We determined that California should have reported MFCU-determined Medicaid overpayments totaling $231.2 million ($99.3 million Federal share) for 26 cases during the audit period. read more
OIG, September 9
Why OIG Did This Audit: This audit, one of a series examining whether States had recovered and returned the correct Federal share of improper provider claim amounts, focused on whether California reported and returned the correct Federal share of overpayments identified by its Medicaid Fraud Control Unit (MFCU) during Federal fiscal year 2023. What OIG Found: We determined that California should have reported MFCU-determined Medicaid overpayments totaling $231.2 million ($99.3 million Federal share) for 26 cases during the audit period. read more
