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MassHealth Provider Integrity

This is part of the MassHealth Provider Handbook.

Table of Contents

Compliance Auditing and Monitoring

A compliance audit is a comprehensive review of a provider’s adherence to regulatory guidelines whose aim is to eliminate fraud, waste and abuse from government programs. See 42 U.S.C. 1396a(a)(27). The audit may include, but not be limited to, a review of paid claims, third party liability, staffing levels, employee requirements, a review of a provider’s financial records, and other records such, as prior authorizations, invoices, and cost reports. The audit may also include an examination of the medical necessity of services provided to MassHealth members. Additionally, provider’s claims are subject to regular monitoring by MassHealth that may result in periodic audits.

Pursuant to MassHealth regulations 130 CMR 450.204: Medical Necessity, MassHealth does not pay for services that are not medically necessary and may impose sanctions on providers for providing or prescribing a service or for admitting a member to an inpatient facility where such service or admission is not medically necessary.

Data on a laptop
Photo: Carlos Muza, Unsplash

Pursuant to 130 CMR 450.205: Recordkeeping and Disclosure, MassHealth will not pay a provider for services if the provider does not have adequate documentation to substantiate the provision of services payable under MassHealth. All providers must keep such records, including medical records as are necessary to disclose fully the extent and medical necessity of services provided to, or prescribed for, members and must provide to MassHealth and the Attorney General’s Medicaid Fraud Division, the state Auditor and the United States Department of Health and Human Services on request such information and any other information about payments claimed by the provider for providing services or otherwise described in 130 CMR 450.205. See 42 U.S.C. 1396a(a)(27). All providers must also disclose such records and information to any other state and federal agency to which disclosure is required by law.

Providers can review recommendations for implementing effective compliance programs via the Office of the Inspector General’s website.

Provider Self-Disclosures

The Affordable Care Act of 2010 (ACA) imposes federal requirements on MassHealth providers to timely report and return overpayments received from MassHealth. Providers must report in writing and return any overpayments within 60 days of

  1. the provider identifying such overpayment, or
  2. for payments subject to reconciliation based on a cost report, the date any corresponding cost report is due. Providers who fail to disclose, explain, and return overpayments in a timely manner may be subject to sanctions, including administrative fines and suspension or termination from the MassHealth program.

Providers can find more information defining overpayments at 130 CMR 450.235.

Predictive Modeling

Data set

In 2013, MassHealth implemented a pre-payment screening process using the Predictive Modeling System. This system detects potential improper payments through predictive modeling, comprehensive data analytics, and other statistical methods. The Predictive Modeling System is fully integrated into the Medicaid Management Information System (MMIS) and employs sophisticated algorithms and models to identify improper billing of claims and detect emerging trends and behavioral patterns of improper billing activity. This system enables MassHealth to review claims for regulatory noncompliance on a pre-payment basis. For more information, please refer to All Provider Bulletin 234.

MassHealth routinely performs reviews of providers who participate in MassHealth. These reviews assure compliance with the regulations governing MassHealth, and help to determine whether the services provided were medically necessary, appropriate, and of a quality that meets professionally recognized standards of care. These reviews are required by federal law at 42 U.S.C. 1396a(a) (27), (30), and by Massachusetts General Laws at Chapter 118E, as well as by Code of Massachusetts Regulations at 130 CMR 450.204, 205, and 206.

Provider Exclusions/Suspensions

The Office of Inspector General (OIG) has the authority, as well as MassHealth, to exclude individuals and entities from federally funded health care programs for a variety of reasons, including a conviction for Medicare or Medicaid fraud.

Those that are excluded can receive no payment from federal or state healthcare programs for any items or services they furnish, order, or prescribe. The OIG maintains a list of all currently excluded individuals and entities called the List of Excluded Individual/Entities” (LEIE) Anyone who hires an individual or entity on the LEIE may be subject to civil monetary penalties. To avoid civil monetary penalties, healthcare entities should routinely check the list to ensure that new hires and current employees are not on it.

MassHealth maintains a list of providers who have been suspended or excluded from participating in the MassHealth program. This list is updated monthly and reflects suspensions or exclusions effective on or after March 23, 2010.

Attorney General’s Medicaid Fraud Division

The Medicaid Fraud Division investigates and prosecutes health care providers who defraud MassHealth. In addition, the Medicaid Fraud Division is responsible for reviewing complaints of abuse, neglect, mistreatment, and financial exploitation of patients in long-term care facilities. Learn more on the Medicaid Fraud Division web page.

Attorney General’s Medicaid Fraud tip line

(617) 963-2360; (617) 573-5369 (fax).

Learn how to file a complaint.

Date published: July 29, 2022

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