Overview
During the audit period, MassHealth paid 605 claims for DME that were ordered by 15 providers who were excluded from participating in Medicaid. We also found that 8 of these 15 providers had their medical licenses suspended or terminated by the Massachusetts Board of Registration in Medicine before the date of service for the associated DME claims. This resulted in an overpayment of $31,724 by MassHealth to DME providers, which is detailed in the table below.
| Exclusion Type | Number of Claims | Overpayment |
|---|---|---|
| 7 Ordering Providers Excluded from MassHealth | 471 | $ 27,224 |
| 8 Ordering Providers Excluded from MassHealth and Whose Medical License Was Suspended or Terminated | 134 | 4,500 |
| Total | 605 | $ 31,724 |
MassHealth members may be put at risk when excluded providers are allowed to continue ordering DME on their behalf because they may be prescribed DME that they do not need by providers who are no longer licensed to prescribe it. Additionally, if MassHealth pays claims for DME prescribed by excluded providers, MassHealth is spending money that could have been used to provide additional services to other MassHealth members or reduce the cost of its services to the Commonwealth.
Authoritative Guidance
Section 1902(kk)(7) of the Social Security Act states,
The State requires—
- all ordering or referring physicians or other professionals to be enrolled under the State plan or under a waiver of the plan as a participating provider.
Section 450.212(A) of Title 130 of the Code of Massachusetts Regulations states,
To be eligible to participate in MassHealth as any provider type, a provider must . . . be fully licensed, certified, or registered as an active practitioner by the agency or board overseeing the specific provider type.
Reasons for Issue
MassHealth relies on a comprehensive process to identify ineligible MassHealth providers and flag them in the Medicaid Management Information System (MMIS). The 15 providers associated with this finding were flagged as inactive in MMIS, and the associated claims for DME ordered by the 15 inactive providers were flagged by system edits in MMIS. However, MassHealth’s system edits operate on a post-payment basis; therefore, the claims were paid anyway and never recouped after a formal review.
Recommendations
- MassHealth should develop procedures that deny any claims that are ordered, referred, or prescribed by providers who are excluded from participating in Medicaid or providers whose medical licenses are suspended or terminated.
- MassHealth should investigate the claims identified in this finding and recoup any overpayments that it deems appropriate.
Auditee’s Response
As announced in MassHealth’s All Provider Bulletin (APB) 286, MassHealth established pre-pay claims edits in September 2019 that denied claims that did not provide an NPI for an ordering, referring or prescribing [(ORP)] provider enrolled with MassHealth. In March 2020, to reduce providers’ administrative burden as much as possible during the COVID-19 Public Health Emergency (PHE), MassHealth temporarily suspended this edit. The edit was reinstated as of July 2023 per MassHealth APB 361. The [Office of the State Auditor’s (OSA’s)] audit period falls within this period of temporary flexibility to reduce provider burden, which explains Finding 2. Going forward, MassHealth’s pre-pay edits will prevent claims from being paid that do not provide an NPI of a MassHealth-enrolled ORP provider.
As noted in All Provider Bulletin (APB) 361, MassHealth reestablished pre-pay edits effective July 1, 2023, that will prevent payment for DME claims with an excluded provider listed as the OPR provider.
For services that require an ORP and have dates of service on or after July 1, 2023, claims will be denied if they do not meet the following ORP requirements:
- The National Provider Identifier (NPI) or the ORP provider must be included on the claim.
- The ORP provider must be an authorized ORP provider type (see list on page 2 of APB 286).
APB 361 further established that, for dates of service on or after September 1, 2023, claims will deny if they do not meet the ORP requirement that the ORP provider must be enrolled with MassHealth (see page 2 of APB 361).
MassHealth believes that these requirements and associated edits capture DME that was ordered by providers who were excluded from participating in Medicaid, including providers whose medical licenses are suspended or terminated, and prevent the overpayments identified in this audit going forward as of July 1, 2023 and September 1, 2023. . . .
MassHealth agrees with [Recommendation 2]. MassHealth will review the claims identified by the OSA and carry out the recovery process as appropriate.
Auditor’s Reply
Based on its response, MassHealth is taking measures to address our concerns regarding this matter. As part of our post-audit review process, we will follow up on this matter in approximately six months.
| Date published: | October 30, 2025 |
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