January 19

DHHS loses track of millions in overpayments to long-term care providers

A state review blames the problem on old computer and accounting problems that were never fixed.

By Kelley Bouchard kbouchard@pressherald.com
Staff Writer

The Maine Department of Health and Human Services has lost track of millions of dollars in Medicaid overpayments made to nursing homes and assisted-living facilities in the last several years because of computer and accounting problems that were discovered in 2006 but never fixed, according to the Office of the State Auditor.

The agency made an estimated $29 million in overpayments to long-term care providers in fiscal year 2013, which ended June 30, but it doesn’t have adequate computer systems or accounting procedures in place to make sure all of the money is returned to the state or to prevent future overpayments, said State Auditor Pola Buckley.

When the state Office of the Controller recently reviewed Medicaid reimbursements made to assisted-living facilities from September 2010 through June 2013, it found $36.4 million in overpayments, Buckley said.

“The state doesn’t have a record of how much was owed before that. It’s likely millions of dollars,” Buckley said. “In some cases the money is returned to the state, but not always.”

Buckley said the total amount of overpayments is a dynamic number that is always growing and effectively removes $35 million to $40 million from the Medicaid system at any given time. As a result, that money isn’t available to help Maine’s rapidly growing senior population or to fill funding gaps for long-term care providers who struggle to cover rising costs. The total of unrecovered overpayments is unknown.

The overpayments are highlighted in a new report and proposed emergency legislation that will be presented Tuesday to the Legislature’s Health and Human Services Committee. The report was issued earlier this month by the Commission to Study Long-Term Care Facilities, which addressed a variety of concerns related to nursing homes and assisted-living facilities.

The commission’s focus on Medicaid overpayments comes as DHHS increasingly takes heat for recurring operational and financial problems. The LePage administration blames MaineCare – as Medicaid is called in the state – for about $108 million of a $119 million shortfall in the current state budget. Meanwhile, a proposal to expand Medicaid coverage to 70,000 to 100,000 additional Mainers is generating contentious debate in the Legislature.

Maine’s growing senior population is expected to increase demand for long-term care, including in-home care, and put additional pressure on Medicaid as the largest and most complicated division of DHHS.

Maine’s median age – 43.5 years – is the highest in the United States, in part because the state also has a dwindling younger population, according to the U.S. Census. The state’s proportion of people age 65 and older – 17 percent – is second only to Florida’s 18.2 percent.

Maine also has the nation’s highest proportion of baby boomers – 29 percent of its 1.3 million residents were born between 1946 and 1964 – and they’re turning 65 at a rate of 18,250 a year, according to AARP Maine. By 2030, more than 25 percent of Mainers will be 65 or older,

The Portland Press Herald/Maine Sunday Telegram is examining various impacts of having an aging population in a special investigative series, “The Challenge of Our Age.”

The estimated $29 million in Medicaid overpayments to long-term care providers in fiscal 2013 represented 5.5 percent of $528 million in federal and state Medicaid payments to nursing homes and assisted-living facilities between July 1, 2012 and June 30, 2013, according to the state auditor’s office.

Emergency legislation proposed by the long-term care commission would force DHHS to fix its computer systems so they no longer generate overpayments and can assist the agency in collecting past overpayments. For years, tracking and recapturing overpayments has been done mostly by hand.

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