Overview
In our review of accountable care organizations’ (ACOs’) budget proposals from the audit period, we found that MassHealth did not always ensure that ACOs submitted their budget proposals for Delivery System Reform Incentive Payment (DSRIP) Program funding before the beginning of the budget period. Late submissions of budget proposals may prevent MassHealth from achieving the goals of the DSRIP Program and from making timely payments to ACOs; it could also affect healthcare services provided to MassHealth members.
In 2020, none of the 17 ACOs that received DSRIP Program funding submitted a budget proposal to MassHealth until after the beginning of the budget period. In 2018, 1 ACO did not submit its budget proposal until after the beginning of the budget period.
Authoritative Guidance
According to Section 3.3 of the Massachusetts Delivery System Reform Incentive Payment (DSRIP) Protocol (Attachment M),
Each ACO . . . will submit a Budget and Budget Narrative to MassHealth for approval for each budget period. ACOs will submit a Budget and Budget Narrative to the State prior to each budget period.
Reasons for Issue
MassHealth lacks specific monitoring activities to ensure that every ACO submits its budget proposal before the beginning of each budget period.
Recommendation
MassHealth should establish monitoring activities to ensure that every ACO submits its budget proposal before the beginning of each budget period.
Auditee’s Response
We presented the draft audit report to MassHealth on April 20, 2022 for its response. MassHealth stated that it disagreed with our finding and provided us with an additional response; we updated the report accordingly and submitted the updated report to MassHealth. Below is its response to the original report.
While MassHealth acknowledges that ACOs did not, in every case, submit budgets to MassHealth prior to the formal start of a given budget period, these cases were consistent with and contemplated by the DSRIP Protocol explicitly. Specifically, the DSRIP Protocol permits MassHealth to “work with ACOs who request additional time or fail to respond in a timely fashion to ensure prompt submission.” (DSRIP Protocol Section 3.4.4.1.) In all cases cited by [the Office of the State Auditor, or OSA], MassHealth did in fact oversee the ACOs’ development and submission of budgets, which were all successfully submitted in accordance with MassHealth directions and revised timelines, and approved. MassHealth therefore disagrees that any additional monitoring activities are needed. In addition, in response to OSA’s statement that a delay in the submission of budgets could impact healthcare services provided to members, MassHealth wishes to clarify that DSRIP payments support activities such as ACO population health management and care coordination, rather than funding covered healthcare services for members.
In its response to the updated report, MassHealth states,
MassHealth further clarifies that any submissions by ACOs following the beginning of the budget period were made in accordance with MassHealth-established deadlines. In all cases cited by OSA, MassHealth did in fact oversee the ACOs’ development and submission of budgets, which were all successfully submitted in accordance with MassHealth directions and revised timelines, and approved. MassHealth therefore disagrees that any additional monitoring activities are needed.
Importantly, OSA acknowledges that it has not identified any discrepancies between approved ACO budgets and MassHealth payment disbursements. . . . The OSA’s findings are based solely on matters of timing of approvals, with which MassHealth reiterates its strong disagreement, for the reasons set forth above and in MassHealth’s original response.
Auditor’s Reply
MassHealth states that the DSRIP Protocol permits it to “work with ACOs who request additional time or fail to respond in a timely fashion to ensure prompt submission.” Although we do not dispute this fact, MassHealth did not provide us with any documentation to substantiate that any of the ACOs that had failed to submit their budgets within the prescribed timeframe had requested MassHealth’s assistance. We believe that a proper monitoring process would involve determining which ACOs will need budgeting assistance before the beginning of the budgeting process, working with them so that their budget requests can be submitted within the prescribed timeline, and documenting the process. MassHealth did not give us any documentation of the measures it took to help ACOs with their budgeting activities, but any measures it took do not appear to have been very effective, because as noted above, in 2020 none of the 17 ACOs that received DSRIP Program funding submitted a budget proposal to MassHealth until after the beginning of the budget period. Therefore, we urge MassHealth to implement our recommendation of establishing monitoring activities to ensure that every ACO submits its budget proposal before the beginning of each budget period.
This report does not state that DSRIP Program payments directly fund healthcare services. Rather, it states that any issues with the funding of health management and care coordination could affect the healthcare that MassHealth members receive.
| Date published: | June 29, 2022 |
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