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Audit Audit of the Office of Medicaid (MassHealth)—Review of Accounts Receivable

The audit found MassHealth did not have policies, procedures, or monitoring controls to determine when to write off accounts that are uncollectible. The audit examined the period of January 1, 2015 through December 31, 2017.

Organization: Office of the State Auditor
Date published: October 18, 2019

Executive Summary

The Office of the State Auditor (OSA) receives an annual appropriation for the operation of a Medicaid Audit Unit to help prevent and identify fraud, waste, and abuse in the Commonwealth’s Medicaid program. This program, known as MassHealth, is administered under Chapter 118E of the Massachusetts General Laws by the Executive Office of Health and Human Services, through the Division of Medical Assistance. Medicaid is a joint federal-state program created by Congress in 1965 as Title XIX of the Social Security Act. At the federal level, the Centers for Medicare & Medicaid Services, within the US Department of Health and Human Services, administer the Medicare program and work with state governments to administer state Medicaid programs.

OSA has conducted an audit of MassHealth’s accounts receivable from providers1 for the period January 1, 2015 through December 31, 2017. The purpose of this audit was to determine whether MassHealth effectively manages its accounts receivable with regard to write-offs of uncollectible accounts receivable. The audit was conducted as part of OSA’s ongoing independent statutory oversight of the state’s Medicaid program.

Below is a summary of our finding and recommendation, with links to each page listed.

Finding 1

MassHealth does not effectively administer its uncollectible accounts receivable balances.


MassHealth should develop policies and procedures regarding how it will determine when to write off accounts receivable that it has deemed uncollectible, as well as monitoring controls to ensure that these policies and procedures are adhered to.


1.    Accounts receivable can result from various activities, such as general overpayments because of human error, retroactive decreases in payment rates, Medicare payments that offset some of the costs billed to MassHealth, and payments made to service providers that have been questioned because of audits.


A PDF copy of the audit of the Office of Medicaid (MassHealth) - Review of Accounts Receivable is available here.