- Report Published -
|Mitigating the Risk of Improper Payments in the Virginia Medicaid Program|
|Joint Legislative Audit and Review Commission|
|HJR 127 (Regular Session, 2010)|
|In response to House Joint Resolution 127 (2010), JLARC staff examined improper payments (errors, abuse, and fraud) in Medicaid.|
Errors in determinations of Medicaid eligibility made by local departments of social services may have resulted in improper payments with an estimated negative general fund impact of $18 million to $263 million in federal FY 2009. Significant investments are needed to reduce the effect of these errors, including new information technology, training, and oversight. By contrast, fraud committed by providers and recipients in FY 2009 was estimated to cost the general fund about $6.1 million. A higher percentage of these improper payments had been collected from providers (73 percent) than recipients (27 percent).
Audits of providers by the Department of Medical Assistance Services (DMAS) detected 91 percent of all improper payments made in FY 2009. To further improve and sustain a high level of performance, DMAS would benefit from more centralized audit planning, additional analysis, and implementation of prepayment auditing.
In FY 2011, Virginia’s managed care organizations received $2 billion in capitated payments. However, the data used to set capitated rates undergo little validation. DMAS should perform additional oversight to ensure that rates are not inflated because of improper payments.