Audit: Ohio Medicaid improperly paid $118.5M for prisoners, dead people

Ohio Medicaid overpaid managed care organizations more than $118.5 million in duplicate payments and for the managed care of prison inmates and deceased residents, according to a report released Thursday by the Auditor of State.

The audit recommends Ohio Medicaid recoup the money from the managed care organizations and refund the federal share.

“While $118.5 million might be a drop in the bucket for the Department of Medicaid, for Ohioans that is a lot of money — taxpayer money — that needs to be accounted for,” Auditor of State Keith Faber said.

“That’s enough money to cover 1.8 million doctor’s office visits, 2.4 million prenatal appointments for expecting moms, 1.6 million mammograms, 1.3 million pairs of prescription glasses, 148,000 sets of dentures, 1.3 million drug addiction counseling sessions or 1.3 million hours of in-home nursing care — the kinds of services eligible residents need and Medicaid provides.”

The audit does not identify the managed care organization by name.

The review was launched following reports in 2019 from the U.S. Department of Health and Human Services Office of Inspector General that Ohio Medicaid had paid tens of millions of dollars for residents who were dead.

State auditors looked at capitation payments over a three year period from July 2017 through June 2020. Capitation payments are monthly payments to managed care organizations based on the number of people enrolled that the organizations use to cover medical services.

The audit found:

  • $101 million in payments for 29,412 adults incarcerated in Ohio Department of Rehabilitation and Correction facilities and not eligible for Medicaid.
  • $3.4 million paid on behalf of residents after they died.
  • $29 million in duplicate payments for residents who had multiple identification numbers in the state’s system. Auditors estimate about half of that should have been recouped.

They are still looking into another $84 million that auditors identified as potentially erroneous payments.

Ohio Medicaid officials responded to the audit saying they are aware of problems and working to fix them. Many of the improper payments identified by the auditor were driven by defects and design issues in Ohio Medicaid’s eligibility system, Ohio Benefits, they said.

“ODM has undertaken extraordinary efforts to improve Ohio Benefits since January 2019, the midpoint of the audit period,” wrote Ohio Medicaid Director Maureen Corcoran in an agency response to the audit.

Ohio Gov. Mike DeWine appointed Corcoran to lead the agency in January 2019.

In their response, Ohio Medicaid officials did not commit to recouping the funds but said they would have to review the recommendation and what impact it may have on capitation payment rates.

“While ODM is working to address many of the issues auditors identified in this report, there is much more to be done across state agencies to help ensure that each department works together to close loopholes in Ohio’s systems that cost taxpayers millions of dollars each year,” Faber said.

Ohio Medicaid provides health coverage for about 2.9 million residents. The agency’s annual $28 billion budget accounts for more than one-third of the state’s overall budget.

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