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Report  Annual Report Medicaid Audit Unit for March 15, 2018-March 15, 2019

A review of the work conducted by State Auditor Suzanne M. Bump's Medicaid Audit Unit over the past year. It highlights audits released, audits in progress, and the impact of the Unit's work.

Organization: Office of the State Auditor
Date published: March 15, 2019


The Office of the State Auditor (OSA) receives an annual appropriation for the operation of a Medicaid Audit Unit (the Unit) for the purposes of preventing and identifying fraud, waste, and abuse in the MassHealth system and making recommendations for improved operations. The state’s fiscal year 2018 budget (Chapter 47 of the Acts of 2017) requires that OSA submit a report to the House and Senate Committees on Ways and Means by no later than March 15, 2019 that includes (1) “all findings on activities and payments made through the MassHealth system”; (2) “to the extent available, a review of all post-audit efforts undertaken by MassHealth to recoup payments owed to the commonwealth due to identified fraud and abuse”; (3) “the responses of MassHealth to the most recent post-audit review survey, including the status of recoupment efforts”; and (4) “the unit’s recommendations to enhance recoupment efforts.”

For fiscal year 2019, the appropriation for the OSA Medicaid Audit Unit was $1,198,713. This amount represents an approximately 3% increase over the Unit’s fiscal year 2018 appropriation of $1,163,799. OSA submits all costs (direct and indirect) associated with running this unit to the Executive Office of Health and Human Services (EOHHS) to be included in its in quarterly filings with the Centers for Medicare & Medicaid Services for federal cost sharing. In federal fiscal year1 2018, OSA submitted a total of $1,357,192 to EOHHS for consideration for the state’s program integrity, allowing the state to obtain a 50%, or $678,596, reimbursement of these costs.

This report, which is being submitted by OSA in accordance with the requirements of Chapter 47, provides summaries of two performance audits involving the following:

  • payments for unbundled and duplicate drug tests
  • frequent drug testing of MassHealth members

It also summarizes five MassHealth provider audits involving the following:

  • an orthodontic provider (one audit)
  • a substance use disorder treatment provider (one audit)
  • adult day health providers (two audits)
  • a vision-care provider (one audit)

The report also summarizes OSA’s objectives for MassHealth audits that are currently underway. Finally, it details the corrective measures and related outcomes reported by the auditees, including MassHealth, in relation to our findings and recommendations for six audits.

This report details findings that identified unallowable, questionable, duplicative, unauthorized, or potentially fraudulent billings totaling $13,207,381. The report also describes corrective actions being taken by MassHealth as a result of six audits whose findings were issued at least six months ago for which follow-up surveys have been completed and MassHealth has taken actions to begin recouping funds. Auditees reported action or planned action on 92.5% of our audit recommendations, which will improve operational efficiency and effectiveness.


A PDF copy of the Annual Report of the Medicaid Audit Unit is available here.


1. The 2018 federal fiscal year is October 1, 2017 through September 30, 2018.




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