I. Healthcare Reviews
Each fiscal year, the state budget includes language requiring the Office to review the Health Safety Net (HSN) and Medicaid programs, which are administered by the Office of Medicaid (MassHealth).23 This may include reviewing eligibility requirements, utilization, claims administration and compliance with federal mandates. The budget language requires the Office to produce a report each March. Below are highlights from the Office’s reviews.
A. Adult Foster Care
Adult foster care allows MassHealth members to live with a caregiver who provides medically necessary assistance with activities of daily living (ADLs) and instrumental activities of daily living (IADLs).24 ADLs are physical skills like eating, dressing and bathing. IADLs are life management tasks like paying bills, shopping and preparing meals.
MassHealth members may also receive assistance with ADLs from home health aides. However, regulations prohibit MassHealth from paying for a member to receive adult foster care on the same day they receive home health aide services. Furthermore, adult foster care is billed at a per diem rate. Therefore, providers should not bill – and MassHealth should not pay – multiple claims for service provided to the same member on the same day.
The Office reviewed approximately $349 million in adult foster care claims that MassHealth paid between May 1, 2018, and April 30, 2019. The Office found that MassHealth allows providers to bill for multiple days on a single claim. Furthermore, rather than identifying the specific dates that the member received care, providers can list a date range for the services. While this practice is permissible, it impedes oversight because it can be difficult or impossible to determine the specific dates the services were provided. It also makes it more difficult to identify when a member has received overlapping services.
The Office also found (1) MassHealth paid $664,165 in adult foster care claims on days a member also received home health aide services; (2) 5,168 instances when a provider submitted two adult foster care claims for a single day; and (3) 604 instances when a provider billed for a month of service – 30 or 31 days – but only listed a single date of service on the claim.
The Office recommended that MassHealth implement edits in its claims adjudication system to proactively prevent paying for adult foster care services that members received on the same day they received home health aide services. MassHealth should also consider requiring providers to bill for adult foster care one day at a time. Finally, MassHealth should consider whether it is appropriate for providers to bill for a month of service but only list a single date of service on the claim.
B. Sleep Studies
MassHealth pays for members to undergo medically necessary sleep studies to diagnose sleep disorders, including obstructive sleep apnea. Obstructive sleep apnea occurs when breathing stops temporarily during sleep due to narrowed or constricted airways. A provider may conduct a sleep study at a sleep clinic, at a hospital or in a member’s home. Each sleep study requires equipment, supplies and a technician to set up the test, as well as a physician or similar healthcare professional to interpret the sleep study. Providers can either bill MassHealth for the entire process as a single combined service or submit two separate claims: one for the technical component, covering the test itself, and another for the professional component, covering the interpretation.
The Office reviewed 57,987 claims for sleep studies conducted between January 1, 2015, and December 31, 2019 for a total cost of $25,203,501 for 22,569 members. The Office found 1,286 claims, totaling $557,103, for the technical component of a sleep study that did not have a corresponding professional component. Since the technical component is medically useless without professional interpretation, billing for only half the procedure presents three possibilities: providers are wasting public funds by performing the technical component unnecessarily; providers are defrauding MassHealth by billing for sleep studies they did not perform; or providers are performing full sleep studies but failing to bill MassHealth for the professional component. Two providers accounted for 548, or 50%, of these claims. The Office forwarded information about these providers to MassHealth.
The Office recommended that MassHealth evaluate its claims edits and program integrity processes to ensure that the agency only pays for completed sleep studies that include both the technical and the professional components.
C. Positive Airway Pressure Devices
Patients use positive airway pressure (PAP) devices, a type of durable medical equipment, to treat sleep disorders, including obstructive sleep apnea. MassHealth regulations allow the agency to pay for PAP device rentals for a maximum of 13 months, at which point the member owns the device. MassHealth also will pay for certain parts of each PAP device to be replaced at regular intervals. For instance, MassHealth will pay for a new PAP mask every three months.
The Office reviewed 170,792 PAP device claims for calendar years 2015 through 2019 and found that, overall, MassHealth has strong program integrity for PAP devices. The Office identified three areas that may benefit from additional oversight. First, the Office found that MassHealth paid a small number of duplicate claims for PAP device rentals. Second, the Office saw a low occurrence of rentals that exceeded 13 consecutive months. Third, the Office found that MassHealth sometimes paid for replacement parts more frequently than the regulations allow.
The Office recommended MassHealth evaluate its claims edits periodically to ensure that it continues to identify and deny duplicate claims as well as too-frequent replacements of durable medical equipment and parts. MassHealth should also continue to monitor its payment system to ensure that it is reimbursing claims appropriately.
D. Personal Care Attendants
The Office followed up with MassHealth regarding the personal care attendant (PCA) program, which was the focus of the Office’s annual report on the Medicaid and Health Safety Net programs in 2020. In that report, the Office identified several issues that limited MassHealth’s ability to provide meaningful oversight of the PCA program.
The Office found MassHealth did not have accurate information about the identities of the PCAs who provide services to members. As a result, MassHealth could not ensure adequate program integrity or determine whether the PCA program was working within its regulatory framework. For example, MassHealth could not determine whether each PCA was following regulations that, among other things, prohibit a PCA from caring for a family member and from working more than 50 hours a week.
In response to this finding, MassHealth now requires the fiscal intermediaries (FIs), which help administer the PCA program, to provide MassHealth with identifying information for all PCAs – including each PCA’s name. Under a new contract that begins in 2022, moreover, MassHealth will require that every claim for PCA services include a unique PCA identification number. The Office strongly supports this requirement because it will provide a direct link between the PCA, the claim for payment and the MassHealth member(s) for whom the PCA provides services.
In 2019, the Office also reviewed de-identified criminal offender record information (CORI) and sex offender registry information (SORI) of PCAs and found substantial numbers of PCAs had previous involvement with the criminal justice system. MassHealth allows members to select their own PCAs and decide whether to request CORI and SORI checks. Over the past year, MassHealth has solicited feedback from members and stakeholders about how to increase the number of PCAs who undergo background checks.
Finally, the Office reviewed PCA travel claims, which are claims for PCAs to travel from one member’s home to another member’s home. The Office found inconsistent and incomplete data, making it impossible for MassHealth or its vendors to conduct rigorous program integrity reviews. The Office also found that MassHealth was reimbursing PCAs for traveling significant distances to care for members, which raises concerns about good business practices and program integrity.
In response to the Office’s findings, MassHealth began taking steps to identify inaccurate travel claims and to recoup improperly paid claims. For example, MassHealth created an algorithm to flag PCA travel claims that require further review. It began using the algorithm in January 2021.
The Office continues to recommend that MassHealth conduct a full audit of all travel claims. This audit should look for red flags of fraud, waste or abuse, including why some PCAs appear to finish one shift and start a second shift simultaneously, even though they are caring for members who live at different addresses. The audit should also include a review of consistently high work and travel claims to identify program integrity issues.
II. Public Design and Construction
Since its inception, the Office has helped develop policies and procedures related to the Commonwealth’s public design and construction laws. In 2020, the Office worked with the Department of Capital Asset Management and Maintenance (DCAMM), the Massachusetts Department of Transportation, the Massachusetts Port Authority, the Massachusetts School Building Authority, the Massachusetts Attorney General’s Office and other state and local entities to establish best practices in public construction.
A. Alternative Construction Methods
Pursuant to Chapter 149A of the Massachusetts General Laws, the Office reviews applications to use alternative delivery methods, including the construction management at-risk (CM at-risk) and design-build methods.25 In addition, before certain state agencies and authorities may use alternative delivery methods on construction projects, the legislature has charged the Office with reviewing and approving the procedures for utilizing those delivery methods. Consequently, the Office reviews and approves certain procedures for DCAMM, the Massachusetts Port Authority, the Massachusetts Department of Transportation, the Massachusetts Bay Transportation Authority, the Massachusetts Water Resources Authority, the Massachusetts State College Building Authority and the University of Massachusetts Building Authority.
In 2020, the Office received 18 applications to use the CM at-risk delivery method, totaling over $1.6 billion in estimated project costs. The projects included 10 public schools, one public charter school, one affordable housing development, three public safety buildings, one town hall renovation, one recreation facility and one police station. Applicants included the cities of Boston, Gloucester, Lawrence, Quincy, Salem and Worcester, as well as and the towns of Andover, Ashland, Brookline, Dedham, Oak Bluffs, Shrewsbury, Stoughton, Wakefield and Wellesley. Additional applicants included the Cambridge Housing Authority and the Springfield Preparatory Charter School.
In 2020, the Office received one design-build application from the Springfield Water and Sewer Commission for a water infrastructure project. In July, the Office approved the Commission’s application to use the design-build alternative for the $21-million project. This was the first design-build application received from a local jurisdiction in ten years.
B. Owner's Project Manager Review Panel
Staff from the Office represent the Office at the Massachusetts School Building Authority’s (MSBA) Owner’s Project Manager Review Panel (Review Panel). When a school district receives state funding to build a new school, it must use an owner’s project manager (OPM) to oversee the building project. The Review Panel, led by the MSBA, reviews each school district’s selection of an OPM, including the evaluation process the school district used.
As members of the Review Panel, Office staff review each district’s process and evaluation of its OPM applicants. This review entails examining both the school district’s needs and the OPM’s qualifications, including the OPM’s project experience, managerial experience, backlog of other ongoing work, and financial viability. Staff then participate in the Review Panel’s meeting, listening to school district presentations. After considering the presentations and reviewing the materials, the Review Panel may either agree with the school district’s selection of an OPM or recommend further review and consideration.
III. Real Estate Transactions
Each year, the Office reviews a variety of real property transactions involving public property, including dispositions, acquisitions and long-term leases, to ensure that the public’s interests are protected. In addition, the legislature frequently mandates that the Office reviews and approves independent appraisals of real property that the Commonwealth, counties and municipalities propose to convey or acquire. The Office’s appraisal reviewers evaluate whether the analyses, opinions and conclusions in the appraisal are appropriate and reasonable. As mandated, the Office provides a report on each appraisal to the Commissioner of DCAMM for submission to the House and Senate Committees on Ways and Means and the Joint Committee on State Administration and Regulatory Oversight.
Below are examples of transactions that the Office reviewed in 2020.
A. Lowell District Courthouse
Chapter 304 of the Acts of 2008 (Chapter 304) authorized the sale of the Lowell District Courthouse. Chapter 304 also required DCAMM to obtain an appraisal of the property and the Office to review that appraisal. In 2020, the Office reviewed the appraisal and the methodology used to value the property. The Office found that the appraiser provided two opinions of value. First, the appraiser analyzed the site for a multifamily development use. The appraiser also completed a valuation of the land for municipal use. The appraiser’s valuations considered that the courthouse would be demolished. The Office concluded that the opinions of value of the land for a multifamily development and municipal use were supported.
B. MIT Boathouses
DCAMM, in consultation with the Department of Conservation and Recreation (DCR), is authorized to lease certain land and appurtenances to boating organizations. In 2020, the Massachusetts Institute of Technology (MIT) proposed two formal leases with DCAMM: one for its Harold W. Pierce Boathouse and one for its Wood Sailing Pavilion. DCAMM provided the Office with a draft lease for the Pierce Boathouse, using a template DCAMM also used for the Sailing Pavilion. During the term of the 30-year lease, which included an option to extend for five additional years, MIT will pay monetary rent for the land and water sheet area. MIT constructed and owns the buildings on the premises. Therefore, DCAMM did not require MIT to make capital improvements to the buildings but did require reasonable maintenance and upkeep of the premises. In addition, MIT must make restrooms available to the public, maintain a boat for buoy maintenance and water sampling, host certain events for the public and offer other in-kind considerations. Based on the Office’s review, DCAMM’s lease for the Pierce Boathouse was consistent with the terms and conditions of the authorizing legislation and it therefore approved the form of the lease.
C. Easements
Pursuant to legislation, the Office reviewed appraisals of permanent and temporary easements in the Milton and Quincy sections of the Blue Hills Reservation; in Bellingham for the installation and maintenance of a water main; in Grafton for utility purposes; and in New Salem for the purposes of installing, operating, maintaining and repairing utility poles and associated overhead wires to provide broadband service. In the separate reviews of each easement area, the Office found that DCAMM’s appraisers used appropriate methodologies to support the valuations and appropriately analyzed the property rights associated with the grant of the easements. The Office therefore approved the appraisal methodologies and opinions of value.
IV. Legislative Initiatives
Since it was established in 1981, the Office has reviewed and commented on proposed legislation during each legislative session. In addition, the Office regularly provides feedback to individual legislators who are developing both legislation specific to the districts they represent and legislation that affects the general operations of state and local government. The Office also responds to requests from the Governor’s Office to review legislation that the legislature has passed and is awaiting the Governor’s signature.
The Office continued to provide these important services throughout 2020. For instance, the Office reviewed and commented on more than 100 pieces of legislation for the 2019-2020 legislative session. In 2020, the Inspector General and his staff also provided testimony and guidance to legislative committees on issues related to real estate transactions, fraud controls, employee leave time policies, post-retirement work policies, and the procurement of public supplies and services. In all cases, the Office stressed the importance of transparency in government and the need for safeguards to ensure the appropriate oversight of public funds.
V. Proposed Legislation: 2020-2021 Session
Chapter 30 of the Massachusetts General Laws permits the Office to file legislation in the November of even years for the upcoming legislative session. In November 2020, the Office filed the following bills for the 2020-2021 legislative session.
A. House 4, An Act Relative to Chapter 12A
House 4 would amend the Office’s enabling statute in order to increase the Office’s ability to prevent and detect fraud, waste and abuse. Modeled after the federal Inspector General Empowerment Act of 2016, the proposal clarifies that the Office has access to all records of a public body unless the General Court expressly limits that access.
The proposal would also allow the Office to refer a potential criminal matter to a district attorney in the same manner that it refers cases to the U.S. Attorney and the Attorney General. Further, the proposal would allow a member or designee of the Inspector General Council to attend a private session where testimony is given under oath at the request of the Inspector General, but it removes the attendance requirement. The role of the Inspector General Council otherwise would remain the same, including approving summonses to take testimony under oath. Finally, the proposal would extend whistleblower protections to private employees. Any person who violates these whistleblower protections would be subject to a fine and liable for damages. The bill was referred to the Joint Committee on State Administration and Regulatory Oversight.
B. House 5, An Act Relative to Inspector General Annual Report
House 5 would consolidate the Office’s annual reports into one, comprehensive report. Specifically, the proposal would modify the requirement that two embedded units in the Office, the Internal Special Audit Unit and the Division of State Police Oversight, submit separate annual reports to the legislature. Instead, these reports would be included as part of the Office’s annual report required under Section 12 of Chapter 12A. The Office would also be required to submit its annual report to both the Joint Committee on Transportation and the Joint Committee on Public Safety and Homeland Security, as is currently done by the Internal Special Audit Unit and the Division of State Police Oversight. The bill was referred to the Joint Committee on State Administration and Regulatory Oversight.
C. House 6, An Act Relative to Chapter 30B
House 6 would increase the fine for causing someone or conspiring with someone to solicit or award a contract in violation of the Uniform Procurement Act, Chapter 30B of the Massachusetts General Laws (Chapter 30B). Based on the Office’s investigations and reviews, those who conspire to violate Chapter 30B can receive hundreds of thousands of dollars as a result of their misconduct while depriving the municipality of needed goods or services. Consequently, the current fine – $2,000 – is an insufficient deterrent to violating Chapter 30B. Raising the fine to $10,000 – as the Office proposes – would have a far greater deterrent effect. This proposal also would update Chapter 30B to include the correct statutory references to other recently amended statutes. The bill would also strike a section of Chapter 30B that is duplicative. The bill was referred to the Joint Committee on State Administration and Regulatory Oversight.
D. House 7, An Act Revising Chapter 30B
House 7 would augment certain sections of Chapter 30B to promote best practices, fair competition and transparency. The proposal defines certain terms, clarifies areas where the statute’s intent is often questioned or silent and enhances the process an awarding authority must use when soliciting quotations. Under the proposed revisions, awarding authorities would be able to use requests for proposals for procurements in the $10,000 to $50,000 range. The proposal also clarifies that an awarding authority cannot allow a vendor to modify quotations for goods and services after they are received. Further, awarding authorities that do not have written procedures for the disposal of surplus supplies would be required to use sound business practices to dispose of surplus supplies valued at less than $10,000. The proposal also would require contractors to notify the Office when they have credible evidence of criminal conduct, civil violations or overpayments. In addition, a procurement officer may cancel a solicitation for supplies or services if it is in the best interest of the awarding authority and the procurement officer documents the reason for cancellation. Finally, the Office would be permitted to promulgate regulations related to the interpretation and enforcement of Chapter 30B.
House 7 would strengthen Chapter 30B and provide local jurisdictions greater guidance and flexibility in selecting which procurement method to use without sacrificing the principles of good governance and accountability. The bill was referred to the Joint Committee on State Administration and Regulatory Oversight.
E. House 8, An Act Relative to Public Employee False Claims
House 8 would protect municipalities, counties and the state when public employees knowingly submit false or fraudulent claims for hours not worked. Under the proposal, public employees would be liable for treble damages for any false or fraudulent claims of hours worked. The bill was referred to the Joint Committee on the Judiciary.
Additional Resources
Contact for OIG Annual Report 2020: Policy and Government Division
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| Date published: | April 30, 2021 |
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