Press Release  Audit of MassHealth Finds Issues with Over $4 Million in Spending

Boston — State Auditor Suzanne M. Bump today issued an audit which questions $4 million in MassHealth payments for wheelchairs and wheelchair components.

MassHealth, the state’s Medicaid agency, with an annual budget of $12.2 billion, provides access to healthcare services for approximately 1.5 million low- and moderate-income individuals. MassHealth is the state’s largest program and accounts for approximately one-third of the state budget. During the 18-month audit period, MassHealth made payments totaling $24.9 million for mobility assistive equipment. Claims for wheelchairs and wheelchair components represent 92 percent of that amount.

“MassHealth is a complex agency with many programs serving many people,” said Auditor Bump. “However, this agency requires strong and active oversight.”

The audit findings included:

• MassHealth regulations require it pay providers for wheelchairs and component parts at a rate equal to the lowest usual and customary amount the provider accepts from any other insurance carrier. By failing to do so, it spent $1 million more than was necessary during the audit period.
   
• MassHealth paid $2.9 million in repair claims for wheelchairs and components without proper authorization. Prior authorization is required for claims for wheelchair repairs exceeding $1,000. Because the Prior Authorization Unit improperly calculated total repair costs, including labor and costs, $2.9 million in claims were not properly authorized.
   
• MassHealth made payments totaling $540,801 for improperly authorized, provided, or billed wheelchair components because the agency’s claims system could not detect when limits and restrictions on equipment had been reached. For example, auditors identified $40,206 in duplicative payments and $158,594 for components or repairs to manual wheelchairs used by members residing in nursing homes.

In response to the recommendations presented in the audit, MassHealth has indicated that it is implementing new systems and processes to prevent and recoup these excess payments.

“I am pleased that MassHealth plans to address these concerns because it illustrates how our two agencies can collaborate to ensure this vital program delivers the best service to its members and best value to taxpayers of the Commonwealth,” said Auditor Bump.

The Office of the State Auditor conducts performance audits of state government’s programs, departments, agencies, authorities, contracts, and vendors. With its reports, the OSA issues recommendations to improve accountability, efficiency, and transparency.

The MassHealth - Review of Controls over Mobility-Assistive Equipment audit is available here.

###