Overview
In accordance with Section 12 of Chapter 11 of the Massachusetts General Laws, the Office of the State Auditor (OSA) has conducted a performance audit of certain activities of Norwood Adult Day Health Center (NADHC) for the period January 1, 2016 through December 31, 2017.
We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.
Below is our audit objective, indicating the question we intended our audit to answer, the conclusion we reached regarding the objective, and where the objective is discussed in the audit findings.
Methodology
We obtained claim data from MassHealth’s Medicaid Management Information System (MMIS) for testing. These data contained information for both fee-for-service claims, which ADH centers bill directly to MassHealth, and encounter claims, which represent services provided by other MassHealth plans such as senior care organization (SCO) and accountable care organization (ACO) plans. To test the reliability of these data, we relied on the work performed by OSA in a separate project that tested certain information system controls in MMIS, which is maintained by the Executive Office of Health and Human Services. As part of the work performed in this separate project, OSA reviewed existing information, tested selected system controls, and interviewed knowledgeable agency officials about the data. Additionally, we performed validity and integrity tests on claim data, including (1) testing for missing data, (2) scanning for duplicate records, (3) testing for values outside a designated range, (4) looking for dates outside specific time periods, and (5) tracing a sample of claims queried to source documents. Based on these procedures, we determined that the data obtained were sufficiently reliable for the purposes of this report.
From discussions with NADHC management, we gained an understanding of internal controls over NADHC’s billing processes for ADH services that we deemed significant to our audit objective.
Effective July 27, 2018, MassHealth revised Section 404 of Title 130 of the Code of Massachusetts Regulations. For the purpose of our audit, we used the regulations that were in effect during the audit period.
Our data showed that NADHC provided ADH services to 150 MassHealth members during the audit period. From this population, we selected a nonstatistical judgmental sample of the 50 members for whom MassHealth paid NADHC the highest amount for services to determine whether NADHC properly billed for the services it provided. We performed the following audit procedures:
- We examined member medical records to determine whether a physician order approving ADH services was included in each sampled member’s records.
- We determined whether each physician order indicated that the member required assistance with specific activities of daily living and/or skilled nursing services.
- We reviewed signed physician orders to determine whether their dates were on or before the members’ first dates of ADH services, because MassHealth does not pay for ADH services before the ADH provider receives a signed physician order.
- We reviewed members’ records to determine whether NADHC obtained clinical authorizations from MassHealth for members enrolled in SCO or ACO plans and whether the authorizations’ dates were on or before the members’ first dates of service.
- We met with the NADHC program director and services coordinator to review the member count obtained from MMIS and ensure that it matched our MMIS-generated list of members who received services at NADHC.
In addition, we selected a nonstatistical judgmental sample of 20 MassHealth members to determine whether each member’s original physician order had been signed by the physician. We sent confirmation letters to the 20 members’ physicians requesting confirmation that they had ordered ADH services for the members.
For both tests that we performed on sampled members, we did not extrapolate the results of our findings to the population of members because our test samples were judgmental samples.
| Date published: | June 6, 2019 |
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