Report Pursuant to Section 182 of Chapter 139 of the Acts of 2012: Assessing MassHealth’s Identification and Recovery of Noncustodial Parents’ Health Insurance
March 1, 2013
For the full report see: Report Pursuant to Section 182 of Chapter 139 of the Acts of 2012: Assessing MassHealth’s Identification and Recovery of Noncustodial Parents’ Health Insurance, March 2013 file size 1MB
At the direction of the Legislature the past two years, the Office of the Inspector General (“Office”) has studied the administration of the Massachusetts Medicaid program (“Medicaid”) by MassHealth, the state entity that runs the program. This year, pursuant to Section 182 of Chapter 139 of the Acts of 2012, the Office examined: (1) how MassHealth gathers and verifies information from custodial parents regarding the availability of commercial health insurance from noncustodial parents; and (2) to what extent MassHealth uses that information to obtain such health insurance coverage for a Medicaid member (referred to as a third party liability or “TPL”). These issues are important to the financial well-being of Medicaid because the program is designed and funded as the payor of last resort, which means that Medicaid is supposed to pay only when another payor is unavailable. And under federal regulations, MassHealth is required to take reasonable measures to identify TPL payors for Medicaid health care services, including commercial health insurance from noncustodial parents of Medicaid members.
The Office studied two scenarios in which MassHealth could access a noncustodial parent’s health insurance. First, MassHealth could discover that a noncustodial parent was already providing health insurance to a Medicaid beneficiary and could then require this insurance to pay the beneficiary’s health care claims. In this scenario, MassHealth’s maximum responsibility would be to provide “secondary coverage” to the beneficiary to pay for deductibles, copays and services not covered by the noncustodial parent’s insurance. The Office determined that MassHealth does have policies and procedures in place for when a Medicaid member is already covered by a noncustodial parent’s existing health insurance.
Second, in the scenario in which MassHealth learns that the member is not covered by a noncustodial parent’s policy, MassHealth could, but currently does not, attempt to obtain or enforce a health insurance support order by referring cases to the Department of Revenue’s Child Support Enforcement Division (“DOR/CSE”), the Commonwealth’s child support enforcement unit. MassHealth’s practice is inconsistent with federal and state regulations. Moreover, MassHealth does not require Medicaid applicants to provide basic noncustodial parent information, such as address, date of birth, Social Security number, and employer. This also violates federal Medicaid regulations, and it prevents MassHealth from gathering information that would enhance its ability to obtain or enforce a health insurance support order from a court, should MassHealth decide to pursue such orders in the future. The Office searched the Medicaid eligibility database and discovered that, at least prior to May 2011, Medicaid applicants did not provide much of the noncustodial parent information requested by MassHealth.[i] In short, when a Medicaid member is not already covered by a noncustodial parent’s health insurance policy, MassHealth does not collect enough information, does not share with DOR/CSE the information it does collect, and does not actively attempt to obtain or enforce health insurance support orders.
MassHealth has, however, made some changes designed to gather more noncustodial parent information. MassHealth is also currently working with DOR/CSE to adopt a set of rules for determining when it is cost-effective for MassHealth to pursue health insurance support orders by referring cases to DOR/CSE. The Office applauds those efforts, but notes that MassHealth has delayed adopting such rules the past few years. MassHealth can help all Medicaid members by following the federal and state rules that are designed to facilitate MassHealth’s identifications and recovery of noncustodial parents’ health insurance. In order to obtain the information needed to identify available health insurance, MassHealth should simplify the language on its application and expand the questions it asks about noncustodial parents and their health insurance. Unless good cause exists not to provide information, MassHealth should also require applicants to answer all of the questions on the application, including supplements, related to noncustodial parents and their health insurance. The Office will follow up and report to the Legislature on MassHealth’s progress in addressing the issues raised in this analysis.