Our office has conducted a performance audit of certain activities of MassHealth for the period January 1, 2018 through September 30, 2021. During the audit period, MassHealth made an estimated $84,832,094 in capitation payments to managed care organizations (MCOs) on behalf of members who were residing in and had enrolled in Medicaid programs in nine other states and Puerto Rico.
- This page, Audit of the Office of Medicaid (MassHealth)—Review of Capitation Payments, is offered by
- Office of the State Auditor
Audit Audit of the Office of Medicaid (MassHealth)—Review of Capitation Payments
|Organization:||Office of the State Auditor|
|Date published:||June 28, 2023|
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 and Medicaid Services, within the United States Department of Health and Human Services (HHS), regulates Medicaid services and works with state governments to administer their Medicaid programs.
In collaboration with the HHS Office of Inspector General’s Boston office, OSA has conducted an audit of capitation payments1 made by MassHealth under its Managed Care Program for the period January 1, 2018 through September 30, 2021. During this period, MassHealth made approximately $2.4 billion in capitation payments to its two contracted managed care organizations (MCOs), which were Tufts Health Together and Boston Medical Center HealthNet Plan.
The purpose of this audit was to determine whether MassHealth ensured that it did not make capitation payments to MCOs on behalf of ineligible members who were residing and receiving benefits in other states or territories. OSA conducted the audit as part of our ongoing independent statutory oversight of the state’s Medicaid program.
Below is a summary of our finding and recommendations, with links to each page listed.
MassHealth made an estimated $84,832,094 in capitation payments on behalf of members who were residing outside of Massachusetts.
1. Medicaid programs make fixed monthly payments to managed care organizations for members enrolled in its Managed Care Program. Each payment is made to MCOs in advance to cover the cost of the anticipated healthcare services of the member, and the amount of each payment is based on the healthcare needs of each member.