Overview
During this reporting period, the Office of the State Auditor (OSA) released nine audit reports on MassHealth’s administration of the Medicaid program and on Medicaid service providers’ compliance with state and federal laws, regulations, and other authoritative guidance. These reports identified millions of dollars in questionable, unallowable, unauthorized, and potentially fraudulent payments and made a number of recommendations to strengthen internal controls and oversight in MassHealth’s program administration. The following is a summary of our Medicaid audit work.
Office of Medicaid (MassHealth)—Review of Fee-for-Service Payments for Services Covered by MBHP
OSA conducted an audit of MassHealth’s activities to determine whether MassHealth disallowed fee-for-service (FFS) claims for services that should have been covered by the Massachusetts Behavioral Health Partnership (MBHP) in accordance with its contract with the Executive Office of Health and Human Services (EOHHS) as well as applicable regulations and other requirements for the period July 1, 2010 through June 30, 2015. MBHP is responsible for providing behavioral-health and substance-use treatment services for MassHealth members enrolled in its Primary Care Clinician Plan and members enrolled with other MassHealth managed-care organizations that contract with MBHP for these services. This audit focused on reviewing operating policies and procedures and control activities, including system edits, to ensure that MassHealth did not pay twice for a member’s behavioral-health services. This could occur if MassHealth paid the monthly fee (capitation payment) to MBHP to provide behavioral-health services and then paid a provider directly via an FFS payment.
Our audit found that MassHealth paid providers $192,600,577 for improper or questionable FFS claims for services that were already covered by the MBHP contract. These improper payments comprised $92,021,777 for services that were not properly identified by MassHealth’s Medicaid Management Information System (MMIS) as covered by MBHP, $896,786 for services that were covered by the MBHP contract but paid as FFS, and $99,682,014 for behavioral-health services that should have been covered by the MBHP contract.
As a result of these findings, OSA recommended that MassHealth (1) establish recoupment efforts for the questioned improper payments, (2) develop a more explicit master list of covered behavioral-health services, and (3) design system edits to prevent and deny FFS payments for these covered services.
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Office of Medicaid (MassHealth)—Review of Claims for Durable Medical Equipment
OSA conducted an audit of paid claims for durable medical equipment (DME) for the period July 1, 2010 through December 31, 2015. MassHealth covers medically necessary DME for its members, including wheelchairs, traction equipment, canes, crutches, walkers, kidney machines, ventilators, monitors, pressure mattresses, lifts, and nebulizers. The purpose of this audit was to determine whether MassHealth paid for DME based on state regulations and the schedule of published rates established by the Center for Healthcare Information and Analysis (CHIA).
Our audit showed that MassHealth did not pay DME providers in accordance with the CHIA rate schedule; this resulted in overpayments of $57,067. Additionally, our audit identified 2,931 claims, totaling $148,978, in duplicate payments for the same equipment provided to the same member. This type of duplicate payment would occur when a DME provider submitted a claim for equipment to Medicare, which covered the equipment, and was paid by MassHealth for a separate claim for the same item. Our audit report recommended that MassHealth recover all overpayments, ensure that its claim-processing system was promptly updated with DME rate changes sponsored by CHIA, and develop system edits to ensure that providers that submit duplicate Medicare and Medicaid claims received payment for only the portion of the Medicare claim that was not paid by Medicare.
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Office of Medicaid (MassHealth)—Review of Payments for Nursing-Facility Claims
OSA conducted an audit of MassHealth’s payment of claims submitted by nursing facilities for the period January 1, 2010 through June 30, 2015. The purpose of this audit was to determine whether MassHealth properly paid nursing facilities for room and board provided to its members. MassHealth pays nursing facilities based on their applicable rates2 for each member’s level of care and the number of days the member stayed in the facility. MassHealth’s Office of Long-Term Services and Supports is tasked with performing semiannual audits, referred to as Management Minute Questionnaire (MMQ) audits, at each nursing facility to review each resident’s level of care through detailed reviews of his/her medical records. Adjustments are made to each member’s level of care accordingly, which affects the per diem payment rate.
Our audit found that 34,572 nursing facility payments required adjustment based on MMQ audits during the audit period, but MassHealth did not recoup the overpayments it made. This resulted in $639,445 in unrecouped overpayments. Additionally, we found that MassHealth’s contractor did not update members’ levels of care based on MMQ audit results in a timely manner; this resulted in overpayments of $326,201.
As part of this audit, we identified two other issues. First, MassHealth did not adjust detailed claim information in its claim-processing system (MMIS) for amounts it had already recouped. This affected over $3 million in payments for nursing-facility per diem services. Second, we identified a weakness in user access controls in MMIS: MassHealth personnel and contracted personnel could update records that affected members’ levels of care and nursing facilities’ per diem rates even though no properly authorized EOHHS access request forms had been signed and approved by their managers.
Our report recommended that MassHealth recover all identified overpayments from nursing facilities, create system edits to adjust all nursing-facility claim submissions for members whose levels of care were adjusted because of MMQ audits, develop policies and procedures to validate that it promptly updated members’ levels of care in MMIS, ensure that all nursing-facility recoupments were properly reflected in the MMIS detailed claim data, and require managers to follow its protocols when requesting access to MMIS functions for staff and contractors.
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Review of Evaluation & Management Claims Paid to Resil Medical Associates, P.C.
OSA conducted an audit of evaluation and management (E/M) services paid to Resil Medical Associates, P.C. (RMA) for the period July 1, 2010 through December 31, 2015. During this period, the medical practice was paid approximately $512,000 to provide E/M services for 866 MassHealth members. The purpose of this audit was to determine whether the practice billed MassHealth for E/M services that were medically necessary, supported by appropriate documentation, and in accordance with certain state regulations.
We tested a statistically random sample of 67 out of 4,516 E/M claims paid to RMA. Because the sample was statistical, we were able to project the potential error to the population. Of these 67 claims, we identified 23 as claims for services that were performed by independent nurse practitioners (NPs) and non-independent NPs. Instead of billing for these services using the required modifier codes, RMA billed for them as if they had been performed by a physician. Services provided by independent and non-independent NPs are paid at lower rates than those provided by physicians. We projected these results to the population of all E/M claims using a 90% confidence level and a 10% margin of error. The result was a projected overpayment of $17,3463 for the audit period.
While testing the statistical sample of 67 E/M claims, we found three other problems and expanded our testing to determine their impact. First, for 2 of the 67 sampled claims, RMA did not use properly licensed staff members to perform complex E/M services. Because MassHealth members’ health could be at risk, we expanded our testing of E/M claims and found that staff members who were certified as registered nurses (RNs) had performed high-complexity E/M services, totaling $2,467, even though RNs are only certified to perform low-complexity E/M services.
Additionally, using paid claims, RMA’s patient appointment schedules, staff locator sheets and hours worked, and medical records, we found that Dr. Resil did not always provide supervision for his RNs and non-independent NPs as required by MassHealth’s regulations. Also, Dr. Resil and his NPs (independent and non-independent) did not document the required collaborative arrangements and prescriptive-practice guidelines to ensure that NPs practiced within the scope of their licenses. Both of these problems could jeopardize RMA patients’ safety.
To resolve these problems, our audit report recommended that RMA, among other things, (1) collaborate with MassHealth to repay the approximately $19,813 identified in improper payments, (2) cease having RNs perform high-complexity E/M services, (3) work with MassHealth to identify all instances in which RNs performed high-complexity services, (4) adjust its website and billing system to ensure that its patients were aware of the certifications of its employees and that the employees’ services were properly billed at the correct rates, (5) establish the required collaborative arrangements that detailed medical services and prescriptive practices each staff member could perform, and (6) ensure that Dr. Resil was present to provide appropriate supervision of all services provided by his non-independent NPs.
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Review of Evaluation and Management Claims Paid to Lawrence Family Doctors
OSA conducted an audit of E/M services paid to Lawrence Family Doctors (LFD), owned by Dr. Joel Gorn, for the period January 1, 2010 through June, 30 2016. During this period, the medical practice was paid approximately $1,223,444 to provide E/M services for 1,763 MassHealth members. The purpose of this audit was to determine whether the practice billed MassHealth for E/M services provided to members by its NPs in accordance with certain state regulations.
We tested a statistically random sample of 179 out of 13,391 paid E/M claims from the audit period, using an expected error rate of 50%, a desired precision of 15%, and a confidence level of 95%, to determine whether LFD properly billed MassHealth for these services. Because the sample was statistical, we were able to project the potential error to the population. Of these 179 claims, 125 (70%) were identified as claims for services that were performed by Dr. Gorn’s NPs. Instead of billing for these services using the required modifier, LDF billed for them as if they had been performed by Dr. Gorn. Services provided by NPs are paid at lower rates than those provided by physicians. We projected these results to the population of all E/M claims using a 95% confidence level and a 15% margin of error. The result was a projected overpayment of $108,232 for the audit period.
While testing the statistical sample of 179 E/M claims, we found that, for 11 claims, the medical records did not contain documentation of the nature, extent, and medical necessity of services provided to members. Additionally, these medical records were missing components required for E/M claims, including documentation of examinations, medical histories, and/or descriptions of chief complaints, to justify using the codes billed. Also, for another 16 of the 179 tested claims, LFD could not provide the medical records to validate the nature, extent, and medical necessity of care provided to the members
To resolve these problems, our audit report recommended that LFD, among other things, (1) collaborate with MassHealth to repay the approximately $108,232 identified in improper payments, (2) ensure that services performed by NPs were billed properly using the required modifier, and (3) ensure that it maintained necessary documentation to support the nature, extent, and medical necessity of care provided to members, including documentation of examinations, medical histories, and chief complaints.
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Review of Hospice Care Billing: HopeHealth Massachusetts, Inc.
OSA conducted an audit of hospice claims paid to HopeHealth Massachusetts, Inc. for the period July 1, 2011 through June 30, 2016. During this period, MassHealth paid HopeHealth approximately $17,483,302 to provide hospice care to 611 MassHealth members. The purpose of this audit was to determine whether HopeHealth billed MassHealth for appropriate hospice care, including routine home care, general inpatient care, and long-term room and board, and whether it documented these services in member medical records in accordance with certain applicable MassHealth regulations.
We tested a nonstatistical sample of 30 out of 611 members who received services from HopeHealth during the audit period. Additionally, we selected a judgmental sample of 28 members based on two isolated risk factors: whether they had been in hospice care for more than two years and whether MassHealth paid for hospice care after the dates of death recorded in MMIS.
Our audit found that HopeHealth did not maintain properly completed required documentation for hospice care and that some member files contained inaccurate information. For 27 out of the 58 sampled members, HopeHealth did not maintain properly completed Certification of Terminal Illness (CTI) Forms or Hospice Election Forms. Additionally, 7 of the 58 tested member medical records contained inappropriate or conflicting documentation: 5 member files included medical forms and other documentation belonging to other HopeHealth patients, 1 member file was missing the Discharge Summary Form, and 1 member file had two Discharge Summary Forms stating conflicting reasons for discharge (one indicated “death” and the other “no longer eligible for hospice services”). We questioned a total of $2,171,683 of hospice claims paid by MassHealth because member records did not have the required CTI Forms or Hospice Election Forms.
To resolve this problem, our audit report recommended that HopeHealth take the necessary measures to ensure that all required forms (CTI Forms, Hospice Election Forms, and Discharge Summary Forms) were complete, accurate, and compliant with MassHealth regulations, as well as taking measures to avoid commingling patients’ information in medical files.
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Review of Hospice Care Billing: Good Shepherd Community Care
OSA conducted an audit of hospice claims paid to Good Shepherd Community Care for the period July 1, 2011 through June 30, 2016. During this period, MassHealth paid Good Shepherd approximately $5,992,563 to provide hospice care to 376 MassHealth members. The purpose of this audit was to determine whether Good Shepherd billed MassHealth for appropriate hospice care, including routine home care, general inpatient care, and long-term room and board, and whether it documented these services in member medical records in accordance with certain applicable MassHealth regulations.
We tested a nonstatistical sample of 30 out of 376 members who received services from Good Shepherd during the audit period. Additionally, we selected a judgmental sample of 4 members based on two isolated risk factors: whether they had been in hospice care for more than two years and whether MassHealth paid for hospice care after their dates of death.
Our audit found that Good Shepherd did not maintain properly completed required documentation for hospice care. For 17 out of 34 members’ medical records tested, Good Shepherd did not maintain properly completed CTI Forms or Hospice Election Forms. We questioned a total of $866,234 of hospice claims paid by MassHealth because member records did not have the required CTI Forms or Hospice Election Forms.
To resolve this problem, our audit report recommended that Good Shepherd take the measures necessary to ensure that all required forms (CTI Forms and Hospice Election Forms) were complete, accurate, and compliant with MassHealth regulations.
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Review of Evaluation and Management Claims Submitted by Dr. Hooshang Poor
OSA conducted an audit of E/M claims paid to Dr. Hooshang Poor for the period January 1, 2012 through September 30, 2015. We expanded our audit period for certain issues back through May 1, 2010 and forward through October 31, 2016. During this period, MassHealth paid Dr. Poor approximately $746,322 to provide E/M services for 977 MassHealth members residing in nursing facilities and rest homes. The purpose of this audit was to determine whether Dr. Poor billed MassHealth for E/M services using appropriate procedure codes and modifier codes, met recordkeeping requirements, and provided supervision of NPs and a PA engaged in prescriptive practices in accordance with certain laws, rules, and regulations.
We performed a mix of probe sample testing, statistical sample testing, testing on samples of services provided, and data analytics for this audit. Our two probe samples covered all claims paid in January 2015 to determine whether Dr. Poor (1) billed and was paid for services not performed (ghost services) and (2) billed for NP and PA services without modifier codes. Based on the results of these tests, we conducted tests using two distinct statistical samples using a 95% confidence level and 5% precision. Since we used statistical samples, we were able to project our findings to the entire population. We also tested a sample of 57 members who each received more than 5 services in a month; we applied what we learned from this sample to 100% of Dr. Poor’s E/M services using data analytics.
Our audit found that Dr. Poor did not properly submit claims for E/M services provided to MassHealth members. Our audit questioned the following seven areas:
- Dr. Poor billed for excessive E/M services, totaling $176,730, provided to members in nursing facilities and rest homes. These services exceeded the monthly allowed visits and were not related to emergency services.
- Dr. Poor improperly billed 92 out of a statistical sample of 176 claims without using the required modifier for E/M services provided by his NPs and PA. We extrapolated this error and questioned $35,541.
- Dr. Poor billed for $15,477 of E/M services performed while he was out of the country, based on our review of his travel itinerary from May 2010 through April 2016.
- Dr. Poor and his NPs and PA did not establish written prescriptive guidelines that would have ensured that the NPs and PA received proper guidance from Dr. Poor on matters related to prescribing. The NPs and PA wrote 657 prescriptions for MassHealth members without these written guidelines.
- Dr. Poor did not use the correct procedure codes when billing for $12,608 of services provided to MassHealth members residing in rest homes.
- Dr. Poor did not maintain proper documentation for 34 out of a statistical sample of 240 claims tested. We extrapolated this error and questioned $79,388 in E/M services provided to MassHealth members.
- Dr. Poor did not prepare legible documentation to support 455, totaling $24,501, of 822 claims tested.
To resolve these problems, our audit report recommended that Dr. Poor collaborate with MassHealth to repay all improper payments he received for excessive and/or unnecessary services, services billed while he was out of the country, services performed by his NPs and PA and billed without the required modifier, services billed using the wrong procedure codes, services billed without proper supporting documentation, and services for which the medical records were illegible. It also recommended that he ensure that his NPs and PA only prescribed within a written prescriptive-practice arrangement as required.
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Review of Vision-Care Claims Paid to Dr. Wenshang Yao
OSA conducted an audit of vision-care claims paid to Dr. Wenshang Yao for the period July 1, 2011 through June 30, 2016. During this period, MassHealth paid Dr. Yao approximately $1,210,513 to provide vision care to MassHealth members. The purpose of this audit was to determine whether vision care provided to MassHealth members was medically necessary, properly supported by documentation, and allowable in accordance with MassHealth regulations.
We selected a statistically random sample of 180 out of 35,351 paid vision-care claims from the audit period, using an expected error rate of 50%, a desired precision of 15%, and a confidence level of 95%, to determine whether Dr. Yao properly billed MassHealth for these services. Additionally, we applied data analytical procedures to 100% of Dr. Yao’s claims for dispensing services (fitting of eyeglasses to a member’s face). Our audit found that Dr. Yao billed using his provider identification number for an extrapolated amount of $396,962 in vision-care services that were performed by other vision-care providers, not Dr. Yao. For 10 of the 180 claims in our statistical sample, Dr. Yao billed for the wrong date of service. Finally, Dr. Yao improperly billed for a total of $218,784 in dispensing services for which he did not personally fit the new eyeglasses to the members’ faces.
To resolve these problems, our audit report recommended that Dr. Yao collaborate with MassHealth to repay the approximately $396,962 of vision care that he did not personally provide and that he repay, at a minimum, $28,744 of dispensing services for eyeglasses that were never ordered from MassHealth’s vision-care supplier or were never picked up. Finally, we recommended that Dr. Yao only bill for dispensing services at the time he fits eyeglasses to the members’ faces.
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| Date published: | March 15, 2018 |
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